As a global leader on China Outsourcing and Market, Devott released its annual forecasts of Top 10 Trends in China Outsourcing via its international informational portal www.chnsourcing.com on December 25, 2012. Based on extensive data from its customers around country and globe, Devott studied the mechanism of the vertical transformation and undisclosed the drivers of the trends along with industry standards and own methodologies. Devott predicts that under the native influence of the shrinking global markets and sluggish recovery in major economic powers, national protectionism as demonstrated in US Presidential Election, China-Japan Island Conflict, reducing growth rate in China, there are numerous challenges and adversities China Outsourcing will face in 2013.

Prediction 1: The market size of onshore and offshore will be contracted slightly; Competitions over prices will be intensified.

It’s a bumpy road to recover the global economy. The unemployment rate keeps going up and the international offshore market will further shrink. As to Chinese outsourcing service enterprises, the European and American market will shrink dramatically with the re-emergence of trade protectionism and insourcing restart. To Japanese market, due to the declining Japanese economy as well as disgusting impact from political factor that the dispute on Diaoyu Island between China and Japan ,Japanese outsourcing market is getting fewer opportunities for China in 2013. Under high expectations, Chinese domestic market is still waiting for breakout because of without enough driving force from the State-owned enterprises and government agencies although domestic market increases fast. The overall recession of the onshore and offshore market directly results in more fierce market competition. Meanwhile, the majority of the companies are on the low end of the industrial chain that resulting from Chinese outsourcing industry’s remaining on primary stage, the price war is going to be intensifying in 2013 both for offshore and onshore market.

Prediction 2: Overseas investment from China based sourcing corporations will get more consensus; More Chinese companies will plan and implement their global strategies onshore in developed countries.

More and more work is called for being shifted back to local caused by American president election, which has become a big feature in the second industrial transfer for global service outsourcing. As the worldwide largest outsourcer, the United States leads the “outsourcing backflow“ trend which will drive the global outsourcing enterprises to reformulate the strategy of development and market. To set up branches and delivery centers locally in the U.S. will become one of the core trends for Chinese outsourcing industry in 2013. Many countries’ outsourcing enterprise will launch fierce rival in the U.S., especially the competition between China and India.

Prediction 3: Growth Drivers of China Outsourcing will be transformed rapidly, depending more on capital and market instead of incentives and low cost talent.

Through the rapid growth of the industry size, the development of the whole Chinese outsourcing industry is evolving from the basic embryonic stage to the upgrade stage, during which every factor coordinates and interacts with each other to establish an ecosystem for service outsourcing. Chinese outsourcing industry’s growth pattern is onto a turning point. “Market + capital” model is going to replace “policy + talents” to facilitate the future industry, so as to lead the industry’s transformation and upgrading.

Forecast 4: M&A activities will be increased considerably; so are hidden risks and negative impact of the Investments.

Under the shrinking domestic market and intensifying competition, as well as being driven by some industry giants such as Pactera, Achievo and The Devott Fund, the trend of investment and acquisition within outsourcing industry will further be continued in 2013. The trend of industrial integration will be intensified. However, due to the great risks of M&A, all kinds’ of problems gradually appeared in the process of M&A at the later stage. Consequently, the number of failing cases will be on an increase accordingly.

Prediction 5: Focus of the growth will be more on innovation than cost reduction.

Due to incapable of affording the innovation and transition for some enterprises after economic crisis such as market survey, trial operation, and risk and opportunity costs, they crave for outsourcing enterprises with professional abilities and practical experience as their intellectual strategic partners to help them improve efficiency and transform their businesses. Therefore, the value of outsourcing service is predicted to shift from cost reduction and core competence enhancement to innovation support to reshape their core competence. Meanwhile, the status of the outsourcing enterprises will be improved as well.

Prediction 6: “Big” is no longer growth objective. Fast deployment, flexible practices and vertical solutions are 2013 Performance Indexes in corporate board rooms.

In 2013, the global service outsourcing buyers will become more cautious on outsourcing strategy decision making and service providers’ choosing. Resources resolutions become very popular in this industry. With the development of the global buyers’ demand, the development of China’s outsourcing service providers will change their direction to “flexible structure, rapid iteration and fast reaction”. Global buyers pay more attention to enterprise solutions and service capacity and request the enterprise develop professionally.

Prediction 7: New Delivery Models and Business Processes Developed by “Cloud Platform” will penetrate deeper of enterprise markets.

