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January 2014 | Outsourcing Blog | BPO Industry Updates and Articles

Major Mistakes in Outsourcing Contracts

by: Sarah Joson

Wednesday, January 29, 2014 | Comments (0)

Category: Outsourcing Research / Trends

Outsourcing service providers are often criticized for failing to deliver what is expected of them. But as it turns out, it’s probably not entirely their fault.

Mistakes in outsourcing contracts

In MooD International’s "State of Relations in Outsourcing" report which was participated by 201 senior managers and directors, it was found that inconsistencies during contract creation cause providers to miss the mark. One of the key culprits for the inconsistencies is miscommunication.

SupplyManagement.com stated in the report that trust, transparency, innovation, and having a deep understanding of the business model are the usual problem areas of a client-provider relationship.

The study also showed that clients gave their relationships with outsourcing providers a score of seven out of 10, and among board members, it falls to six out of 10.

Sixty percent of the respondents said they are willing to authorize providers to make decisions, and a little over 60 percent believe that it will make an impact and drive value to a business.

George Davies, CEO of MooD International, said trust is one of the things clients and providers need to work on so that the latter will be more comfortable in making the right decisions. Furthermore, he said service level agreements (SLAs) should be double-checked if it is consistent with the requirements of a business.

Meanwhile, 90 percent of the survey respondents stated that continuous communication is crucial to them and for this category, outsourcing providers only scored six out of 10.

Nearly 75 percent said they only focus on service levels rather than the outsourced operation’s business impact. Half of the survey participants said they employ outsourcing partners to deliver business transformation. Twenty-nine percent were found considering multisourcing for their business while 11 percent stated that their in-house team can handle this type of operation.

The executive noted that for the relationship to work, both parties must be willing to measure the progress of the operation and align contracts. Information should also be properly disseminated to ensure that complex contracts are integrated flawlessly to control risks. He added that for the providers to better explain their contributions to the success of a company, they should first be able to analyze and understand their performance and compare it with the initial objectives and agreement of the operation.

Going Mobile: Create an App or Develop a Mobile-Friendly Website?

by: Finella Kristle Panlilio

Tuesday, January 28, 2014 | Comments (0)

Category: Outsourcing Research / Trends

One of the things your business should have to gain leverage in today's market is mobile presence. Customers today are always on the move and they are opening mobile applications when they use their phones, tablets, and other mobile devices. By opening these mobile apps, customers are granted easy access to the information they need.

Now that your customers are using their mobile devices to connect with businesses, it is important to make a good impression and be properly set up to meet their needs. And as mobile apps help small and large businesses get and retain customers, business owners have to decide on the type of approach they should delve into for their mobile presence.

Which type of approach should you delve into for your business' mobile presence?

BusinessNewsDaily lists five steps to take when choosing which way to go.

1. Does your product use a phone feature such as accelerometer, GPS, contacts or push notifications? If not, then a mobile app isn't necessary.
2. If your business is decided on taking advantage of the phone's capabilities, then consider your audience when designing a mobile app. You may need to choose just one platform, such as iOS or Android. Before doing so, conduct a market research about which devices your customers and target customers typically own.
3. If you think that your business does not need the phone's features, at least design a responsive site - a type of Web design that adjusts how it looks based on the device on which it is accessed. Most sites have a big mobile audience so you will not regret investing in a Web experience that is responsive.
4. When designing a responsive site, focus on what is most important and forget the rest. Be prepared for the site to appear uncoordinated in some devices. Again, it will help to do your research to find out which devices customers usually use to access your site.
5. Have a group of experts design the responsive site or app. Remember that mobile devices are about your big thumbs and big buttons, and thumbs do not have the same level of accuracy as a mouse. Avoid features like big company logos to rid your mobile-friendly site of clutter.

Factors contributing to the rising healthcare BPO market

Several factors are seen to contribute to the rapidly rising global healthcare business process outsourcing (BPO) market.

