Over the past two decades, outsourcing has been on the rise from technology to customer service to business processing. BPO, or Business Process Outsourcing, has been a contentious but necessary evil for many financial services firms as P&L’s are strained with increasing expenses for regulatory demands and front office innovation. Many engagements begin great, but fail overtime. For firms who have yet to cross over into the offshoring realm, the myths and fears of compliance issues to decreased customer service weigh down executives deciding on whether to take the plunge into outsourcing or not.
Voltaire and author Jim Collins so famously focused business executives on “good is the enemy of great.” This too is the mindset that plague many BPO engagements, settling for good only to see the fruits of greatness whither away along with the ROI for outsourcing as well. Why does this happen? And how can newer BPO arrangements steer their organizations away from this death trap?
To be successful and viable at any stage of your BPO process, you should question yourself at all times during and after your investment. Let’s start with current BPO engagements, do you have regular or quarterly reviews of your BPO functions? In many instances where existing BPO engagements fail, organizations fall into the “out of sight-out of mind syndrome.” This is when onshore functions become more advanced, change in ownership or technology improvements make the overall end to end process less than optimal. How does this happen? The truth is, gravity pulls organizations to be focused on what is in front of them. Offshore arrangement suffer merely by their location, putting them at a disadvantage of being top of mind. This creates a vacuum for many business and technology executives who fail to remember the impact to an outsourced function.
At minimum, a dedicated business manager or executive should have daily oversight of BPO functions which include reviewing the impact from any and all functional and technology changes onshore. Many business managers tend to be focused solely on escalations to the BPO team, which is only dealing with the symptoms. Regularly scheduled end to end process reviews from client to onshore to offshore functions should be reviewed annually to see if any changes to functions, processes and ownership should occur to maximize the BPO arrangement. Quarterly reviews should be done with reporting and metrics to identify any breakdowns of process changes as well as honing in on areas that require improvement. Organizations that have successful BPO engagements include internal audit and risk management as part of their annual review process of the BPO structure and ROI.
For firms considering BPO or a hybrid solution of outsourcing limited functions, setting up a detailed function list is key. This inventory of functions along with corresponding technology and impacted internal/external clients will be your blueprint for success. Second, investing in your key subject matter experts to train your BPO team is critical if not paramount to the quality of work you will receive. This can be done by setting up incentives, financial or career advancement, for these key resources to ‘train the trainer’ as well as be available for three to six months post launch to iron out any issues of the BPO deployment. Lastly, creating a culture where your onshore and offshore teams work homogeneously will have lasting effect on your overall corporate success. Discourage “it’s them not us” mentality and encourage onshore and offshore resources to work together on issues, include BPO team leaders on staff meetings or key organization announcements. Always remember, they are a part of your team and great organizations have an inclusive culture. Embrace the heavy lifting your BPO partners are doing for your organization.
Always be ready to remember that there is more to your organization’s success than that which is right in front of you. Don’t allow your BPO engagement, new or existing, fall victim to the ‘out of sight, out of mind’ syndrome. Maybe then, your BPO can go from ‘good to great’.