Starting from 2013, cloud outsourcing based on the “cloud” platform and “cloud” model increasingly become the mainstream and trend in the development of outsourcing industry. With the core element – CCES (Cloud Computing Enabled Service) model, could sourcing drives the whole industry to achieve the transformation and upgrading and extend to 3.0 eras. The whole industry will be endowed with new connotation. At the same time, crowdsourcing as a new mode will get more and more respected and application by global buyers.

Predictions 8: New Outsourcing Models and Process Management Methodologies will appear widely in Big Data Era.

As data becomes a new hub to promote industrial development and the core element, a new service outsourcing segmentation field appear and rapid development – that is, great data outsourcing. As a new field of KPO, great data outsourcing based on data mining will be got full development in 2013. A large number of great data outsourcing enterprises will appear and gather abundance data outsourcing solutions. At the same time, the development of great data outsourcing will give rise to a new business model and accelerate technological progress.

Prediction 9: The weight of BPO in outsourcing industry will be increased. It’s expected the first public company in BPO vertical emerges in 2013.

In 2013, China’s BPO industry will develop rapidly from the document entry, data processing and other low-end level BPOs to high-end level BPOs which related to the core businesses. At present there is no one real BPO enterprise in 29 local service outsourcing listed companies. Until 2013, the situation will be broken and the industry will appear “competitive advantage gets sustainable” situation, the leaders will enjoy extra income.

Prediction 10: Supports and incentive policies and regulations remain key driving forces to China Outsourcing’s transformation and innovation

In 2013, the public platform construction funds and services tax and other services outsourcing policy are expected to extend. The whole service outsourcing industry will get a further development by personal training of service outsourcing, developing the international market, intellectual property protection and other aspects. At the same time, the state will take new measures on the new features appeared in the development of service outsourcing industry such as support large enterprises mergers and acquisitions and increase the management training subsidy of service outsourcing enterprises.

According to the problems China service outsourcing industry may face in 2013, “Forecasts and Suggestions of Service Outsourcing for China 2013” gives ten core development suggestions from the government and enterprise aspects. For more detailed information and download, please visit: http://www.chnsourcing.com.cn/top/tenforecast/2013/

By Deepti Krishnan, Analyst, ValueNotes Sourcing Practice.

Australia is an emerging destination for Legal Process Outsourcing (LPO) providers looking to expand their client base in new geographies. The Australian legal industry is estimated to be worth USD 21 billion and the majority of the business of this growing market for legal services comes from corporations in Australia.

The results of 2012 Australian Corporate Counsel Survey by Deloitte revealed that 96% of in-house legal teams outsourced at least some legal tasks to organizations within Australia, while 27% also outsourced work offshore. The work outsourced includes litigation, mergers and acquisitions, industrial relations and contract management. While the numbers remain small, there is an emerging trend of work also being outsourced to LPOs.

For these in-house counsels, the ability to outsource basic but time consuming legal work has resulted in invaluable savings, allowing them to focus on more complex and sensitive tasks. In turn, they have placed pressure on law firms to reduce their bills through LPOs. As General Counsels (GCs) become more open to embracing LPOs, providers are actively marketing to them, offering lower cost solutions in areas such as contract management, drafting services, and legal research.

There are a few existing LPO providers in Australia. Pangea3 was the first Indian-based LPO to enter the Australian legal services market in2010 after signing a partnership agreement with the law firm, Advent Lawyers. It was followed by Integreon in 2011, when it entered into an agreement with Mallesons Stephen Jaques. Corrs Chambers Westgarth, a big Australian law firm, appointed Integreon and Exigent to its LPO Panel in early 2012, highlighting the increasing comfort of law firms with the idea of LPO.

As the adoption of LPO is slowly but surely on the uptake, the New South Wales office of Legal Services Commission published Draft Guidelines on practice issues for lawyers regarding legal process outsourcing. These guidelines make it clear that lawyers, whether in-house or external, can use LPOs to assist them in delivering legal services to their clients. The draft guideline covers the following areas:

• Confidentiality: A legal practitioner should maintain their fiduciary obligations to their client by ensuring their LPO partner is competent and capable of performing the work required while ensuring the confidentiality of client information.
• Client Consent: A legal practitioner must obtain consent from their client before disclosing the client’s confidential information to a third party LPO provider.
• Conflict Management: A legal practitioner must ensure that their LPO partner is not engaging in any work which conflicts with their client’s interest.
• Supervision: Legal practitioners who use LPOs are responsible for supervising the legal services provided to the client and are ultimately liable for the product of the provider.

