Business Process Outsourcing (BPO) is the
delegation of one or more IT-intensive business processes to an
external provider that in turn owns, administers and manages the
selected process based on defined and measurable performance criteria.
Outsourcing takes place when an organization transfers
the ownership of a business process to a supplier.
The key to this definition is the aspect of transfer of control.
This definition differentiates outsourcing from business relationships
in which the buyer retains control of the process or, in other words,
tells the supplier how to do the work. It is the transfer of ownership
that defines outsourcing and often makes it such a challenging, painful process. In outsourcing, the buyer does not instruct
the supplier how to perform its task but, instead, focuses on
communicating what results it wants to buy; it leaves the process
of accomplishing those results to the supplier.
Some of the factors that are making outsourcing popular are:
» Factor Cost Advantage
» Superior Competency
» Utilization Improvement
» Economy of Scale
» Business Risk Mitigation
» Rapid access to high quality
» numerous and readily-available IT professionals
» Wide range of technology skills available
» Stringent quality control
» Shorter project delivery times
» Using the time difference to your favour, especially where the
offshore company provides support or maintenance
If a company has a true commitment to its customers,
it will want to service them equally well in every phase of the
customer life cycle. Improved business process efficiencies and
the associated increased customer satisfaction are achieved through
the implementation of highly integrated business systems.
Mastering the Moving Target: CRM Business Market Sensing Findings
"Everyone wants to go to heaven, but no one wants to die"
The above quote endorses a significant finding of a recent study
conducted by business intelligence firm, Bearing Point on CRM. Clearly,
CRM is a necessity for successful business! The Bearing Point study
shows that the vast majority 82 per cent of IT users view CRM as
important, but only 37 percent are achieving the targeted performance
. The expected benefits of CRM include increased bottomline/ financial/market-share
performance, higher customer satisfaction/loyalty and more information
about and a better understanding of customers.
According to Forrester research, in the United States alone,
91% of small to medium sized companies, and 63% of mid-market companies
already outsource their web site placement. By 2004, Forrester estimates
those percentages will rise to 99.7% for the subject matter experts,
and 83% for the companies.
STAMFORD, CONN., July 7, 2003 — Offshore business process
outsourcing (BPO) is expected to reach $1.8 billion in
2003, a 38 percent increase from the 2002 total of $1.3 billion,
according to Gartner Inc. (NYSE: IT and ITB). In 2003, offshore
BPO will represent 1.5 percent of the total BPO market.
Why CRM is important?
The vast majority of respondents cited three primary reasons
why CRM is critical to their business success:
39% acknowledged customer relationship and satisfaction.
34% stated that CRM was important to set them
apart and for differentiating their organizations in the marketplace.
23% noted that rising customer expectations lead
to the implementation of effective CRM strategies by organizations.