By Martin Conboy
BPO has matured, evolving from industrialisation and process efficiency, to a focus on analytics, on demand service platforms and innovation. This creates a significant opportunity for organisations to ‘leap frog’ earlier generations of BPO and drive business outcomes previously not associated with outsourcing. This schism in the BPO journey sits in the space between BPO 3.0 and BPO 4.0 and it is all about greater functionality and process excellence delivered by the latest generation of BPO, including accelerated speed to market, enhanced innovation, stronger customer loyalty, savvier talent management and top-line growth.
Against a background where physical products are commoditising, customer service is seen to be a crucial differentiator of the service offering. It is essential that the service delivered supports the product promise. In the future, it is only those organisations that provide outstanding service that will thrive, since it will allow them to differentiate their products, charge a price premium and maintain their competitive edge in the marketplace.
In the evolution of the BPO journey the reader will recall from previous readings in the Sauce that BPO 1.0 describes the first step on the BPO journey, commonly known as Labour Arbitrage. The next stage is BPO 2.0, which addresses process reengineering and using technology and point solutions to improve processes and squeeze out value and efficiencies. BPO 3.0 starts to incorporate new channels like the cloud and social media. Needless to say BPO 3.0 starts to see a dramatic leap forward in data accumulation inside the enterprise. BPO 4.0 is all about big data and how one can make sense of it and not get overwhelmed by the voluminous amount of data that are generated by all of the information flowing through the new channels.
In parallel the growth of digital content continues unabated. The Internal Data Corporation (IDC) predicts that the digital universe, a measure of content, will have grown by a factor of 300 from 2005 to 2020. And Google’s own statistics show that its total number of indexed pages was one trillion in 2008 and is expected to reach 30 trillion in 2013. The average number of daily searches on Google, another measure of digital demand, has grown by a factor of four from 2007 to 2011, according to comScore.
Marketers have contributed significantly to this content growth. Based on a 2012 survey by Content Wise, marketers increased their total spending on content development by 45% from 2005 to 2012, when the percentage of marketers’ budgets allocated to content creation increased from 31% to 39%.
I caught up with Russell Ives Accenture Australia BPO Lead and he described how this hot new frontier is being constructed around the customer experience and using data analytics and building algorithms and crunching facts and numbers to look for opportunities to improve business outcomes.
Big data is the new business black. It’s a catchall phrase for the billions of transactions and other bits of information about their customers, suppliers and operations logged by businesses every day. Yesterday’s data storage problem has become today’s strategic asset.
The large-scale gathering of data from a variety of sources and the application of sophisticated analytical tools to make sense of that data is quickly becoming the new frontier for organisations seeking competitive differentiation. The BPO and outsourcing industry is playing a pivotal role in developing the processes that overcome many of the challenges associated with data analytics.
Organisations in a variety of industries, ranging from finance to retailing to telecommunications, have started to engage in big data strategies. The reasons for engaging analytical methodologies being deployed is driven by the need to leverage data from a variety of sources and channels to achieve an accurate and universal view of the business in real time. Pulling levers is all very well, but pull the wrong one without knowing all the facts and it can lead to disastrous outcomes. After all we don’t know what we don’t know.
Russell Ives states, “Many companies struggle to achieve visibility around the customer experience when interacting with an enterprise across all channels. We are seeing an increased demand for the use of analytic tools inside the outsourced process that are required to deliver improved outcomes for end clients.”
Mr. Ives argues that there has been a shift from the standard suite of business metrics built into service provider service level agreements to more of a focus on business outcomes “We are being challenged by our clients to collaborate more as a strategic provider to understand how data analytics can identify in what manner end customers want to interact. We can now construct service metrics built around the real customer outcomes the client is seeking to achieve; channel, sales, service, satisfaction.”
Enterprises are generating large amounts of transactional data about their customers from their internal systems and this is growing at an exponential rate. ‘Big data’ is becoming a key basis of competition, underpinning new waves of productivity, growth, innovation, consumer services and competitive advantage. ‘Big data’ offers a range of opportunities for organisations, but there are also some significant challenges.
According to research from McKinsey Global Institute, organisations and their management teams, in every sector, will need to grapple with the implications of big data. Those who ignore it will be left behind.
Through various online activities, most consumers leave an easy-to-follow trail of digital footprints that reveal who they are, what they buy, where they go, and much more. Organisations want this information to be able to gain competitive advantage and be able to offer the most appropriate offer at the most appropriate time. Organisations not only need to put the right talent and technology in place but also the structure, workflows and incentives to optimise the use of big data
“To achieve and sustain superior outcomes on behalf of their clients, as custodians of their client’s brands, providers need to change their frame of reference from supplier to a broader more holistic perspective that encompasses on continuous improvement and focuses on benefits above and beyond cost reduction,” said Mr Ives.
Mr Ives explained that at a practical level, organisations must shift away from simple SLA metrics like average handling time (AHT) to outcome metrics that might include metrics such as sales delivered by a channel. He also noted that organisations in Australia, except for the very large ones, are in the early stages of developing sufficient expertise and knowledge to develop and make sense of data analytics and lack appropriate processes to leverage data from a range of sources.












