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8/6/2019 Offshore BPO Wipro

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Webinar agenda

Keynote address:

Rebecca SchollPrincipal AnalystGartner

(45 minutes)

Poll: 2 minutes

Question & Answer Session: 15 minutes

Introduction & case studies:

Sanjay JoshiVice ChairmanWipro Spectramind

(20 minutes)


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Offshoring BPO : A framework for

getting started

These materials can be reproduced only with Gartners official approval. Such approvals may be requested via e-mail --

[email protected].

Presented by: Rebecca Scholl

Principal AnalystGartner

Date: June 26, 2003


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Agenda

Key trends in offshore BPO

The offshore BPO competitive landscape

How to manage a successful offshore BPO relationship

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Pros and cons of using BPO providers

Cons

They cost too much

They dont understand mycompanys unique processes

We will never be able to re-insource

The quality of service willdecrease over time

Pros

We are forced to do more

with less My competitors are doing it

We can get better servicelevels than we could in-

house We can get access to new

technology withoutincurring capital expenses

We can learn from them

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BPO : Multiple types, multiple approaches

BSP

HR BPO

Offshore BPOProcurement BPO

Payment

processing

F&A BPO

Call center

outsourcing

Claims

processing

Payroll

processing Revenue cycle

management

BTO

Vertical

BPO

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Appeal of offshore

HighMediumLow

Penetration(Percentage of

enterprises currently

involved in these

service offerings

using offshore

resources)

BI

New

app.dev. App.maint. and

mgmt.

Legacy

app.

dev.

App.

migration

BPO

Contact

centers

Infra-

structure

services

EAI

Packaged

apps.

Leverage: (Offshore/onshore resource mix high means more resources offshore)

Low

High

OEM

product

dev.

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Nearshore: Easier travel Cultural similarities Time zone

Offshore:

Lower costs Time to market Resources Quality

Onsite/Offsite

Nearshore:Mexico

Nearshore:

Canada Offshore:Ireland

Offshore:

India

Offshore:

Eastern Europe

Current PrioritiesLonger-Term Prospects

Offshore:

PhilippinesNearshore:Jamaica

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Making the economics work: Leveraging a global delivery model

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Offshore BPO - Still not mainstream

Number of enterprises

using offshore sourcingfor the first time

Type A:Early adopters Type C:Laggards

Largest segmentof enterprise

buyers comprise

this category,

hence there will a

large volume of

activity

Type B:

Pragmatists

Time2002-2003 2004-2005 2006 +

Global delivery oftrueBusiness ProcessOutsourcing

Global delivery(onsite/nearshore/offshore) of

Application related services

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Business processes at work

Telemarketing, Fundraising, etc.

Inquiry handling,customer support

Up sell, Cross sellMarket data analysis EnterpriseServices

Human Capital

Finance and Acct

IT Facilities Mgt

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AR/AP, reconciliation

Policy administration

Claims processing

Technical assistance,helpdesk

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Agenda




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Offshore BPO provider categories

Type of supplier Supplier name

Offshore contact center specialistsDaksh, 24/7, Transworks, eServe, Vcustomer,

C3, e-Telecare

US consultants and IT services

GECIS, Amex, World BankInternal back-office Centers

Infosys (Progeon), Wipro (Spectramind), HCL

Technologies (e-Serve), Satyam, TCS, Patni

Offshore IT services

ACS, CSC, EDS, Accenture, Exult

Note: Not a definitive list

US contact center specialistsConvergys, Spherion, Stream, Sitel.

TeleTech, ICT Group, Sykes

Vertical and back-office specialistseFunds, EXLService, OPI, Vision HealthSource,

ICICI OneSource, WNS

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Evaluating offshore BPO vendors

Which partner type and company is the best fit for which company?

Branding

Limited US presence Scalability

Industry/process skill

Dedication to BPO model Flexibility

Pure-plays

Lack of back-office expertise Lack of IT integration capabilities

Lack of senior project managers

Existing facilities Operational expertise

Existing reference accounts

Contact center specialists

Lack of reference accounts for BPO

Sales focused on IT department

Project-based focus

IT processing power

BPR and IT integration skills

Presence in the US market

IT service providers

No external market experience

Lack of IT integration capabilities

Lack of cross-industry models

Process expertise

Years of experience

Industry/process skill

Internal back-office centers

WeaknessesCompetitive advantageVendor category

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Country selection criteria for offshore sourcing

0 1 2 3 4 5 6

Relevant skill sets

Cost of Labor

Language skills

Security/Business Continuity

IP Protection

Country Infrastructure

Cultural fit

Proximity to the US

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Company selection criteria for offshore sourcing

