BUSINESS INSIGHTS The BPO Market Outlook Changing competitive dynamics, key players and best practices Published August 2006 New Technology Management Report BPO market sizing ($m), 2004-2008 Source: The BPO Market Outlook • Identify lucrative areas of investment • Assess and develop your competitive strategy • Strengthen your market position The BPO Market Outlook Changing competitive dynamics, key players and best practices The three underlying Business Process Outsourcing (BPO) is the fastest growing segment of value propositions of BPO IT outsourcing, as organizations see the opportunity it offers to outsource business processes with the following benefits: the ability to focus on core competencies; cost savings; improved business process quality; flexibility in terms of technology; and reduced time to market. The BPO Market Outlook is a new management report that provides an introduction to horizontal BPO – such as CRM, human resources, finance and accounting, and procurement – profiling the major players, analysing market trends and outlining best practices to provide Source: The BPO Market Outlook organizations with a platform for making the right BPO decisions. “Increasingly competitive environment and pressure to improve operational efficiency in recent years has This new report will enable you to assess the BPO market and forced companies to focus on areas that deliver develop specific competitive strategies to increase efficiency and competitive differentiation. As a result, these productivity whilst reducing costs. companies are looking for opportunities to pass on responsibility for supporting or administrative functions that are not considered strategic to the business...“ Some key findings from this report... Indian BPO revenues and • The market for F&A BPO is set to grow from $13.9 billion in 2005, to headcount, 2004-2006 over $18.5 billion in 2008, at a CAGR of 10%. • BPO can lead to savings of up to 30%, which can increase to 50% if the outsourced work is offshored. • The BPO market is the single fastest growing area of the IT services sector. Growing 8% annually, spending on BPO services is expected to grow from $112.1 billion in 2005 to $144 billion in 2008, an increase of 40%. • F&A BPO is mainly a labor arbitrage play, which means the barriers to Source: The BPO Market Outlook entry are lower and Indian offshore providers have been able to gain a strong foothold in the market. “The Indian BPO market is estimated to have grown from $4.6bn in 2004 to $6.3bn in 2005, recording • The HRO market is predicted to grow from just under $23 billion in a growth of nearly 48 per cent – accounting for 27 per 2004 to over $30 billion in 2008, at a CAGR of 7%. cent of total software and services exports. Net employment in the Indian BPO segment is • Procurement outsourcing (PO) is starting to gain market traction. estimated to have grown by approximately 100,000 in 2005, taking the total direct employment to 316,000. The BPO sector is predicted to • India remains the largest provider of offshore BPO services, grow to more than $6bn in 2006...” accounting for nearly half of the global offshore BPO market. However, China is expected to grow rapidly. This new report will enable you to... • Anticipate future risks by assessing the benefits and risks of Accenture’s customer contact outsourcing business processes, in terms of the type of process that value proposition should be outsourced, the capabilities of service providers and location of service provision analysed in this report. • Develop successful competitive strategies, penetrate the market and increase market share using our best practice advice and recommendations for companies considering BPO and the forecast for market growth in each BPO sector. • Make informed decisions by recognizing the market dynamics shaping the BPO market, and how that affects your BPO Source: The BPO Market Outlook strategies through an analysis of the market trends, drivers and inhibitors that are influencing the BPO market and its horizontal “Accenture ensures that the change happens by sub-sectors. managing relations with outsource providers on behalf of the client. Accenture operates as the prime • Create a competitive advantage by understanding the vendor contractor on behalf of its clients in many instances, competitive dynamics in each horizontal BPO function using the which means the outsource providers sign their competitive analysis and profiles of the main vendors within this contracts for delivery of services with Accenture report. rather than with the client. ....” Key questions answered in this report • Which are the fastest growing BPO sub-sectors, and why ? Top 10 fastest growing IT services providers, 2005 • Should outsourcing be based on financial or strategic considerations? Rank Company Annual Revenue revenue ($m) growth (%) 1 Atos Origin 6,851.0 75.0 • What are the real risks surrounding finance and accounting BPO? 2 Cognizant Tech Solns 587.0 59.0 3 Infosys Technologies 1,592.0 49.8 4 Satyam Computer Svcs 794.0 40.3 5 CGI Group 2,640.0 40.0 • Which business processes should be outsourced? 6 Wipro Technologies 1,388.0 39.6 7 Tata Consultancy Svcs 2,220.0 37.0 8 SRA International 616.0 36.9 9 CACI 1,146.0 35.9 • How mature is each BPO sub-sector? 