“How do we re-brand outsourcing” was the rallying cry at the NASSCOM BPO Summit in Gurgaon, India, this week. Easy – let’s call it something else… with two-thirds of the buyers and providers voting to drop the term, all we have to do now is agree on a super cool new set of words, and the industry’s current image problems will soon become old wives’ tales.
So let’s take a look at the renaming options each industry stakeholder group has voted for (this is for BPO – we asked about ITO separately) :
The beauty of this table is that it doesn’t require a whole lot of analysis. Buyers are so at a loss for alternatives, they couldn’t think of much else and “Outsourcing/BPO” actually came top. Most of the providers just want to swap out “outsourcing” for “services”, while most advisors stuck with BPO, with a growing number, mainly the management consultants, pushing the Global Business Services badge (even though GBS is supposed to represent all forms of sourcing being managed under a holistic governance framework).
The outsourcing industry has a lot of work to do, if it wants to “re-brand”
There is far too much “believe our own bullshit” going on and this industry needs to change how it perceived before it can effectively “rebrand”. People in the industry are complaining that the ignorant masses confuse “outsourcing” with “offshoring”. Well, I hate to be the bearer of bad news, but isn’t the vast majority of ITO/BPO dependent on offshore labor to make the economics work? We should probably just call it “offshore outsourcing” to be even more accurate (eek!).
Look – we all want non-linear growth, to focus on business outcomes, value creation and innovation. We desperately want this industry to be making fast progress in overcoming the four challenges of the HfS 50 Blueprint Document.
The Four Blueprint Challenges facing the outsourcing industry:
» Challenge #1: How can we overcome this singular focus on cost that strips the industry of its value?
» Challenge #2: How can we leverage outsourcing as one of a variety of vehicles to achieve business objectives?
» Challenge #3: How can many of the service providers invest smarter in their account management teams?
» Challenge #4: How can buyers and providers really partner to foster innovations into business process outcomes?
Until these four challenges can be tackled, rebranding the word “outsourcing” is a futile task. Re-branding is all about changing perception – hence, today’s business leaders must be able to associate “outsourcing” with business value creation and true value-partnerships with service providers which are instituting new capabilities into their businesses.
The Bottom-line: Once the outsourcing industry can prove to the world it is evolving, we can use smarter terminology
Yes, “outsourcing” as a term doesn’t convey business value creation, or innovation, or achieving nimble global operations, but this industry needs to demonstrate it is genuinely moving away from the labor arbitrage model, before we can rightfully name it something different. Yes, many new client/provider relationships are now moving in this direction, but we need to see more of it – and have more of it communicated to industry.
Personally, I like the term “business services partnering” as – in many cases – the entire function is not actually outsourced – only elements of it, so in effect these engagements are partnerships with providers to deliver operations, not the outsourcing of operations. Don’t get me wrong, the “O” word will go away – and we – at HfS – will only use the term when we have to , but the industry needs to prove it is winning the battle of the Four Blueprint Challenges before we can genuinely use new terminology without feeling like we just applied some more lipstick to Ms Piggy.