Innovation starts at the... cube farm

January 21, 2014 | Phil Fersht

Big data, outcome-pricing, "transformation", process transmogrification, value thresholding... all big words indicating big ambitions, but they'll mean squat if your only real strategy is to keep cramming more and more bodies into the same space to drive down costs.

Non-linear growth and outcome-based services in full swing

It may work for United Airlines, but with BPO, all you'll end up with is the bottom of the barrel choice of talent and more "chop shop" comments from Chuckie Schumer.  And, once you've run out of floor space and your company is too cheap to rent more, your only choice will be to hire robots, which aren't programmed to complain about working conditions or undertake industrial action. Unless, of course, they become self-aware and send a re-conditioned Arnold Schwarzenegger on a mission to Nasscom.

So, without further ado, we asked HfS' own cube-farm specialist Charles Sutherland, to take a look at what the delivery floor of the future may just look like...

Getting Beyond The “Lights On” Standard for Delivery Center Floors

There can be few places more soul-sapping over time than the standard, traditional shared services or BPO delivery floor made up of endless rows of nearly identical cubicles with a few dated operational metric posters tacked to the walls.   Whether that’s your daily work environment or you are there on a floor walk as a client or advisor, you probably hoped as the hours passed that the colleagues on the floor were engaging and providing a spark of innovation and excitement otherwise the days (and nights) just seemed to go on forever in these bland and joyless workspaces.

We got to this dire state as a result of a fixation on controllable cost management above all else.  In particular by focusing in on the expense components of seat charges to help create “value”.  And as an industry we were effective, we shrunk the size of cubicles, minimized the “add-ons” and worried about seat utilizations so that the delivery floor became a predictable and controllable cost in an era lf “lights-on-outsourcing”.

Then as an industry we wondered why employee attrition stayed high, why innovation seemed to trickle rather than flow from operations and why our service provider teams weren’t as connected to the business outcomes of our clients as the occasional logo poster above them suggested they should be.

HfS believes that the BPO marketplace is in the midst of a significant change, as the majority of clients have ambitions to move from a model of “lights-on outsourcing” to “progressive outsourcing”.  However, many of the elements of “progressive outsourcing” are so fundamentally different from where this marketplace has been languishing for the last twenty years, there is, in essence, a chasm to cross, in terms of the level of change management needed to discard the legacy enterprise practices and/or the ageing capability models that are in place throughout much of this industry.

A recent discussion with Accenture sparked the thinking at HfS with regards to how the introduction of new ideas and investments to the delivery center floor plays another important role in this transformation journey towards “progressive outsourcing”.  We noticed that how delivery floors are structured, how the offices and desks are laid out, and the ergonomics of the environment can have a monumental impact on the overall effectiveness of the team and the results that it can achieve.

For all service providers, reforming the model of the BPO delivery floor has the potential to create additional client value and help cross the chasm to “progressive outsourcing” in four ways:

  1. Heighted Collaboration – New collaborative models inside BPO teams and together with clients is a central to the value to be created by “progressive outsourcing”.  By creating new formal and informal ways to collaborate facilitated by technology and ergonomics, these new delivery floors encourage BPO teams to go beyond base delivery of the transactions and work together to solve problems.
  2. Rapid Testing of “What Ifs” – client value is further created by BPO delivery, when the very nature of the process and delivery is continually challenged and improved.  Providing a delivery environment where teams have access to client and industry data with the spaces to meet and conduct “what if sessions” helps to foster a delivery culture of not just process excellence but process improvement and innovation as well.
  3. Industry Acumen – delivery floors can create additional industry acumen on the teams by providing easier access to industry benchmarks in real-time using innovation rooms and easy to access visual displays across the floor to increase awareness of industry norms and trends.
  4. Reduced Attrition – one of the primary drivers of excessive unmanaged attrition in BPO delivery is just simply that the work environment BPO employees may be asked to be part of just aren’t very nice.  By brightening up floors, making management more integrated into the floor with command center stations (without them having to stand behind everyone all the time) and just generally making a more pleasant work environment, there is every reason to believe that valued BPO employees will be more motivated and committed to their clients than before.

Charles Sutherland is EVP Research and Guinness, HfS (click for bio)

Leading service providers are opening up to the possibilities that the delivery floor can be a driver of change in how processes are delivered and the value that is created, and, in doing so, the new delivery floor becomes yet another tool to help move the marketplace towards “progressive outsourcing”.  At HfS we look forward to future floor walks in these delivery centers and discovering all the new benefits they have brought to clients, service providers and employees.

Find more on Accenture’ approach to “The Delivery Floor of the Future” and our case for moving beyond the “lights-on” delivery floor in our new point of view - Innovating the Delivery Floor Model to Help “Cross the BPO Chasm”.

Charles Sutherland is EVP, Research at HfS. Click here to view his full bio

 

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