2014 Global SRM Research Report - Customer of choice

ARTICLE

STATE OF FLUX

2014 GLOBAL SRM RESEARCH REPORT

192

WHAT CAN SRM do for 21 ST CENTURY BPO

Today Business Process Outsourcing (BPO) is an acceptedmanagement practice acrossmost industry sectors. It's used to reduce the cost of back office processes bymoving themto lowcost countries.

ARTICLE BY

Mel Shutes, Executive Consultant and Head of SRM at State of Flux. Call Mel on +44 (0)2078 420 600 or email him at mel.shutes@stateofflux.co.uk for more information on applying SRM to BPO.

Outsourcing has been seen as a solution for what might be described as 'non-core' activities, or described by some as 'bad cost'. However as the sector has matured, there is a new generation of clients who are demanding more from their BPO partners. Increasingly, clients are expecting outcomes beyond just cost savings and meeting service level agreements. The new generation of BPO client want their service partners to transform their back office, improve performance, be far more responsive to changing business needs and deliver business outcomes, that a few years ago would not have been expected. The more transparent and collaborative approach that SRM advocates has a lot to contribute in this environment. Business analysts expect continued growth in the traditional 'back office' BPO areas such as finance and accounting, human resources, and customer services. However, as more companies

adopt these tried-and-tested BPO services, there will be increased demand for newer, more innovative and transformational BPO services in middle and front office environments. These have a more direct impact on revenues, customer service and profitability. Along with these new aspirations and opportunities comes risk, especially with respect to services such as mortgage processing, healthcare administration, patient care administration and insurance claims administration. However, by selecting partners with more than just basic business processing capability and by working more collaboratively, it will be possible to not only manage risk but also deliver better business outcomes. SRM by its very nature is a discipline of working collaboratively with those suppliers that are vital to the success of the organisation Therefore, it would certainly include relationships with BPO