Thus, the lawyers, as buyers of LPO, are ultimately responsible for the delivery of the legal services to the client. Though Australian lawyers have quality concerns, LPO providers have a great opportunity to tap this market. They need to take effective measures to overcome the concerns of existing and potential buyers, and implement a strategy to adhere to the expected guidelines. For this, LPO providers will need to invest in an onshore team to assuage the concerns of lawyers, and also invest in training programs, stringent quality controls, and a rigid data security system.

By Matt Ford

Telemarketing in Australia has been found to be one of the toughest jobs for businesses residing in the land down under. For one thing, their Do-Not-Call Registry has got to be one of the most populated lists of certain individuals that do not want to be called upon by telemarketers. Still, this does not stop businesses from trying to locate new business opportunities within the continent.

A lot of Australian business owners know that outsourcing in Australian lead generation companies provide tons of benefits for their respective firms. Such benefits include:

•         Reduction of overall costs for the firm and for the lead generation campaign
•         Better client services for lesser the cost
•         Expansion of market; from across the continent and even overseas
•         Reliable workforce
•         Access to a very attractive English accent
•         Reduction of at-home training expenses

These are but a few of the many benefits once a business organization is able to outsource their lead generation campaign in Australian lead generation companies. Let us look at each of these benefits in turn to gain a better understanding of them.

            Reduction of overall costs for the firm and for the lead generation campaign

Telemarketing in Australia for lead generation campaigns is already known to be a tough nut to crack. Additionally, building at-home telemarketing teams may become very costly especially to newer businesses. Outsourcing in lead generation companies within the land down under provides substantial cost reduction for the entire firm as well as the lead generation campaign.

            Better client services for lesser the cost

Leaning towards the first benefit, outsourcing does indeed lower down overall costs but it also allows firms to gain access to a high level of mastery for their lead generation campaign. This allows the firm to provide better services towards their Australian clients at only a handful of the entire cost.

            Expansion of market; from across the continent and even overseas

Every business needs to expand their market sooner or later to provide growth for their firm; Australian business organizations are no exception to this rule. Outsourcing in these companies that provide lead generation services within the land down under provides a great expansion of one’s target market within the Australian continent and even outside the Australian territory.

            Reliable workforce

Australian telemarketers are world-renowned for their high reliability when it comes to lead generation. They can assure their clients with quality results as they can get highly qualified leads from the lead generation campaign. Hence, they provide the highest probabilities of growth and financial success for an Australian company.

            Access to a very attractive English accent

Australian’s are very well-known for their very attractive accent. Even at the start of the call, most prospects would be wowed with the kind of accent that they have. As such, telemarketers are can easily build the foundation of trust between them and their client’s prospects making the acquisition of business transactions a lot less difficult to achieve.

            Reduction of at-home training expenses

Even if an Australian company has their own at-home telemarketing team for lead generation services, training costs are sure to sky rocket. Therefore, outsourcing in Australian companies that provide telemarketing lead generation services lessens down the overall training cost for the at-home team. The reason is because the lead generation company can handle the training for their own team of telemarketers.

Once an Australian company is able to outsource their lead generation services in an Australian telemarketing firm, they would have the highest chances of attaining growth and success by reaping these benefits.

Source: Business2Community

By Cara Waters

AS ANZ Bank announced job cuts in Australia it was hosting open days in Manila to attract workers to take over many of the positions.

The five-day recruitment open house, in addition to more than 70 mid-level banking jobs advertised on its Philippines website, reveals that ANZ is heavily engaged in moving Australian jobs overseas.

The jobs range from analysts and ”collections associates” (debt collectors) to a health and wellbeing consultant.

The advertisement for the open house, which finished yesterday, says collections associates will call ANZ customers in Australia and will need to work Australian business hours.

Candidates for the roles are required to have excellent English, two years of college education and at least a year’s experience in the “business process outsourcing industry” – preferably in collections or finance.

Applicants will “need to understand and adapt to cultural differences to ensure great customer experience is maintained”, according to the advertisement.

ANZ has announced cuts of 1000 jobs to its Australian workforce, 492 roles initially and 508 in the pipeline.