10 WM-data MB 1,121.0 24.9 • When choosing a BPO provider, what are the most important factors Source: The BPO Market Outlook to consider ? • Which location to choose for offshore BPO? “With BPO representing the single fastest growing area of the IT services sector, IT service providers, management consultancies, and specialist BPO vendors • What type of BPO contract is most suited to your organization? are all positioning themselves to gain a share of this lucrative market. The market itself is seeing a • Why is recruitment outsourcing making waves in the BPO industry? convergence of traditional IT services and specialist business process management services....” • Which are the most established service providers in each BPO sub-sector? Sample information from the report Chapter 7: Best practice BPO BPO benefits Market maturity model for BPO Outsourcing business processes can bring significant benefits to companies looking to cut costs and improve overall business performance. Because external providers focus on key processes as their core competency, companies are able to effectively leverage their knowledge and experience for their own benefit. The core benefits can be categorized into four separate areas: • Lower costs. Because BPO providers focus purely on the processes that they provide, they are able to offer a lower cost to organizations than they might otherwise be able to get themselves. For many of the processes outsourced such as contact centers, Source: The BPO Market Outlook the startup costs are significant, and or many are hard to justify given the alternative of a BPO service. Similarly, the BPO provider will often guarantee that it is using the most appropriate and up-to-date technology, allowing the user to avoid issues such as sourcing and upgrading. • Improve service. Because outsourcing contracts are constructed using SLAs (Service Level Agreements), a predefined level of service is guaranteed. In most situations, this level is higher than the company itself could provide internally. For applications such as customer interaction, this is critical as poor communication with customers can affect revenues. For other processes such as HR, the customer is able to receive better staff and ensure that existing staff are managed properly, thereby leading to better internal efficiencies. • Gain access to expert skills. As companies are faced with increasing regulation, the demand for appropriately skilled staff is growing. Often, it is difficult to ensure an adequate level of knowledge within internal staff to guarantee performance. Using a BPO provider for select processes, however, provides companies with staff that are experts in specific areas. This extra knowledge can help to relieve the pressure of issues such as regulation. Similarly, external experts can help optimize and streamline internal processes through the application of best practices methodology. • Focus on core activities. By outsourcing non-critical elements of the business, companies are able to pay more attention to their core competencies. In this way, companies can effectively forget about managing lines of business such as HR or finance and accounting. This releases considerable resources to try and gain as much market share and revenues as possible, while at the same time maintaining or improving the level of services within the business. BPO market segments Horizontal BPO services are, overall, further advanced in terms of market development than the more sector- specific vertical BPO services. However, a great deal of this development has happened in a service bureau or managed service set-up, often being more third-party service than outsourcing, with few strategic BPO deals having driven past market growth... Order this report today to find out more... Table of Contents EXECUTIVE SUMMARY - Agilsys • An introduction to business process outsourcing - Atos Worldline • Customer relationship management BPO (CRM BPO) - beCogent • Finance and accounting BPO (FAO) - Capita Group • Human resources BPO (HRO) - Convergys • Procurement BPO (PO) - EDS • Offshore BPO - IBM Global Services • BPO best practice - ICICI OneSource - Minacs Worldwide CHAPTER 1: AN INTRODUCTION TO BUSINESS - Perot Systems PROCESS OUTSOURCING - Xansa • Summary • Recommendations • Purpose of this report • Introduction to outsourcing CHAPTER 3: FINANCE AND ACCOUNTING BPO • Business process outsourcing • Summary - Benefits • Introduction - Risks • Market overview • Introduction to horizontal BPO - Market sizing - Customer relationship management (CRM) BPO - Major contracts - Human resources BPO (HRO) • Competitive analysis - Finance and accounting BPO (FAO) - Accenture - Procurement BPO (PO) - Affiliated Computer Services - Offshore BPO - Agilisys • Market dynamics - Capgemini • Market sizing - CGI Group • BPO market conclusions - Convergys - EDS CHAPTER 2: CUSTOMER RELATIONSHIP - Genpact MANAGEMENT BPO - HP Services • Summary - IBM GS • Introduction to CRM BPO - Infosys - Drivers - Tier Technologies - Inhibitors - Vertex • Market dynamics - Unisys - Market background - WNS Global Services - Market sizing - Xansa - Major contracts • Recommendations and FAO best practice • Competitive dynamics - Vendor selection (minimizing risk) - Accenture - Affiliated Computer Services (ACS) Table of Contents (contd.) CHAPTER 4: HUMAN RESOURCES BPO • Market dynamics • Summary • Competitive analysis • Introduction to HRO - Accenture • Market overview - Ariba - Hot topics - IBM GS — Capacity and pricing - ICG Commerce — Rise of multi-service deals, and offshore delivery • Recommendations and PO best practice — Mid-market moves — M&A not as expected CHAPTER 6: OFFSHORE BPO — Rise of recruitment BPO (RPO) • Summary - Market dynamics • Introduction Offshore BPO - Market sizing • Market context - Major contracts - Indian services providers • Competitive dynamics • Competitive analysis - Accenture HR Services - Accenture - Affiliated Computer Services (ACS) - Cognizant Technology Solutions - ADP (Employer Services) - EDS (Mphasis) - Capita Group - Genpact - Capgemini - HCL Technologies - Ceridian Corp - ICICI One Source - Convergys - IBM (Daksh) - EDS (ExcellerateHRO) - Infosys Technologies - Fujitsu Services - Tata Consultancy Services - Hewitt Associates - Transworks Information Services - HP Services - Wipro Technologies - IBM GS - WNS Global Services - SAP - Xansa - Other • Recommendations and offshore BPO best practice • Recommendations and HRO best practice - Vendor selection - Change management — Pick the Country First - When is HRO right for the organization? — Recommendation - Overcoming reluctance to outsource — Domain & Technical Filtering - Preparation and execution CHAPTER 5: PROCUREMENT BPO — Engagement issues • Summary • Introduction to Procurement BPO - Benefits Table of Contents (contd.) CHAPTER 7: BEST PRACTICE BPO • Largest BPO contracts in last 12 months • Summary (to 30 June 2006) • Introduction • BPO market sizing ($m), 2004-2008 • The three basic value propositions of BPO • Customer care BPO market sizing ($m), 2004-2008 - Cost reduction • Major CRM BPO contracts in last 12 months - Core competency (to 30 June 2006) - Transformation • Finance & accounting BPO market sizing ($m), • Key business and technological issues in BPO 2004-2008 - Transformation: who, how and when? • Major FAO contracts in the last 12 months — How does application infrastructure need to (to 30 June 2006) evolve to enable BPO? • Major contracts in the development of HRO, 1999-2005 - The vertical credibility challenge • HRO market sizing ($m), 2004-2008 • The BPO maturity model • Major HRO contracts, 2005-2006 (to 30 June 2006) - Pre-BPO • Key contracts in procurement BPO - Lift-out stage • Top 10 services providers by profit margin, 2005 - Shared services stage - Utility stage • BPO contracts • BPO benefits • BPO market segments • Glossary • Index FIGURES • BPO market sizing ($m), 2004-2008 • Accenture’s customer contact value proposition • Finance and accounting outsourcing • Procurement outsourcing • Indian BPO revenues and headcount, 2004-2006 • Horizontal BPO in India in 2005 • Accenture global delivery network, 2005 • The three underlying value propositions of BPO • Market maturity model for BPO TABLES • Top 10 fastest growing IT services providers, 2005 • Top 10 services providers by profit margin, 2005 FAX BACK TO +44 20 7675 7533 Website 1. * Please refer to our website www.globalbusinessinsights.com for up-to-date prices I would like to order the following report(s): Please enter the title of the report(s) below* Please circle your currency __________________________________________________________________________________________ Price (£/€/$)____________________ __________________________________________________________________________________________ Price (£/€/$)____________________ __________________________________________________________________________________________ Price (£/€/$)____________________ __________________________________________________________________________________________ Price (£/€/$)____________________ __________________________________________________________________________________________ Price (£/€/$)____________________ __________________________________________________________________________________________ Price (£/€/$)____________________ 2. Complete your details: MAKE YOUR REPORT INTERACTIVE Title: Mr/Mrs/Ms Powerful search tools - find the exact report sections you need with ease. Visual functions - find your content by browsing through the structure of reports. Name Translate your report - into major European and Asian languages. Create presentations - advanced tools to collate and organize content. Job Title Innovative new analysis tools - to extract the content you need. Create your own report - build a report based on the search criteria that you set. Department All the above features for £50/€75/$95, just tick the box on the left. Company Address 3. Complete payment details: City State/Province Please indicate your preferred currency option: UK£ Euros US$ Yen¥ Country Post Code/ZIP I enclose a check payable to Business Insights Ltd for __________________+ p+p £50/€75/$95 Please invoice my company for _______________________ + p+p £50/€75/$95 Email Please debit my credit/charge card Tel Amex Visa Mastercard Fax Card No ______________________________________________________________________________ Sign below to confirm your order: Expiry Date _________ / _________ Cardholder Signature ________________________________ Cardholder address___________________________________________________________________ Please supply purchase order number here if required by your accounts department: PLEASE NOTE: ORDERS WITHOUT A I do not require a purchase order number SIGNATURE CANNOT BE PROCESSED. I require a purchase order number, here is the number_________________________ For paper copy/ies please tick box and add £50/€75/$95 per report EU companies (except UK) must supply: VAT / BTW / MOMS / MWST / IVA / FPA number: For interactive facility please tick box and add £50/€75/$95 per report ___________________________________________________________________________________________ 4. Send us your order: Fax your completed order form back to us on +44 20 7675 7533 By completing this form you agree that the data in the form will be used for the Business Insights, Charles House, 108-110 Finchley Road, London, NW3 5JJ, UK purpose of processing your order. We may also use your data to keep you informed of Business Insights’ products and services. As an international organization, Business Insights may need to process your data internationally, including in countries which do not have data protection laws, or which have standards lower than the +44 20 7675 0990 European Union. Business Insights, however, seeks to protect your personal data. You have a right to see and correct your data by writing to us. Sometimes a fee is payable. For queries about this contact email@example.com. +44 20 7675 7533 Please tick the relevant box(es) if you would not like Business Insights to contact you by: Fax Phone Email Post e firstname.lastname@example.org Occasionally, our client list is made available to other companies for carefully selected correspondence. Please check here if you do not wish to receive such correspondence by: Email Post www.globalbusinessinsights.com This order is subject to our standard terms and conditions, a copy of which is available on request.
Pages to are hidden for
"BUSINESS INSIGHTS The BPO Market Outlook Changing competitive dynamics"Please download to view full document