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Leveraging BPO for IT Business

Many of the top BPO players in India had added a BPO arm mostly through acquisitions. Infosys bought Progeon, Wipro bought Spectramind and so on.

Recently, we have seen weaknesses in the IT Services business of many of the Indian service providers but the BPO side of their business powers on. In fact, you may say that many of the public companies are lucky that the weaknesses on the IT Services side are offset by gains in the BPO business.

"Moving Up the Value Chain" is right within the grasp of many of these IT service providers if they leverage the BPO business in some strategic and clever ways. Many of the Indian BPO Service Providers have very highly qualified, highly skilled Master Six Sigma, Six Sigma Black, Yellow and Green belts. And they have extensive experience measuring, reporting and improving quality of delivery and process excellence.

All of this could be leveraged very effectively by the IT side of things by combining Business Process Management, Continuous Process Improvement, Measurement, Analysis and Reporting on the Business Process Management side with knowledge of, and consulting services from the area of Service Oriented Architectures, Business Process Orchestration Software and BPM tools.

Enterprises around the globe are becoming more and more integrated across organizations and within organizations across functions. Many of these processes that span multiple companies and functions are automated with islands of manual work within these processes. When these islands of manual work is outsourced, why not look at entire processes, offer IT services and BPO services as package deals that is higher valued, strategic and resulting in highly increased ROI.

IT services combined with BPO services is just like an unpolished diamond waiting for its brilliance to spill out! Many top IT companies around the globe are in this position, but especially top IT companies in India that also have extensive and mature BPO operations.

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Tags: BPO, IT, Services

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Comment by Mayuresh Bhosale on March 17, 2011 at 3:02am
Hi,
I am Mayuresh G. from Pune. I have worked with BPO/IT industry since 2007. I am currently running a Outsourcing Project in Pune.
I have handled both the NonVoice/Voice Processes on Management Level. Meanwhile I got interested in 'BPO Projects'.
There are certian consultancies and Venders in India which provide BPO/IT Projects.
But most of them are fraud. Demand an upfront payment (Non Refundable) or ask to deposit in their bank account.
Please let us know about, how to get BPO/IT projects from Foreign countries Directly. Or Where to find Trusted Local Consultancies/Vendors.
We will be Glad to work with you. I hope to hear from you soon.

Regards,
Mayuresh G.
Comment by Shammik on February 5, 2010 at 1:09pm
Concept that is close to my heart, and wish the IT-BPO combine would get it. Many of these firms sell to the customer with at worst contrasting messages - IT saying automate and reduce headcount and BPO saying move your headcount to India and we'll save you money (more headcount moved, more money saved); and at best unsophisticated messages - we'll take your process as is and use 6-sigma to find areas for automation.

Here's what economics tells us. To make a product, use the optimal amount of labor and capital. When labor is expensive, use more capital or automate, when labor is cheap, reduce the amount of capital or technology to use. Firms have often made that optimal operating decision before outsourcing.

However, moving to India is a change in the comparative cost structure. People now need to take a consolidated IT-BPO (capital-labor) view on the "new" best composition of the two. Since we are moving to a lower labor cost paradigm, logically that can almost never mean the increase in capital or technology spend for the same volume of output. Yet, we unfailingly suggest the illogical.

So what do we do with the existing capital or technology stock when moving to a lower labor cost paradigm. My belief is that the answer is potentially in a shared service where buyers "contribute" the technology stack made redundant by offshoring to a shared service construct and ask for lower costs for the system as a whole.

Worth thinking about, and happy to correspond on the subject.

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