Should Companies Outsource Their Processes As-is or Transform and Improve Them First?

For many companies, Process Reengineering and Transformational Services are now a fundamental way to remain competitive and/or stay in business.  Companies must constantly reengineer/transform themselves or they risk falling behind the competition. Many organisations in recent years have reviewed their options for improving business processes and asked themselves if they should transform internally or consider outsourcing that part of the business to a third party service provider.  Unfortunately, we know from our work with clients that the decision is more complicated than simply determining whether to reengineer or outsource.  It involves deciding whether it is better to outsource business processes/functions ‘as is’ or to reengineer or transform those processes and functions before considering outsourcing them to a third party.

The added dimension of ‘timing’ of an outsourcing initiative introduces another level of complexity to the decision making process when considering how to address outdated or inefficient business processes.  The questions clients typically wrestle with are:

Should we outsource the selected processes ‘as is’, (in their current state)?

Should we transform the processes and then outsource?

Or should we take a ‘big bang’ approach and do both process reengineering transformation and outsourcing at the same time?

Option 1: Outsource As-Is

This means outsourcing the process and operations in their current state and delay any improvements and transformation until after the migration of services to a third party provider.

Table 1: As-Is option

This model is fairly common considering the range of outsourcing deals.  The primary reason is that the benefits of labour arbitrage are more immediate and translate into cost savings for the business sooner than any other option.  Delaying the beneficial impact of outsourcing until after transformation delays the benefit of labour arbitrage for typically 2 years.  Our analysis indicates this represents a delay of achievable cost savings of approximately £40k per FTE per year.  Those who choose to outsource immediately stand to generate cost savings over the cost of current operations in the neighbourhood of 25%.  A  recent manufacturing client taking this route outsourced it’s transactional finance processes and realized labour arbitrage savings of 30% in just seven months of making the decision. 

Option 2: Transform then BPO

The second option means the client chooses to transform the selected process(es) and implements systems improvements in house.  After these have been implemented the operations in their new ‘improved’ state are outsourced to a third party service provider. The following table shows the sequence of events and explains the benefits and drawbacks of this approach.

Table 2: Transform then Outsource Option

This model is popular in client organizations that are more technical in nature or that are engineering based businesses.  In these organizations the client typically has a strong and experienced IT organization and/or performance improvement teams who routinely manage and implement complex technical projects.  In a smaller number of cases the size of the client or the project is of such a scale that required changes are less complex, require lower level of knowledge or technical skills and can be manage by less robust internal organizations.

Companies considering this option should be particularly aware of the impact on costs and resources required to transform a business function prior to outsourcing.  These costs will invariably be ‘in addition’ to the costs associated with outsourcing that function at a later date.  The combined costs of the transformation and outsourcing effort may not be off-set by the cost savings associated with the labour arbitrage the company hopes to leverage as a result of outsourcing.  Furthermore, not all companies have the in-house technical, business process and organizational knowledge required to make such projects a success.

Option 3: ‘Big Bang’ – Simultaneous Transformation and Outsourcing.

The last option is doing both the transformation and outsourcing at the same time.  The sequencing of events is as shown below:

This option requires the following considerations:

1.  Timing
A potential benefit of this approach is that if managed well the overall length of the project could be shorter than in either of the two other options described above.  Less time invariably translates to lower costs to execute the programmes and an accelerated time to benefit as it relates to labour arbitrage.  The concern here though is whether the organization in question has the skills, knowledge and time to devote to such a large and complex undertaking.  Most organizations simply do not.
2.  Risk tolerance
Most organizations do not have the tolerance for risk that this option demands. Successfully resourcing and managing two major change projects simultaneously injects a degree of risk that companies typically can not afford to support, particularly over long periods of time.  When faced with spending more, and taking on additional risk or realizing more immediate savings (upwards of 25% of today’s cost) most companies opt for a shorter, less risky path to benefits.
3.   Cost
The cost of executing both process reengineering/transformation and outsourcing projects simultaneously rarely, if ever, are less than the immediate benefits that can be achieve by one of the other alternatives
4.   Investment capital
Significantly more capital investment will be required in support of this option as system investment; project management costs will be higher than they would be under the other two scenarios.

Conclusions

In summary, we have described three competing options that many companies face as they reengineer and transform themselves to remain competitive.  Furthermore, we have shown that the decision is not as simple as deciding whether to transform or outsource because the dimension of time forces us to consider the tradeoffs of different approaches.  

There are many aspects to consider when deciding the order of events and each option has associated advantages and disadvantages that must be taken into account.  The ‘as-is’ transition model is one we see most widely and the one that is most accepted because the ‘time to benefits’ tends to be minimized as compared to other options.

Ultimately the client must fully consider these options taking into account not only the time and costs associated with the projects themselves but also recognizing whether they have the kind of knowledge, skills and experience required to manage the complexities of each option. 

Finally, each outsourcing deal is unique and must reflect differences in company culture,  countries involved, processes to be transitioned, number of resources involved, the company’s current strategic/financial position, etc., all having an impact on the decision. Ultimately companies need to review and understand the risks and benefits of each option before deciding how much then can afford to take on.

