Bpo The Life Raft

Confidential © 2009 WNS Global Services | wns.com

Business Process Outsourcing:

A life raft for businesses striving to stay afloat

2Confidential © 2009 WNS Global Services | wns.com

Nowhere To Hide…

Today’s economic crisis is creating untold challenges for businesses in all industries and in all corners of the world


…And The Life Rafts Are Few

During severe economic dislocations, businesses almost always turn to rapidly trimming staff

While pink slips and restructuring can provide immediate cost reduction, someone still has to do the work – paying the bills, dealing with customers, preparing reports, ensuring accounts are reconciled


Laying Off Workforce Results In Demoralized Staff And Dip In Productivity

In the layoff process, companies often throw talent overboard along with the layers of suddenly “unnecessary” bureaucracy

Employees left behind are often so demoralized that productivity dips dramatically

Smart companies keep the implications of their short term actions within a long term context.

According to a study by Leadership

IQ, 74% of employees who kept their

job amidst a corporate layoff say their

own productivity has declined since

the layoff. And 69% say the quality of

their company’s product or service

has declined since the layoffs.


There Is An Alternative…Business Process Outsourcing

There is an alternative to large scale, aggressive across-the-board layoffs, one that enables businesses to rapidly lower costs and set the stage for future growth and expansions

Business process outsourcing can prove to be a life raft for survival and a platform to thrive after the storm is over

If implemented properly, BPO can be a fast and simple tool to help a company survive a downturn and then to thrive when the economic climate calms down


Why Business Process Outsourcing?

Delivers a rapid decrease in cost structure

– If properly executed, companies can decrease cost structure in as rapidly as two to three quarters

– The cost savings through business process outsourcing may approximate 30 to 60 percent from the current cost base

Changes fixed cost to variable

– Cost management can be tightened by aligning expenditure to business volumes

Retains the focus on the customer

– Diminished employee headcounts (courtesy the layoffs) demand customer facing or support staff to double (or even triple) duty, resulting in drop in customer service

– BPO focused on improving customer care not only maintains customer loyalty through good service but can also be shaped to build revenues, in some cases increasing share of customer wallet by as much as 50 percent



Puts focus on knowledge and away from intuition

– Aids decision making by providing rich insights about the who the customer is, what and when he will buy, how much production will cost, and how to better manage a supply chain among other business aspects

Makes the cost structure transparent

– Helps understand actual costs to deliver business processes thus delivering vital intelligence for a CFO or business manager

Can be engineered for quick return

– Ability to align economics of the contract to respond to specific financial needs

– For example – BPO contracts can front load savings, incorporate the cost of technology, or defer the cost of transition, virtually acting as a financing tool



Gets even more out of shared services costs

– Can quickly take cost savings and performance to the next level

– Moving processes offshore provides further cost reduction and helps shared services management generate bandwidth and capacity to move the next set of business processes into the shared service center


Leveraging BPO Now… Eyes On The Prize

To get maximum impact – reducing cost at speed – CXOs should be able to answer “Yes” to the majority of these questions

Does it significantly and rapidly decrease my cost structure?– If BPO does not lead to significant (25 percent or more) and rapid (within three quarters) cost reduction,

it most likely does not make sense.

Does BPO maintain or enhance my customer's experience?– If processes are customer facing, BPO can keep relentless focus on that all important stakeholder,

the customer, by keeping service levels consistent or improving them altogether.

Can BPO make my fixed costs variable?– BPO must change the game by moving at least some component of fixed costs quickly to a unit

transaction pricing structure, or introduce a level of variable pricing which adapts to business volumes.

Will I know more about my business?– BPO should add transparency into performance management, providing more information about

revenues, customers and operations.

Does BPO quickly create a tangible and measurable business impact?– BPO is not just about cost reduction – if receivables can be collected more quickly, or customers

buy more products and services, the business impact can be of more value than a reduction in the cost base.


Eight Simple Rules To Get Started On Your BPO Journey

1. Ensure BPO is a CEO priority

2. Approach outsourcing with an open mind to determine “the art of the possible”

3. Keep it simple as this is not the time to radically “transform” business processes

4. Move fast as there is no change without urgency

5. Empower an internal outsourcing czar, and put top talent on the case

6. Develop a realistic deployment plan

7. Insist on alignment with an outsourcing service provider that will work the way you to – rather than impose its ways of working

8. Debit budgets in advance ensures that managers have no excuse but to be committed


After The Storm

Support for rapid global market entry

Standardized business processes

Rationalized delivery model

Commercialized approach to operations

What are some of the advantages companies gain by moving to a BPO model today


To learn more, please visit http://bpotheliferaft.wns.com or write to us at [email protected]