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Business Process Outsourcing (BPO) Basics
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What Every Manager Needs to Know
You've heard the buzz, you've seen the deals that the Fortune 500 companies and your competitors are designing, but is your organization ready to reap the benefits of business process outsourcing (BPO)?
Before going any further, let's define the term. BPO is the act of transferring some of an organization's repeated non-core and core business processes to an outside provider to achieve cost reductions while actually improving service quality. Because the processes are repeated and a long-term contract is used, outsourcing goes far beyond the use of consultants. If done well, BPO results in increasing shareholder value. The main difference between BPO and more traditional IT outsourcing is that BPO offers companies a way of achieving transformational outcomes much more quickly.
In a typical BPO contract, a service provider takes over a specific corporate function. Effective BPO encompasses much more than just changing who is responsible for performing the process. In BPO, the outside provider not only takes on the responsibility to manage the function or business process, but also re-engineers the way the process has been traditionally done. Re-engineering includes implementing new technology or applying the existing technology in a new way to improve the process.
BPO's time has come. Managing BPO relationships is a skill every manager will need in order to survive and thrive in the global economy.
Source: http://www.ebstrategy.com