"Best Practices" are formed through the experiences of firms innovating and trying out new ways of doing things. So – in reality – that means they’ll tell you where they messed up and give advice on how they got it right (or how they would do something differently second-time around). BPO is no exception… in fact, it’s probably a shining example of how to learn from others’ mistakes
Here, in my experience, are the most common mistakes companies have (and many still are) making when evaluating BPO:
1. Poor communication to key staff: if a company is going to explore outsourcing its business processes, it needs to evaluate how it is going to gather the information it needs to support its decision-making. If – as in most cases – it is going to bring in a consultant/adviser to develop a business case, then the advisor will need to talk with key staff to access data, conduct interviews etc. The minute staff get wind of the fact consultants are in discussing the "O" issue, panic will spread and all sorts of strange behavior can occur. The rumor mill, staff turnover, politicking… believe me, when staff start worrying about their jobs, all hell can break loose. You must identify which of your key staff is needed to conduct the business case, and be open with them from the get-go about what you are evaluating. You have to explain their jobs are not on the line, if you want their support. And you need their support because resistance from staff can destroy the process.
2. Failing to weed out the dissenters: I cannot tell you have many BPO evaluations have led to "no-go" decisions because some key people simply were not onboard with the process. If a function leader is highly resistant to the BPO, he / she will attempt to derail the process at every possible opportunity – and it will most likely fail. If you try and transition a function where no-one is playing ball, you are in serious trouble from the get-go. Constructive criticism and healthy discussion of the issues are important, but some people will be against change… and will never change. Have open and honest talks with key staff about BPO – many simply will not understand much about it. Having a group workshop – perhaps with an independent expert present – will be very helpful in educating your staff. BPO is not rocket science and you will quickly understand who is onboard and who will never be. Then you can make whatever decision is needed to get over that hurdle. You may find your company simply does not have people who will allow this to happen – so why not save everyone’s time and money and call a halt to the proceedings before a load of time and money is wasted?
3. Not involving HR: BPO is all about people, job roles, staff reductions, knowledge transfer, training and change-management… hmmm sounds like something HR should help with to me. Too many companies get excited about the economic benefits about BPO and fail to devote enough time and resources towards dealing with the human capital issues regarding how they can execute. And if HR isn’t onboard, you have another serious problem….
4. Not involving IT: BPO always involves a certain amount of process re-design and standardization, and there are always critical issues with data security and privacy that need addressing. Any changes you need to make, will need to be supported by your existing technology platform and IT staff. This doesn’t mean you need a major IT evaluation from stage 1, but having a firm understanding early on of the IT issues and opportunities a BPO engagement will create, can save many headaches down the road. I am actually seeing many companies explore BPO as a result of all the work they have done rolling out new ERP software. When you need to invest so much money in re-designing process and re-training staff, wouldn’t this pose the ideal time to look at outsourcing some of it?
5. Not using a good advisor: You will likely need an advisor to help facilitate the various stages of the BPO process. Beware of any advisor which fails to tell you any of the points above. You must make sure you use one who is going to do more than merely facilitate a transaction, and can talk from experience on how to avoid making these types of mistakes. Get them to tell you how they can help you work through these issues.
At the end of the day, evaluating BPO can pose several issues for firms if they do not address these issues correctly. Yes, BPO can offer firms cost savings and the opportunity to add rigor and standardization to their processes. However, if you don’t go about evaluating it correctly, you may never get the chance to find out.
Evaluating BPO… it’s all about avoiding pitfalls early on