Business Process Outsourcing

Transcription

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2 Business Process Outsourcing

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4 Business Process Outsourcing A Supply Chain of Expertises Vinod v. sople Professor and Deputy Director (Academics) ITM Business School Navi Mumbai New Delhi

5 BUSINESS PROCESS OUTSOURCING: A Supply Chain of Expertises Vinod V. Sople 2009 by PHI Learning Private Limited, New Delhi. All rights reserved. No part of this book may be reproduced in any form, by mimeograph or any other means, without permission in writing from the publisher. ISBN The export rights of this book are vested solely with the publisher. Published by Asoke K. Ghosh, PHI Learning Private Limited, M-97, Connaught Circus, New Delhi and Printed by Mudrak, 30-A, Patparganj, Delhi

6 Contents Preface Acknowledgements xiii xv Chapter 1 SEARCH FOR COMPETITIVENESS 1 19 Paradigm Shift 1 Competitiveness 2 Competitiveness at Firm Level 3 Evaluating Competitiveness 5 Staying Competitive 13 Achieving Business Transformation 14 Business Model for Competitiveness 15 Competitiveness Mantra 16 Summary 18 Review Questions 19 Chapter 2 NEED FOR OUTSOURCING Introduction 20 Why Outsourcing? 22 Scope of Outsourcing 24 Outsourcing: A Catalyst for Change 24 Outsourcing: Beyond Cost Advantage 25 Outsourcing: IT and Business Processes 26 Outsourcing Guidelines 26 Cost 27 Communication 27 Performance 27 Risk Management 28

7 vi Contents Crisis Management 28 Knowledge Transfer 28 Relationship 28 Outsourcing Issues 26 Outsourcing Best Practices 29 Summary 31 Review Questions 31 Chapter 3 BPOs: BEYOND CALL CENTRES Introduction 32 Call Centres 33 Evolution of Call Centres 35 Captive Call Centres 38 Call Centre Technology 38 Success Factors in Call Centre 39 Business Process Outsourcing (BPO) Vendors 39 How does BPO Work? 41 BPO Service Scope 42 Benefits of BPO 42 BPO and IT Services 43 Project Management Approach in BPO 45 BPO and IT-enabled Services 46 Indian BPO Industry 47 Summary 48 Review Questions 49 Chapter 4 TRANSITION MANAGEMENT Introduction 50 Transition and Change 52 Managing Transition 52 Expanded Boundaries 53 Role Clarity 54 Responsibility Allocation 54 Experimentation 54 Job Content Revision 55 Training 55 Learning 55 Employee Orientation 55 Efficient Communication 56 Organizational Loss 56 Retention 56 Extending Help 56

8 Contents vii Framework for BPO Execution 57 Analysis 57 Planning 57 Transition 57 Control 58 Improvement 58 Summary 58 Review Questions 59 Chapter 5 BPO BUSINESS MODELS Introduction 60 Business Models 61 BPO Challenges 62 Types of Business Processes 64 Strategy for Business Process Outsourcing 65 Process of Outsourcing 66 ITO vs. BPO 66 Classification of BPO Outfits 67 BPO Models 69 Summary 76 Review Questions 76 Chapter 6 BPO GOVERNANCE Introduction 77 Corporate Governance 78 Indian Perspective 80 Ethics in Decision-making 80 Practices in Place 81 Challenges in BPO Industry 82 Security Management 83 Ethical Hackers 83 Code of Ethics 84 Reporting Procedures 85 Model for BPO Governance 86 Self-governance 87 Approach to Governance 88 Best Practices 90 Summary 90 Review Questions 90 Chapter 7 LEGAL ISSUES IN BPO CONTRACTS Introduction 91

9 viii Contents Intellectual Property Rights 92 Transfer Pricing (TP) Guidelines 93 Data Security 94 Other Issues 95 Laws in International Contract 96 Indian Courts Choice of Law 96 Guidelines for International Contracts 97 Business Goals 97 Service-level Management in Outsourcing 99 Summary 99 Review Questions 99 Chapter 8 BPO: REGULATORY ISSUES Introduction 100 BPO and Compliance 101 BPO Regulations: Indian vs. Global Scenario 102 DoT Restrictions 105 Customs Rules for EOUs and IT Parks 106 Property Tax SOPS for IT Firms for Road Projects 106 Income Tax 106 Privacy Laws 107 Regulations in Other Countries 107 Standardized Test for BPO Jobs 108 Taxing BPO 108 Tax Deduction at Source (TDS) 109 Regulations Amendments 110 De-constraining 111 COBIT 112 Cyber Laws 112 Summary 113 Review Questions 113 Chapter 9 SERVICE SUPPLIER SELECTION Introduction 114 Planning for Outsourcing Contract 115 Expectations from Vendors 116 Performance: Measures and Targets 117 Reducing Risk in BPO Contract 117 People Risks 118 Technology Risks 118 Process Risks 119

10 Contents ix Choosing the Right Contract Partner 120 Integrity 121 Commitment 121 Willingness to Listen 121 Responsiveness 121 Value Addition 122 Vendor Soundness 122 Proficiency 123 Summary 123 Review Questions 123 Chapter 10 SERVICE LEVEL AGREEMENT Introduction 124 Contents of SLAs 125 SLA Advantages 126 SLA Guidelines 126 Clarity in Roles and Responsiveness 128 Other Issues in SLA 129 Contingency Planning, Operational and Disaster Recovery 129 Access Control 129 Backups 129 Incident Management 129 Client Satisfaction 130 Independent Evaluations 131 Penalties and Rewards 131 Deficiency in Service 131 Summary 131 Review Questions 132 Chapter 11 BPO LEGAL CONTRACT Introduction 133 Contract Coverage 134 Dispute Resolution 135 Essential Elements of BPO Contract 136 Contract in General Terms 136 Training and Infrastructure 137 Scope of Service 137 Summary 143 Review Questions 143

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