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The Benefits of BPO Realization - Page 1

Dec 14, 2006
By

Mark Cioni






The business case for a BPO (business process outsourcing) initiative may be relatively complex or very straightforward, but a “build-it-and-they-will-come” paradigm can dilute even the best strategy.

Organizations too often implement BPO, then expect the anticipated benefits to become manifest as a fait accompli. Predictably, the villagers set about burning the windmill when the benefits fail to make their command appearance. The monster, unfortunately, escaped very early on in the form of a belief that benefits “just happen” if the business case is sound.

Business case realization provides the framework for bringing the benefits anticipated from BPO initiatives to fruition. It is a proactive, continuous process to understand, measure and achieve predictable and sustainable business value.


Instead of asking “Are we there yet?” business case realization ensures we understand progress, make course corrections as necessary and, most importantly, that our destination is still viable. This approach is ideally incorporated into the BPO initiative from the start, touches multiple areas and disciplines within the initiative and is not as easy as “wait and see,” but it works out much better in the end.

Now that you’re sold on “what and why,” let’s look deeper at how business case realization works via some key attributes of this approach:

Outcome Focused: The business case is the compass that specifies benefits in terms of the outcomes, associated measures and value. Beginning with this end in mind, business case realization must develop the activities, resources, accountability and measures needed to achieve those benefits.

If this sounds a lot like program management, you’re right, and it’s one of the key disciplines aligned with this approach. The outcomes also establish traceability, and there needs to be a clear line of sight between BPO benefits and organizational imperatives.

As a simple example, consider a utility delivering electricity and gas to its customers that outsources the design of its pipes and wires infrastructure. If the organization subsequently decides to focus just on operating the infrastructure, the benefits associated with outsourcing design will likely change, and even more importantly may not even be viable goals for the future.

Proactive: Anticipating and controlling instead of reacting is a key enabler for business case realization, and pays big dividends with stakeholders.

Although each BPO initiative is different, key groups such as the providers, management, employees and customers will be involved to a great degree, and it’s important to get ahead of the curve. For example, have you helped to create a strong linkage of shared accountability between your management and all BPO providers? Do the providers look at this as just a service level agreement (SLA) or do they really understand the interdependency of their services on your operations and ability to provide customer value?

Conversely, does management view the providers as just more vendors to beat up when they screw up, or have they taken the right steps to ensure seamless integration between the services they provide and rest of the organization, such as making key resources available for knowledge sharing?

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