“Obviously there would be a difference between what someone in a back-office role gets paid in Australia and what they would be paid for the same role in Manila,” said ANZ spokesman Stephen Ries.

Mr. Ries defended ANZ’s overseas recruitment drive when it is cutting jobs in Australia.

“We are a regional bank, we have a substantial presence in Asia so it makes sense that we advertise overseas,” he said.

“The majority of the roles cut are being made redundant so they are not being replaced but a small number of roles are going to our regional hubs.

“We have had a hub in Bangalore for over 20 years and we also have one in Manila.”

Mr. Ries said the “small number” of roles going offshore amounted to 100 of the 492 initial job cuts announced.

Read more: http://www.smh.com.au/national/anz-recruiting-in-philippines-as-local-jobs-axed-20120218-1tg3l.html#ixzz1mo5n9kGi

By Martin Conboy, President – Australian BPO Association (ABPOA)

Australia will have most of the big engineering infrastructure projects in the global oil and gas industry during the next ten years. This represents up to 75 per cent of all projects, and that is really going to stretch our capacity to attract the volume of people required.

Media reports suggest that there is a shortage of over 20,000 professional engineers, and that number will only grow as a result of the rampant demand from the Australian mining and resources boom.

Engineering companies in the oil and gas, mining, consultancy and infrastructure are the firms that most need to attract and retain skilled workers.

Even the fact that Australia’s universities are producing more mining engineering graduates each year, it is still only half of what the industry needs. First year salaries are $100,000 plus allowances and the employment rate is 100 per cent.

Because of the labour shortage, some mining companies are increasing automation and are having the processes monitored from other locations. It should not be long before some clever outsourcing companies spot this opportunity.

A whole new outsourcing market has sprung up with recruitment companies actively targeting skilled migrants in the UK, Ireland, South Africa and India, and some engineering companies are outsourcing or offshoring project management, design and fabrication projects to New Zealand in order to connect with skilled labour.

In a classic case of BPO 1.0, New Zealand has a good supply of engineering skills and lower labour costs amplified by the strong Australian dollar and flexible work packages. Apart from addressing the work that needs to be done, it also translates into 30 per cent savings on labour.

As a mechanism to fill the recruitment pipeline, savvy recruitment companies are using Philippine-based resume harvesters to target potential recruits efficiently and cost effectively.

Engineering companies moving to this type of back office delivery model and implementing proven, effective processes via progressive forward thinking, recruitment companies can expect business benefits beyond cost reduction. Recruitment-related business process outsourcing could help recruitment performance, lower operating costs, and increase the size of the available pool of talent.

With ultra competitive strategies required to identify talent quickly, using skilled and inexpensive Asian-based resume harvesters is an eloquent solution. This model can also help create competitive advantage for engineering companies by predicting and fulfilling labour force needs and aligning talent plans.

Not only can this reduce recruitment lead times and costs, but it can also ensure a broader reach and consistent service experience regardless of geography, as it provides a process outline for candidate identification and recruitment administration, which can then be used across all geographies.

By Andrew Tsanadis

Paragem Dealer Services has reported growth in the uptake of their risk management, compliance support and practice management systems, with two current clients increasing the services they use.

With 20 small dealers currently using Paragem’s customised practice management system (Model Office), Affinity Wealth Services has engaged the company to improve its back office capabilities, Paragem stated.

Paragem managing director Ian Knox said Model Office provided planning practices with the process improvements which lowered compliance and back office costs.

The growing demand for Paragem’s services reflected planners’ desire to streamline their businesses, while the current climate of legislative reform also made it an ideal time to restructure software, Knox said.

Affinity managing partner Keith Jones said the partnership with Paragem complemented Affinity’s independent and professional advice offering.

“We wanted to make sure our strong advice and investment service offering was supported by reliable operational systems, and it was important that those systems enabled us to focus on the part of the business that is most important, providing advice and managing risk for clients,” Jones said.

Carnbrea & Co Limited have also turned to Paragem to assist with its risk management and compliance needs, particularly in regards to governance and process improvement.

“We’re looking forward to growing our business with the support of Paragem and the experience it brings dealing with complex and compliant advice models,” said Carnbrea chief executive officer Robert Lyon.

Outsourcing part of the compliance programme but linking it to internal requirements has enabled Carnbrea to access independent, high quality support and establish the necessary level of governance it demands, Knox said.

Source: Money Management