The recently released report "Healthcare BPO Market [Payer (Claims Processing, HR Services, Finance & Accounts), Provider (Medical Billing & Coding), Pharmaceutical (Clinical Trial, Contract Manufacturing, & Non-Clinical Services)] - Trends & Forecasts (2013 - 2018)" covers the key drivers, challenges, and opportunities are for the sector from 2013 to 2018.

For 2013, the market was predicted to be valued at approximately $92,325.90 million. With a 10.8 percent CAGR for the duration of 2013 to 2018, it is predicted to be valued at $188,856.50 million by 2018.

Healthcare organizations are looking for ways to be more cost-effective which is why claims processing, medical billing, and contract research activities are increasing in the market. Moreover, it was found that if payer, provider, and pharmaceutical companies outsource other processes like HR, sales and marketing, and finance and accounts, they will be able to focus more on the core functions of the business. In 2013, 80 percent of the Healthcare BPO Market was accounted for by the pharmaceutical outsourcing segment, but with the regulatory updates in the US and Europe, outsourcing activity in the payer and provider segments are expected to evolve and increase as well.     

The Healthcare BPO Market is divided into clients and providers. The key clients included in the report come from US, Europe, and Rest of the World. The provider destinations are the Philippines, India, China, the US, Europe, LATAM, the Middle East, and Rest of the World. The US posts the largest market share due to its healthcare reforms.


What You Need to Learn from First-Time Entrepreneurs

by: Finella Kristle Panlilio

Friday, January 24, 2014 | Comments (0)

Category: Outsourcing Research / Trends

Philippine Real Estate Industry Grew 18%

Mistakes are not uncommon among entrepreneurs, old-timers, and first-timers alike. The only difference is that it is the first-time entrepreneurs who make the most mistakes - and naturally - because building a company from scratch is not exactly a walk in the park.
Small businesses have a failure rate of 50- 70% within the first 18 months. To help you learn from those who have been in the thick of it, Business Insider has come up with a list of the most common mistakes first-time entrepreneurs make, and some helpful pieces of advice to boot.
1. Picking the wrong co-founder.
One of the big responsibilities as you start a new business is choosing a partner. This decision will make an impact on your business in terms of equity and satisfaction, so it is always best to choose someone you can work with and who will be able to complement your skills.
2. Not understanding the skills needed to be CEO.
Being a CEO requires particular sets of skills - one for starting a company, and another for growing it. As a founder, you need to be firm, articulate, and capable of carrying out decisions and have passion and a clear vision. Furthermore, you need to understand every single process and protocol, from human resource policies to international partnerships.
3. Trying to make a product for everyone.
When you try to please everybody, you end up wasting a lot of time and energy trying to figure out what people want. Invest your time in your product or service, focus on making it specific and not like everything else out there.
4. Obsessing over the competition.
If you spend too much time obsessing over your competition, your product or service will eventually become its copycat version.
5. Not learning every side of the business.
The best entrepreneurs are the ones who understand that in addition to being good leaders, they also need to understand the tech, sales, product, and marketing areas of their company.
6. Running out of cash.
Most first-time entrepreneurs fail to realize that money is constantly going out the door, and without sales or financing, you will eventually run out of cash and be forced to cease operations. What you need to do is to guard your money by creating budgets, keeping receipts, and tracking expenses. You'll be in a more favorable condition when you know where your money is going. First focus spending on customer acquisition, hiring, and employee productivity.
7. Getting too emotionally attached.
Don't get too emotionally attached to an idea especially if there are signs of it not working. Getting emotionally attached to an idea makes you lose objectivity.
8. Not hiring the right fit.
Of course, you will want to hire talent from big companies, but this does not mean that these hires know how to manage by influence. Most big company managers are used to managing by hierarchy, which kills the early stage, highly collaborative culture, and therefore leads to rapid and iterative decision making.
9. Not getting feedback from your customers.
Establish a good and lasting relationship with your customers by turning to them for validation. Without a satisfied customer, your company wouldn't exist, or survive.