0 1 2 3 4 5 6 7

Near-shore presence

Multi-vendor capabilities

Full outsourcing

Certifications

Project management

Quality of resources

Cost

Offshore process/methodology

42 respondents

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Strengths

High quality technical skills

Reference clients - measurable results

English language Business intelligence

Non-disruptive approach to existing processes

India SWOT analysis

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Focus on communication as a core competency 15


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Strengths



English language Business Intelligence


Weaknesses

Link between IT and business

Change management capabilities

Lack of global footprint UK-centric approach

Underutilized infrastructure

India SWOT analysis

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Strengths



English language

Business Intelligence Non-disruptive approach to existing processes

Threats

Increase in attrition

Social resistance in client countries

Competition from other English-speaking

locations

Weaknesses



Lack of global footprint

UK-centric approach


India SWOT analysis

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Strengths



English language

Business Intelligence


Threats

Increase in attrition

Social resistance in client countries

Competition from other English-speaking

locations

Opportunities

Leverage existing infrastructure

Global strategy

Indirect channels

Attract US and European service providers

Develop new HR strategies Focus on communication as a core competency

Weaknesses



Lack of global footprint

UK-centric approach


India SWOT analysis

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Agenda




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What are our corecompetencies?

What functionsare

strategic?

How agile will mybusiness be?

What are my currentcosts?

Insource vs. outsource decision process

What should bedone internally

vs. outsourced?

What operationsand management

tasks remain?

What are the currentoperations services?

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Internal metrics

Process complexity and multiple custom contracting vehicles;need to evaluate the one or many provider approach

No one provider can offer a single aggregated solution that has

been market tested; complexity in comparing offerings

The typical distributed environment makes it difficult toaccurately define existing baselines; transition issues

BPO buyer challenges: Youre not alone, but you are unique

Vendor selection

Contracting

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Top challenges in offshore sourcing

0 1 2 3 4 5 6

Buy-in from corporate

management

Understanding vendor

differentiators

Negotiating contract

terms

Managing change

requests

Integrating with internal

apps

Managing project

timeline/budget

Managingcommunications

42 respondents

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Key risks in offshore BPO

Immaturity of US and European BPO demand

Low level of confidence on security issues

Business-centric demand vs. technical-centric supply

Complexity of BPO delivery structure

Importance of change management issues

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Workforce related risk - Worker backlash

Employee flight

Loss of top performers

Deal-breaker

Intellectual capital

Malaise and low morale

Cultural breakdown

Negative reputation

Productivity loss

Little motivation

Activism

Negative publicity Sabotage of projects

Network armies

Our employeesare our greatest assets.

I say we sell them.

Source: ahajokes.com

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Balancing the benefits and costs of BPO

Benefits

Economies of Scale

Economies of Scope

Economies of

specialization

Cost

Transaction costs

Information asymmetry

costs

Dependency costs

Knowledge transfer

costs

IP protection

Cost mitigation

Seek proven referenced

Maintain contractual

flexibility

Build sold governance

structure

Encourage smart use of IT

In BPO (BPM, EAI, Web

services

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Create the governance model

Choose the overall governance model:

Choose a partnering or contractor relationship.

Determine the joint organization:

Identify the champions, evangelists, subject matter experts (SMEs),change leaders.

Involve vendor(s) with some of the softer aspects, such as changemanagement.

Identify and select the ESP team members to work with your team.

Feel free to choose these people yourself to give you a comfort level.

Gain support of outsourcing staff they must be enthusiastic. Reconcile your processes and culture with the outsourcing vendors.

Keep vendor employees motivated and stimulated:

Their buy-in is key to your success!

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Every sourcing strategy has limitations and risks. You must recognize,

plan and manage the unique requirements of offshore BPO sourcing.

Differentiate between unique offshore issues and pure outsourcing

ones.

Build meaningful plans for communication and clearly define options for

employees affected by outsourcing

Recommendations

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Case study: Technical support services- leading global PC manufacturer

Client

situation Impact The clients basicneed was to improveservice levels forsupport of PC products

and peripherals. Clients productswere supported bythird party providers inthe US.There was also aneed to reduce contact

costs at least by 30%.Improving first timeresolution was acritical SLArequirement.Client already had offshored into Ireland India and Philippineswere considered asthe next destinations.

The Transitionteam visited theclient sites for aduration of 3 weeks.

Mapped theexisting processesand reviewed thedocumentationavailable.People profile wasidentified and

Training needschalked out. Technology wastested andconnectivity wasestablished.

Pilot for both voiceand email waskicked off within 90days of transitionfrom our Delhicenter.

We haveramped up by30X from the pilotstage.

Mumbai wasadded as anadditional site.

Service windowsexpanded to 24*7

Today, weprovide Technicalsupport (L1-L2)and problemresolution forretail and SMEcustomers fordesktops,portables andperipherals.

Our

solutionTransition Operations

The scope ofwork hasincreased fromone division to

multiple divisionsin the company.

