Business Case Realization: A Hands-on Approach to Outsourcing

Outsourcing generally has been a thorny issue. It has grabbed headlines, sparked off heated political debates and has been accused of costing Americans their jobs.

But one thing is for sure. One cannot wish it away in today’s scenario. It’s there and it is going to be around. So let’s take a good look at how we can make best use of it.

There is no doubt outsourcing to BPO (business process outsourcing) companies has its merits. But it is not a panacea for all ills, and certainly not a magic wand for instant profitability. Remember, when you are handing over your crucial back end administration or customer care or accounting work to a firm outside the country, you have to be doubly sure the BPO company is trustworthy and will actually deliver.

Hence, before you decide to opt for outsourcing, it is essential to make a realistic assessment of why exactly you want it.

Let me put it simply. Do you want to outsource to cut costs? Or do you want to tap the talented and skilled manpower reserves existing outside of the US?

As the first essential step, you got to be very clear on the objective for outsourcing to a firm outside the country. Once you are focused on why you want to outsource, you will know for sure which company will best fulfill your requirements.

Now, its not enough to just seek out a BPO firm, hand over the work and sit back twiddling thumbs that the profits will come rolling in. They won’t if you don’t keep a hawk’s eye watch on some crucial parameters such as quality controls, maintaining delivery schedules and the anti-social effect of time zones, especially in case of business-critical Managed IT services.

So how does one maintain quality and cut costs?

The answer lies in “business case realization”. It is a proactive, continuous process which helps companies understand, measure and achieve predictable and sustainable business value. It lays down the frame work to realize the benefits anticipated from BPO initiatives.

Business case realization helps you to sharply focus your BPO initiatives towards benefits and also makes them flexible for any course corrections. But it cannot be done in patchwork. To make it show best results, you got to integrate it within your BPO initiative right from the word go. It should encompass multiple areas and disciplines within the initiative.

If integrated properly within the BPO framework, business case realization will save you from a “wait-and-watch” approach and give you a more “hands-on” approach towards monitoring the work process and the results.

Let me now take you through some of the aspects of business case realization which make this approach so successful.

Focused Outcome:

Business case realization lets you define the benefits of a BPO initiative in terms of the outcomes, associated measures and value. While developing business case realization, you must also give importance towards developing activities, resources, accountability and measures that will help you in reaching your targeted benefits.

This sounds somewhat similar to program management as it ensures a clear sight between BPO benefits and organizational imperatives.

Proactive Method:

Business case realization is essentially a proactive approach. It lets you anticipate the mistakes and the loopholes and helps you to control them before they can blow up into a crisis. It also helps in cutting down the costs as well as controls the risks by employing checkpoints and milestones to ensure quality within given timeframes.

To make the BPO initiative deliver the desired results, the key stakeholders of the outsourcing company such as the providers, management, employees and customers should ask themselves the following questions:

1. Is there a sense of shared accountability between the management of the outsourcing company and its BPO companies?

2. Is it just a service level agreement (SLA) for managed IT service or does the BPO company equally value the dependency of quality of our services and our objectives towards providing customer value with continued efficiency?

3. Do we take them merely as vendors or view them as partners? Do we try to integrate them in our organizational culture by sharing business critical knowledge with them?

Honest answers to these questions will help you decide whether your BPO initiative will be a success or not.