Benefits of Outsourcing HR & Payroll Processes

Small business owners often overlook HR and payroll processes as they are usually preoccupied with how they can generate sales to get their money back. On average, small business owners spend 7-25 percent of their working hours for employee paperwork. One of the known solutions that could help free up their valuable time is outsourcing.

A post at RealBusiness.co.uk lists the key advantages that HR and payroll outsourcing has to offer.   

It will help increase productivity.

Apart from freeing up time, outsourcing helps operations increase productivity as the money saved through it can be allotted for commissions and incentives for the employees. Satisfied and happy employees are found to perform better, and this could lead to better outcomes.

You will be compliant with industry standards.
HR and payroll outsourcing providers are known to strictly follow rules and regulations of the industry. One of which is proper calculation of tax according to the HMRC’s code of practice. In fact, the complexities and rapid changes in HMRC rulings have fuelled HR and payroll outsourcing activities for administrative processes.  

For businesses that keep HR and payroll processes in-house, they would need to allot time and budget for training to guarantee that all the employees are well informed, and to reduce future risks.

You will get significant cost savings.

Additional staff for HR and payroll processes could mean additional work stations and overhead costs. However, business owners are still reluctant to outsource because they think they will lose control of the operation, but providers have matured over the years and the ones with proven track record will assist you in assigning a point person who will oversee that operation for you.

IT Outsourcing Predictions for 2014

by: Sarah Joson

Tuesday, January 21, 2014 | Comments (0)

Category: Outsourcing Research / Trends

2014 IT Outsourcing Forecast

A lot of things had happened in the global IT outsourcing industry in the past year. This 2014, CIO.com released a compilation of forecasts they have gathered by interviewing outsourcing observers and experts.

1. This will be the year for artificial intelligence.
For the manufacturing and logistics segment, Shawn C. Helms, a partner at K&L Gates, said more and more firms will adopt robot-like technologies which are predicted to automate man-powered processes this year. He also noted that robots will soon move up the value chain over time. Jonathan Crane, IPsoft’s chief commercial officer, on the other hand, questioned the longevity of this trend should it persist. He noted that this could be a cause for the downfall of labor arbitrage all over the world.

Another industry expert stated that this could be a solution to the rising labor costs as CIOs are looking for alternative ways to reduce and manage operating costs without having to automate everything and rule out manual processes.

2. Rise of hybrid sourcing

An executive predicted that in 2014, offshore outsourcing as a business model will lose its lustre as the hybrid model where offshoring and insourcing will be more utilized in operations. However, one factor that is expected to remain in the new model is common management. It is anticipated that companies will find the best combination that will suit the requirements of their business, which includes finding the best talent for the job and cost efficiency for IT services.

3. Insourcing will also become more popular.
Stan Lepeak, global research director at KPMG, said 20 to 30 percent of the outsourced IT processes will be brought back in-house as more organizations feel the need to have more operational control on the services. IT services management frameworks are also on the rise which is expected to fuel the movement of outsourced process back in-house.

4. Service integration will be insourced as well.
After the experimentation period where clients transferred multi-sourcing management capabilities to providers, it is projected that service integration will be absorbed back home. It was found that most outsourced models fail to deliver positive results and are often causes of additional challenges for executives such as loss of control and visibility in their outsourced operations.

5. Doubt in the cloud
Cloud frameworks are anticipated to become more detailed as clients want to manage IT services more effectively, especially now that they are waiting for clearer reports on how their investments are put to use. They will be doing this until they have gathered enough data to use as benchmark. Meanwhile, service providers will be adjusting to the changes in the demands of the market.

6. Collaboration is key in multisourced operations.
Since most organizations that use multisourcing created "cooperation agreements" for their providers in 2013, it will be more utilized in 2014 as more and more firms are adopting the multi-sourced business model.

7. Pricing models for IT deals will be less constricting.
Financial commitments will be more flexible this year as IT outsourcing customers are starting to mature and have gained knowledge on how to make deals according to their company’s preferences. Providers will start to offer services and products at a lower price range and packages such as annuity subscriptions to retain clients without imposing long-term commitments.