#1 in FTR SLAworld-wide acrosscall contactcenters of the

customer.Target: 72%Achievement:85%

C-Sat ratingTarget:85%Achievement:90%

After an exhaustivedue diligence, theclient chose India andus as the partner to

pilot.

Initially, e-mailsupport was chosen asthe channel sincethe client hadmisgivings on voice

quality from India.

Recommended a pilotwith voice and email which the client agreedto.

Performed an onsiteanalysis to firm up theschedules and plans.

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Client

situation Impact

The client operates20 call centersworldwide with 11 inthe U.S and nine

outside. These centers arestrategically locatedaround the world tomaximize efficiencyand ensure higherservice levels to their

customers. 6500 call centerrepresentativeshandled more than 91million customers Focus on improving

customer experienceand reducing costs ofrunning a widespreadnetwork, theyoutsourced selectreservation processes.

A cross functionalteam of SubjectMatter Experts(SMEs) was sent to

clients onsite. The SMEsconducted a detailedstudy of existingprocess tounderstand, validateand adapt existing

process to makethem remotecompatible.Transitioned theprocess offshoreusing the Transition

Tool Kit. Clients trainerstraveled to India totrain the first batchof Technical SupportEngineers (TSEs).

Connectivity withclient systemestablishedthrough dedicated

Voice and Data T1connection atMumbai.

Service windowsexpanded to 24*7.

Operations teamhas the overallresponsibility ofmaintaining SLAs,quality metrics,resource planning

and operationalissues. Team size of350 FTEs.

Our

solution Transition Operations

End CustomerSatisfaction

Decreasedaverage handle timeby 18%

Improved Process

Consistentlyoutperformed theclient defined SLAs

for the quality ofcall handling

Cost Saving

For Phase 1, aninitial customer

service cost savingof US$12-15 Millionper annum hasbeen projected overa 2 year period

Used a structuredtraining methodologyto transition keybusiness process.

The transition ofthese processesensured 24X7services.

Specific techniques

such as dialoguemodeling acquiredduring training assistsefficient customerhandling.

These techniquesare adhering to all theguidelines of the U.SDepartment ofTransportation.

Case study: Customer interaction services - leading US airline

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Case Study: Back office underwriting leading UK based insurance firm


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Client

situation

The UK Insurance marketis dynamic with immensepressure on the companiesto increase their market

share, revenues besidesbeing mindful of the pricewar and pressure fromreassurance companiesand the govt. regulations.

To quickly identify an

outsourcing organization,which can take on tasks ofunderwriting and policygeneration and help the UKinsurance company tofocus more on marketing

and sales of their productsand help them becomeprice competitive.

Started with pilot of 70

FTEs for:

- Initial underwriting

- Senior underwriting- Data capturing of Life

Policies

Critical performance

management measures

taken corrective

actions and weekly stackrankings

WSM performed better

on all parameters for

Indexing, data Capture,

Initial and Seniorunderwriting

Our

solutionOperations

Client has achieved costefficiencies and flexibility;thereby in a position tooffer better price in their

market due to increase inmargins

Client would be in a betterposition to focus on directmarketing and productdevelopment

Faster time-to-market

Reduced operating risks

Client has released the

success of the project andis ramping up to 250 FTEs

Wipro Spectramind

solution built around:

- ability to identify and

train the resources- technological capabilities- ability to scale up- establishing detailedprocess metrics andbaselines

Detailed risk mitigationstrategy worked out withthe client

Impact

Case Study: Back office underwriting - leading UK based insurance firm

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Offshore BPO: Continued value over time


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Cost arbitrage

Process

efficiencies

Optimization and

consolidation

Sample

Process

LaborArbitrage

Minimum

Quality

Better Process

Stiffer Quality

Process Improvementsby leveragingdomain expertise

Evaluatingautomationoptions

Best in Class

Consolidationacross globaloperations / callcenters

Optimizeprocesses

Maximize savingsthrough better turn-

around andreduced defectrates

Phase I

Phase II

Phase III

Increasing

customer

value

Time

Offshore BPO: Continued value over time

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Service delivery framework


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Process

knowledge Horizontal

Vertical

Strong

program

managementcapability Change management

Transition management

Technology

platform

expertise Enterpriseapplications Domain specific

Superior

quality and

execution

excellence

Innovative

people

practices

Robust global delivery model

Economic benefits

Significant cost savings to clients Incremental revenue at lower cost (e.g. telesales)

Operational benefits

Meeting & exceeding Critical performance Measures/ SLAs

People benefits

Higher customer/employee satisfactionscores for clients Better talent mgmt.(e.g.

low attrition, higher skillsupgrade)

P3

Creating world class business processes

Power

of P3

Service delivery framework

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Thank you for attending the webinar

You can send feedback or ask for more

information by emailing us at [email protected]

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