Business Process Outsourcing
Business Process Outsourcing

Business Process Outsourcing

Available Only on StudyHippo
  • Pages: 9 (4473 words)
  • Published: November 27, 2018
Text preview

Business process outsourcing is a component of outsourcing, which involves contracting operations of a given business functions or processes to a third party service provider (Tas & Sunder, 2004). It describes the outsourcing of a business processing service to an outside firm with the aim of replacing in-house services and labor from an outside firm or firms. Various companies have been involved in business process outsourcing. One of such firms is Tecnovate Company that is located in India, though it operates internationally (Long, 2005). A successful closure of outsourcing deals is the first step in effective management in the transitioning of services from an in-house team to a selected outsourcing service provider. Most managers tune-off when an outsourcing deal is struck, especially, to the detriment of that process. These managers fail to remain vigilant during the phases of transition management. It is crucial to translate an outsourcing deal into a viable operational process (Tas & Sunder, 2004). Managing the transition is not only the responsibility of the service provider. Managers need to understand that the transition is a joint effort which requires a lot of commitment and involvement of both the service provider and the client’s organization. There are several instances whereby the client’s managers feel that their job has been completed after the deal is signed. The reason they give is that the onus shifts entirely to the service provider once the deal is struck. However, the key impetus in effecting smooth transitions hinges to a certain extent on the competence and experience of the servi

...

ce provider. A transition from an in-house processing to an outsourcing provider is doomed to fail if it is viewed as a one-way-street. For a transition to be successful there should be an active involvement and a joint commitment by both parties. Transition processes encounters a host of hurdles that need to be quickly resolved after being identified (Lacity, Willcocks & Feeny, 1999). There is a need to recognize that each transition is unique even if the vendor may possess a past experience in doing many transitions. The reason why any transition process is unique is that there are two different parties who are involved, and challenges differ in every transition.

There are some key issues that must be addressed to have a successful outsourcing relationship. One of the issues is having the right team in place. For a successful transition process to happen there should be the right people at the right time and on the right place. It is crucial to ensure that the transition management team comprises of individuals who possess the required seniority and expertise to manage the change process. Also, when the right team is in place, besides having the technical expertise, it helps if the team members possess a prior international experience together with direct customers’ interactive experience. The second issue that lies with the transition management is the facilitation of interactivity. The transition management team should not make the transition process to be a one-way-street, whereby the incumbent team is left alone to share knowledge (Tas & Sunder, 2004). They should encourage the new incoming team t

View entire sample
Join StudyHippo to see entire essay
View entire sample
Join StudyHippo to see entire essay

share their learning experiences or knowledge at regular intervals so as to gauge the effectiveness of the learning process. Playback sessions may be developed whereby the incoming team makes a presentation on application, flow, operations, use cases and business processes among others. In such way, the management can establish a clear relationship in the transition process.

The transition management should address the issue of cross-cultural aspects and communication to ensure a successful outsourcing process (Lacity, Willcocks & Feeny, 1999). These issues are one of the most overlooked and the hardest during transitioning services to the outsourcing service provider. These issues give rise to communication challenges and breed mistrust in the entire engagement. The management should arrange a cross-cultural training for customer teams and vendor. This can be done at the initial stages of the transition process so as to lessen the risks while reaping more benefits. The transition management should perform reviews diligently. Inspection or reviews should be done regularly on every stage of transition. This will ensure that there is clear and prompt communication during the process. Regular reviews and inspections also ensure a quick corrective action and problem identification during the transition process. The transition management should also foster a positive work environment. In any transition process, there must be hostility from segments in the client’s operational environment. Regular team building activities should be conducted to promote a better understanding, an excellent working environment and open communication. Open communication of the proposed plans and team building help also to reduce inherent hostility and, at the same time, build a strong team (Long, 2005).

Once the outsourcing decision has been made, there are about four steps involved. The first step involves scoping. Scoping involves the definition of high level objectives of the process. Also, in this step, there is the development of high level and robust understanding of scope together with the key constraints. The outsourcing management should understand the implication of human resource after outsourcing. The second step involves feasibility study. This step focuses on building on the initial scope and constraints. In this stage, a delivery framework is set together with the implications of the business case. Supporting risk management activities and commercial agenda are set through drawing out key parameters of services delivery. The third step involves preparation of the transition process. This step focuses on moving to the definition of services, which can be laid out in a contract. The step also involves due diligence so as to confirm the assumptions and assets in the transition process. Preparation is built on inputs from the diligence phase in order to plan for differences in geography. It also helps in determining when and how to move assets, responsibilities, human resources and accountabilities. The last step is known as transition, or as process migration (Reuvid et al. 2005). It involves handing over the process to the supplier, who is the third party or the captive unit from the client. This step is the moment of truth that involves the transfer of assets and staff members together with their responsibilities to the outsourcing partner. This step can take a

View entire sample
Join StudyHippo to see entire essay