8. India to take over infrastructure deals
India is expected to gain traction in infrastructure deals as experts expect them to shift from application development and business process outsourcing to a destination for infrastructure development.

9. Deals will be scaled up or downsized.
Large outsourcing deals are expected to be broken down into smaller, multi-sourced ones and small deals are expected to be augmented to midsize as clients want to expand operations with their current providers.
10. Control will be the core of each operation.
Organizations will make sure that control and management will be the core of their outsourced operations. This is in line with their need to manage performance and risks now that global business services are becoming more complex and diverse. However, clients will face hiring challenges because of a shortage in the talent pool for managers.

16 Processes that can be Outsourced

by: Sarah Joson

Friday, January 17, 2014 | Comments (0)

Category: Outsourcing Research / Trends

16 Commonly Outsourced Processes

Nowadays, businesses are expected to be more flexible when it comes to adapting to the technological trends in the industry and demand from the market.

Organizations are looking for ways to reinvent themselves to remain relevant and to stay competitive given that new players are taking the center stage in their respective industries.

A post at BRW.com.au shares 16 processes that businesses are seen outsourcing to get ahead of their competition.

1. Deployment of samples and leaflets
Distribution of leaflets in high-traffic areas is still one of the best ways to get people’s attention. Anything in this type of campaign can be outsourced from the design of the handout itself to the people who will give out the flyers.

2. Localized letterbox leaflet distribution
Businesses, especially the small and start-up ones, can organize a letterbox leaflet distribution campaign. They can customize the theme of their campaign according to the interests and culture of their local community.

3. Telemarketing
Phone-based marketing is also one of the renowned processes that can help generate leads and address the concerns of existing clients.

4. Product or website testing
If you are launching a new product or application, you can get information from the market itself through actual trials. Business owners can hire project managers who will facilitate the testing for them while they are busy with their day-to-day activities.

5. Market research and data

Data is one of the pivotal elements of a successful business. It can be used as a basis of a marketing campaign or development of a new product. It can be done online or through the actual market itself.

6. Focus group
Collecting data from a focus group is a combination of research and actual interviews. Operations can be outsourced to experts in the field. Business owners in turn will get credible results based on quantitative data.
7. Plant undercover agents
Market research service providers are also capable of deploying undercover agents who will pose as shoppers so you can ensure that your company is being presented in a good-natured way in public. You will be able to see if the customer service representative is briefed accordingly or if your products are in stock in consigned stores.

8. Manpower for company events
Companies can also lease staff for events such as parties and conferences. The hospitality industry may not be one of the specializations of your business, but if clients enjoy your events, then good karma is on your company’s way.

9. Photographers for the event          
Clearly, not all organizations have a full-time photographer for company events. To properly document the conferences, research, and parties, executives can hire professional photographers who will be able to capture images that can be used for press releases and other marketing materials.
10. Event assistants
Executives need not to put on one hat during important company events. They can hire additional assistants to make sure that things will run smoothly during important occasions.

11. Audio and video experts
Videos are now becoming the easiest way to advertise and improve brand recall among customers. Although sometimes internet speed can be an issue, once a video goes viral, business owners can expect a surge in followers and potential clients.

12. Informative content creation
Content marketing is also an effective way to create awareness amongst your target segment. However, conceptualizing, creating, and publishing content on a regular basis take time, which is why it is more ideal to outsource these processes to content marketing specialists.
13. Email assistants

You can now hire virtual assistants to handle your emails for you. Apart from being able to manage your inbox properly, you will be able to respond to your clients in a timely manner which shows them that they are important to your business and that you value them.

14. Graphic designers
To ensure that your images are following the latest trends, you can outsource graphic design work to service providers who can do the designing and editing for you. It is one of the best ways to save on costs.

15. Promotional models
You can always outsource models to be the face of your company. This way, the chances of you having the same pictures and images for your marketing campaigns will be eliminated.

16. Office admin
Small and start-up business owners often end up with tons of back office work to do such as encoding, filing, and even purchasing materials for the business. Instead, you can hire an office admin or office assistant who can do all those things remotely.

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