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BPO and BPM

Blog: Business Process Management - JC Reddy

Business Process Outsourcing (BPO) is a current major trend. Many functions including HR administration, customer support / call centers, sales and marketing, finance and accounting, legal services, medical transcriptioning, and such are finding their way to cheaper places.

IT is obviously the enabler of BPO, hence the name ITES (IT Enabled Services). I am wondering how the IT systems will evolve and what the issues will be in supporting BPO. If a company is going to outsource business processes to multiple service providers, it has a need to stitch together all those cross-boundary processes as seamlessly as possible.

There are a lot of similarities between manufacturing outsourcing (product supply chains) and business process outsourcing (service supply chains). However, there are some key differences – services are less tangible than products, hence require closer oversight. There are no inventory buffers in service supply chains, so it is harder to handle uncertainties. Back-office systems such as HR systems were never the points of integration with partners, now that becomes essential with back-office operations going BPO. All these factors should influence the nature of IT systems for BPO, and I am interested in reader’s thoughts.

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