4 Ways in Which Companies Can Use Surveys

Surveys used to be the exclusive domain of large companies who had a sizable budget. They would use questionnaires to identify branding issues in their marketplace, customer perceptions, sales potential for new products, and similar elements. Over the past decade, the obstacles that kept smaller companies from leveraging surveying technology have crumbled. More than ever, small businesses are using online surveys as a cost-effective channel through which to solicit valuable feedback from customers and prospects. This article will provide four ways your company can use surveys regardless of your size.

#1 – Employee Satisfaction

Your staff is one of your most valuable assets. They maintain control of the daily operations of your organization. As a result, not only is their satisfaction with their job important, but they have unique insight into their activities that could lead to bottom-line improvements. By surveying your employees, you can help lower staff turnover and improve the overall morale in the workplace.

#2 – Market Absorption Of Future Products

In order for your business to continue growing, you’ll eventually need to introduce new products or services to your customer base. Development costs can be prohibitive, especially for smaller companies. As a result, allocating limited resources to developing products without knowing whether your market will absorb them is risky. This is an ideal opportunity to survey your customers regarding their likelihood to buy your new product or service. If you take the time to do so before launching into development, you can avoid the risk of creating a product that debuts to meager, if any, sales.

#3 – Customer Satisfaction

Your business cannot operate successfully without customers. The challenge is keeping them satisfied. You should implement an ongoing surveying effort that continuously solicits feedback from your customers. Ask them whether they’re satisfied with the response and professionalism of your support personnel. Ask them to describe how they feel about your website’s shopping cart. You’ll also want their feedback on your products or services, including delivery, assembly, use, and overall satisfaction.

The value of using surveys to assess how satisfied your customers are with your company cannot be overstated. If they are happy, they’re more likely to be loyal and tell others about you.

#4 – Effectiveness Of Training Programs

Training programs often operate in a vacuum. A company’s senior management determines a need for the training based upon the requirements of new software, procedures, or strategies that add to the bottom line. Employees are sent through the program to learn the material. The problem is that once the training has been delivered to employees, its effectiveness must be measured.

Online surveys are particularly well-suited for this task. Students can complete short questionnaires immediately after the material has been presented. That allows them to offer feedback while the training – and its presentation – is still fresh in their mind. The employees’ responses can be easily fed into a database that establishes a baseline for future classes. Meanwhile, additional surveys can be used to assess how well the material is adapted in the workplace after the sessions.

The cost of designing and executing surveys has plummeted. Smaller companies are taking advantage of the easy availability of online surveying technology to access valuable information from their employees, customers, and their marketplace. For businesses that have yet to explore how this technology can help them grow, there is an ever-present risk of losing their competitive edge.

MARSHAL SOFTWARE ENABLES COMPANIES TO MANAGE EMAIL CONTENT.: An article from: Productivity Software

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Title: MARSHAL SOFTWARE ENABLES COMPANIES TO MANAGE EMAIL CONTENT.(MailMarshal)
Publication: Productivity Software (Newsletter)
Date: April 1, 2002
Publisher: Worldwide Videotex
Volume: 15 Issue: 4 Page: NA

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Offshore Staff, Virtual Staff: Why Hiring Outsourced Staff From Business Process Outsourcing Companies Considered the Perfect Business Solution

In today’s modern world, working with IT offshore staff – or any other kind of outsourced staff, online staff, virtual staff, for that matter – is no longer an impossibility. It doesn’t matter if they’re half a world away now, the wonders of information technology or business IT and split-second communication has facilitated the phenomenal growth of the Business Process Outsourcing BPO solution industry which effectively opened up tens of thousands of companies to explore the offshore labour hire option.

If until now you are still holding back or cringing at the very thought of staff outsourcing, here’s hoping that this article would make you rethink any preconceived notions you may have about contracting virtual staff.

Why Outsource Staff?

Contrary to popular belief, outsourced staff is not limited to telemarketers or call center agents. Besides IT offshore staff, more and more receptionists, copywriters, accountants, customer service specialists, marketing and personal assistants, SEO or search engine optimization services, web designers, developers, and administrators as well graphic designers and artists are becoming part of the much sought-after offshore staff labour hire force.

In the past, only large multi-national companies took notice of staff outsourcing, but company size is no longer an issue -even small and medium businesses now stand to enjoy the benefits of offshore IT staff labor hiring. Saving on labour cost is still the first and primary reason for outsourcing. Imagine contracting a qualified and experienced IT offshore staff for about 30 percent the normal cost. You can have a remote staff, online staff, IT staff, virtual staff or even a whole team of outsourced staff working efficiently on your projects even while you sleep. And take note, the quality of the output is second to none!

Another good reason for turning to offshore staff is the huge vacancies or gaps in the labour market. Since IT staff is very much in demand, there is often a shortage of applicants. Rather than settle for a newbie or wait a long time, some companies instead opt to BPO solution service of hiring an IT offshore staff to immediately fill in the position.

What Benefits Can I Get from Staff Outsourcing?

