Cognizant and Business Process Outsourcing
Business Process OutsourcingA Management Process arising out of the
pressure in a ‘boundary less’ global economyIt helps in saving costs, providing flexibility
and improving operational performanceNo longer a short term tool but a long term
competitive advantageThe market can be broadly classified into-
Business administrationSupply Chain ManagementSales, Marketing and Customer Care
BPO Functional Operations
BPO in IndiaAmex and GE pioneered outsourcing in India
in 1990s
Major advantages – Cost and Labour
Growth of the industry has been more concentrated in the major cities
Large BPOs are now focusing on a ‘verticalized’ approach
BPO in IndiaThe growth of BPO in India can be classified
into four phases-
Company owned units pioneered BPO in India
Venture funded new companies
Leading IT services companies enter BPO
Domain/Industry Specialized BPO
Future OutlookDomestic segment to grow by 17% to reach
Rs. 149bn
Exports to increase at 12% to reach USD 16bn
Data analytics is growing fastest at 19%
Direct employment in the industry to cross 6 lakhs growing at 7%
INFOSYS: Augmented outsourcingAugmented outsourcing presents the opportunity
to outsource adjacent processes of the value chain.
This augmentation could be upstream or downstream as desired and beneficial by both parties.
Effects:Impact on the cost of revenue sideHelps client to co-create innovationProvides a pool of business experts who are have
cross-functional analytical expertise.
BENEFITS
- Skill and capacity augmentation
- Analytical and judgmental
improvements-Real world outcomes
and solutions rather than modular solutions
-Support s adjacent processes rather than a
niche process-Develops new links to
support the current structure
- Learning curve comes into picture.
-As the same provider works on the processes, it
can improve upon the process.
Example: Sales supportThe provider has been contracted for:
Sales support of the value chain. Support for market research and telemarketing
Augmented outsourcing benefits: Improvements in channel partner assessment.
TCS: Business-Process-as-a-ServiceThis process uses private cloud to host
application needed by the client.
Useful for small and medium businesses.
Optimum cost solutions supported by best-in-class technology are the key to success of this model.
BenefitsUse of a variable pay-as-you-use pricing
model that helps to maintain minimum capital expenditure.
Services available for both industry specific functions and cross industry specific functions
Customized technology environments creating efficiencies
Standardized business processes with state-of-the-art applications and technology
CTS and Business Process Outsourcing:A horizontal group spreading across all the
verticals.USP Factors:
• Customer satisfaction• Operational productivity• Strategic value• Transformation
"higher-end" servicesBPO, IT Infrastructure Services & business
consulting contributed to 15% of revenue in 2012
Business Delivery Model:Two-in-a-box
• Customer relationships Manager• India-based managers - oversee offshore
delivery ServicesThree-in-a-box
• Adding a business consulting layer to its "two-in-a-box" model
Organized into several verticals and horizontal units
Redefining Business Process Outsourcing:
BPO as a simple cost playInfuses key business activities with technology
levers• Better skills and industry knowledge• New technology and re-engineered processes• Knowledge-intensive and industry-specific
processes• Increasing process effectiveness and
efficiency.
CASE: CTS Client and Solutions in BPOCognizant was engaged by a Fortune 500
pharmaceutical client to provide end-to-end clinical data management services, for all its global R&D sites.
The execution of this complex transition involved:
350+ FTEs ramped up in less than 6 months;7 R&D sites in 4 countries;Re-badging of client employees onshore;
CASE: CTS Client and Solutions in BPOTransition to two offshore locations (Mumbai
andChennai) and one nearshore location
(Budapest);Diverse set of processes, and more than 50
global applications, centralized in a single Data Management Center (DMC)
High customer satisfaction scores from a survey, carried out during transition.
CASE: CTS Client and Solutions in BPO
Future ChallengesNew technologies which are driving new ways of
organizing and operating More collaboration More flexible business processes and technology
infrastructure Ability to make (and dissolve) spontaneous connections with
customers and suppliers
Megatrends pushing companies from traditional business models (enterprise 1.0) to the next-generation enterprise global asset-light virtual in its operations skilled at leveraging flexible technologies
Future TrendsThe businesses will need to overcome multiple challenges,
Securing dataNurturing an adaptive cultureDeveloping strong change management program to
sustain momentum
Cognizant offers various products and services to cater to the needs of business partners and help them in the process of:Reinventing the business model to be more collaborative
and less hierarchicalRethinking which activities are core to their competitive
edge versus which would be better handled by a third-party with deeper and more scalable expertise
Rewiring the technology architecture to be more virtual, agile, and Web 2.0-based
Services @ Future Future of Work Business Assessment Model:
To help businesses reach its full potential
Benchmarking and Metrics Analysis: Cognizant’s Index for Future Readiness is utilized to help change the way client work. This index is a unique repository of client and non-client survey data from top executives at approximately 200 leading enterprises and spanning 125 metrics.
Shortfall of existing business modelIncreasingly complex projects Reason for failure of complex projects
Poor Understanding of clients requirementChanging requirements during the project
development phase due to complex nature of the project
Decision making process of the client is not known to the provider
Cognizant 2.0Focus on “intellectual arbitrage” rather that
“labour arbitrage”It is the ability to bring all the expertise a global
services firm has around the world to bear on a client’s critical business requirements
Cognizant 2.0 is a Web 2.0-based platform that enables Cognizant associates (and eventually business partners and clients) worldwide to collaborate virtually and deliver significant time-to-market, cost and IT transformational value to clients
Component of Cognizant 2.0
A high-powered knowledge management system
A standardized project and workflow management system
21st-century tools to help solve their clients' 21st-century challenges
THANK YOU