It is a deceivingly complex question that demands a thoughtful answer. Procurement BPO is not the right solution for everyone. Properly determining whether procurement BPO is right for an organisation requires a thoughtful and informed evaluation.
Facts and trends in procurement BPO can be difficult to discern. Analysts following the space can be unduly influenced by the marketing message of the providers serving the market, and have shown a tendency to be overly aggressive in predicting the timing of the expansion and the rate of growth of the procurement BPO market. As a result, it is often difficult to separate reality from fancy.
EightyTwenty Insight advisors have experience as providers, analysts and consumers of outsourcing services. As a result, we are uniquely positioned to tell the whole story regarding the industry. Our advisors have seen what makes outsourcing engagements succeed and fail at all points in the engagement lifecycle.
EightyTwenty Insight will make the investment to clearly understand not only the provider's business model, delivery model, resource management model, and business objectives, but also the customer's objectives, existing capabilities, current processes, available data, and concerns of affected constituents.
We will deliver a fact-based and thorough assessment of the options the company can pursue, and the tradeoffs associated with each. If a procurement BPO engagement is not the optimal solution, we are available to help implement alternatives, including:
1. Process reengineering
2. Technology adoption
3. Staff realignment
If an organisation decides to pursue a procurement BPO engagement, we are prepared to provide support throughout the contract. While there is no magic recipe that will guarantee success, there are several critical factors that EightyTwenty Insight Insight will deliver to improve the chances of success.
- Prepare - Aligning your objectives with the provider.
BPO deals are typically long term arrangements and they require close and effective working relationships in order to be successful. A BPO provider is essentially an extension of the customer's internal team. We will work to ensure there are both a healthy cultural alignment and a trusting relationship between the parties. This includes establishing open and regular communication and a clear mutual understanding of objectives, obstacles, and resolution requirements.
- Create - Defining and optimising processes.
Procurement BPO works better when a customer's processes are defined and accurate data is available. Some customers may be tempted to outsource the delivery of problem categories that are lacking standard processes, but an outsourcing engagement is not sufficient to fix fundamental process flaws or data gaps. EightyTwenty Insight will ensure that the delivery processes and required data for the outsourced services are well defined prior to handing the service over to the vendor.
- Implement - Securing internal support and adoption.
If all of the internal constituents within the organisation are not committed to support and utilise the new provider, the program's success will be jeopardized. EightyTwenty Insight will help to ensure that internal teams are interacting with the procurement BPO function in the correct manner, and that internal users are aggressively taking advantage of the service.
- Transition - Establishing Strong Governance.
In the course of any outsourcing engagement, issues will crop up and a thoughtful and well-supported governance plan will allow both the provider and the customer to deal with any roadblocks as they arise. Despite any current convictions that requirements will be stable over time, there will undoubtedly be unexpected changes to processes, delivery scope, delivery scale, dependent tools, and data. EightyTwenty Insight will ensure that there is a strong governance process so issues and potential changes can be addressed in an equitable manner.
- Transform - Assuring provider innovation.
Providers should not be perceived as just order fillers, nor should they focus all of their innovation efforts around reducing their own cost of delivery. EightyTwenty Insight will work with the customer and the provider to promote ongoing innovation by the provider that will benefit the customer.
- Perform - Validating savings.
After a few years, the baseline to measure savings can become hazy. This becomes particularly problematic when there is internal pressure to justify the cost of outsourcing, or when some portion of the provider's payment is based on risk sharing. EightyTwenty Insight will provide an independent validation of achieved savings throughout the engagement.
For more information on how we can assist you, please contact us.