A major advantage of outsourcing staff from Business Process Outsourcing Companies are it levels the playing field between huge corporations and small and medium business owners. BPO solution of Offshore staff are providing them professional skills and talents they would normally be unable to afford.

One of the most wealthy and successful business owners Sir Richard Branson once said: “Building a successful business is about using your own skill strengths and employing people who possess the skills you do not have.” A business really cannot survive if essential skills needs are not met. Through outsourcing staff, any type and size of business can have unlimited and easy access to seasoned professionals – IT offshore staff are finally bringing them up to par with big name players – at minimum cost, and without sacrificing quality.

By outsourcing staff, you are also improving the quality of life of millions of other people across the globe. Although the cost of hiring offshore staff is relatively cheap for dollar-based economies, outsource staff consider this several notches higher than the income they would be receiving from their home country. Take the Philippines as an example, contracting an expert IT offshore staff from there would cost 70 percent less than hiring one from the US or Australia – but to them they would be making almost twice as much as the average salary – without ever having to go abroad.

How to Make the Choice Easier

Outsourcing staff from Business Process Outsourcing services can sometimes really be a worrying decision. These what ifs can take very long to resolve. Bear in mind however, that indecision may forever hold you from taking the leap and being in the league with companies who utilize outsource staff.

Here are some points to consider if you’re thinking of outsourcing staff:

Determine the staffing needs of your business or company before scouting for offshore staff.
Consider that there are companies which can provide you with dedicated IT offshore staff. This means that you don’t have to place ads and interview people – there are ready-to-hire outsourced staff who have already passed through the scrutiny of HR professionals.
Offshore staff are experienced and skilled – it will only take them a couple of days to get acquainted with the company and meet the demands of the job. You don’t need to teach them how to do the job.
Ask input from companies who have experienced hiring offshore staff – or any other kind of outsourced staff. See if they have positive or negative comments about the offshore staff they’ve contracted.
You may try outsourcing staff according to your company’s needs, be it part-time or full time. But you also must consider that dedicated outsource staff is more advisable if you have continuous workload.

Of course, even outsourced staff needs to feel that they belong to a team. Even your virtual staff would need motivation and encouragement from you and the rest of team to continuously deliver on time and top-caliber work. By embracing outsource staff as members of your team, they’d be more inclined to work and be more committed to you and your business.

Deciding now

With today’s current trends, you’d definitely have more to gain when you measure the cost-benefit of contracting offshore staff from a trusted Business Process Outsourcing Company. These are just some of the advantages of outsourcing staff to make your business more successful. The real deal will be apparent when you yourself experience the life changing effects of having these virtual staff working for your projects. More and more technological advances are now being used to ensure quality work for your money’s worth. You can be assured that many offshore staff providers equip their clients with tools to specifically to help them manage and work effectively with their BPO offshore staff.

Some of which are:

An HR manager for every outsource staff they provide you.
Tools such as the screen capture designed to check the progress of your offshore staff; and
Online sheets and communications tools.

The benefits you can get through outsourcing staff from a trusted Business Process Outsourcing Company are very significant; they are real and are really accessible even for small business. It allows companies to cut costs, provides benefits to consumers with lower costs good and services, causes an economic expansion that brings down the level of unemployment and brings up the level of productivity and job creation. Hiring offshore staff is just one of the things that globalization has brought along, best to embrace it and make it work to your advantage. So go ahead and try out one or two outsourced staff for starters. Who knows, maybe outsourcing staff really is the best solution for company’s problems!

Surveys Online – Market Research Companies

If you look around on the internet, you will find a lot of marker research companies that are willing to pay you big money to take part of their surveys online. If you are wondering why they are doing this and how does it work, you may find some of your answers right here.

Why are they paying you? The most important reason is that they need you. You are the consumer and you know better what you want and for what are you willing to pay and they need this information to keep their business going.

Also because people are very busy and don’t have time to answer the survey for free they had to find a way to get the information they need so they pay you. Just think if you would answer a survey for free!

Surveys online are convenient both for the market research company and for the respondent. The company will pay less for commanding the survey and you will sit home, answer the questions and get the money. Traditionally, a face-to-face interaction was needed when conducting a survey and the company would pay a lot of money and let’s don’t mention the time they spent.

The marker research process is another reason. Organization may decide to conduct a market research themselves or they might choose to hire a specialized research company, but before doing this defining the research objectives is crucial. After this, market researchers can use many types of methodologies and research techniques to capture the needed data. All of the available methodologies collect either quantitative or qualitative information and the use of each depends very much on the research objectives.

When companies need market research they turn to surveys online conducted by specialized companies. For taking the survey all these companies offer some compensation which differs from company to company.

For conducting surveys online you might check out Question, which is a web based service specialized in this domain. Using their online survey software the process is simple, just use the intuitive wizard interface for building your survey, than use the integrated email system to send invitation and view your reports online automatically.

Conducting surveys online is not a problem because the number of market research paid surveys online has increased due to the new telemarketing laws. Both the respondent and the clients have something to win from this because there are no geographical barriers and the benefits increased for both. In these cases everyone wins, the person taking the survey online and the company that is receiving the information.

Feel free to visit some of my sites Paid Surveys and Surveys Online

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