Posted on 03 April 2013.
By Martin Conboy
Outsourcing (which includes the terms BPO, shared services and a host of other industry classifications) is still one of the fastest growing and most dynamic industries in the world today. This growth and dynamism, however, has created a complex and fragmented market place that’s difficult for potential buyers to navigate.
Providers are merging, diversifying and constantly adding new services to their portfolios. It’s a challenge for buyers to keep up to date of who’s who in the market, what’s their value proposition, where are they located, and how to evaluate their different service offerings.
Peter Springett, Project Leader for theOutsourcing-guide.com, a new online directory and media service for the outsourcing industry, comments, “It’s hard for people to keep up with what’s happening in the marketplace. Players that were there one day are gone or have joined forces with someone else the next.”
“And traditionally people think of India or maybe the Philippines when they think of outsourcing or offshoring. But the reality is that there are numerous countries and regional economies out there with extensive industries established, offering a range of benefits and incentives.”
It’s a big world out there!
There is a multitude of service providers, many with specialist domain expertise, who are fighting to be heard in what is becoming a very crowded and sometimes shambolic marketplace. Up until now there has been no level playing field.
Quite often it’s a lottery trying to nail down who is who in the zoo. The market is sometimes chaotic and unstructured, and because of this uncertainty, there is always a flight to quality, a sensible choice but usually the most expensive.
When outsourcing, BPO and shared services first emerged in the nineties, the focus was purely on cost. Western corporations adopted a ‘shift and lift’ approach, shifting a section of their non-core business operations to a low cost location.
Current trends in the Industry
Outsourcing has evolved into a very sophisticated and complex art form. Price is no longer the only driver for organisations looking to outsource their business processes. They expect their outsourcing relationships to add strategic value.
Across the globe, companies are being stretched to offer superior customer service. For many industries, as competition turns products and services into commodities, the ability to offer superior service, cost effectively is seen as a key differentiator.
To meet these expectations, service providers in the major markets are trying to maximise their productivity by establishing bigger centres to attain the resulting economies of scale. They are offering something called a “Pan Global Delivery Model”, where work is routed to the most cost effective location and where the required skills are located.
Crucial to the successful delivery of this model is technology. Rapid technological advance has gone hand-in-hand with the evolution of outsourcing. The Internet, cloud computing, social media, and a host of other technologies have not only created new industries and established new customer communication channels, they have made most of the work done by an organisation placeless. And if the work can be done anywhere then it can be done by anyone.
In the developed economies of North America, Europe and Australia it is getting harder and harder to find people able and willing to work in front office call centres or in back office outsourcing facilities.
And as costs for doing business continue to rise in these locations, particularly places like Australia, the resistance to sending work offshore is diminishing. It is hard to argue against transaction costs of US$0.50 compared to over US$4 per transaction in the US, Europe and Australia.
Despite the growth, continuing maturity and growing professionalism of the industry, there are still a number of risks associated with outsourcing and off shoring. These may fall under the general categories of:
- Inadequate service provider infrastructure
- Quality of outsourcer personnel
- Inability to culturally assimilate with end user customers
- The operational transitioning process
- Hidden inefficiencies in the outsourcer’s environment or lack of experience by the outsourcer in the principle’s core market.
Making sense of it all
Seeing the gap in the market The Sauce and Word Labs decided to ‘curate’ the market. In much the same way as a curater in a museum curates the artifacts and puts them into the relavant sections so that they are properly organised, assembled and easy to find.
TheOutsourcing-Guide.com aims to be a definitive straightforward compendium to the vast range of solutions and services available in the Global Outsourcing, BPO and Shared Services marketplace.
“The Outsourcing Guide will rapidly become the logical place to connect with both sides of the buy/sell equation. From novices to veteran campaigners it is the one location where you will find everything you wanted to know but were afraid to ask about outsourcing and shared services”, said Mark Atterby, Editor of The Sauce (www.thesauce.net.au) one of the Joint Venture partners.
“Already as we are just softly rolling the site out , it is getting immediate traction from all over the world ‘ Said Sritharan Vellasamy, CEO &Founder of Wordlabs Global, an Asian based publishing house and the other JV partner. www.wordlabs.com.my “What the outsourcing guide does is put all of the service providers in an easy to use compendium organised by category and type of service offered,” he continued.
Reconising that many countries have highly skilled and educated work forces that can be easily accessed via the internet and modern online collaberation tools , and the rise and rise of online employment platforms like freelancer.com, the guide will also breaks out by information by geographic locations and the various benefits offered by each distinct geographical location be it The Philippines, India, Australia, New Zealand, Malaysia, Mauritius, South Africa etc
theOutsourcing-guide.com is the ultimate reference guide for the BPO and outsourcing industries and it will become the most comprehensive resource for organisations looking to engage outsourcing service providers. As well as providing a range of eBooks, articles and whitepapers explaining the various aspects of BPO, theOutsourcing-guide.com provides an online directory of providers segmented by category and location.
If you are interested in promoting your business or if you want to find a quality outsourcing service provider you should visit www.theoutsourcing-guide.com