An interaction with Ravi Vij, director, quality and WFM/MIS Tech Mahindra, revealed some interesting facts encircling the workforce management outsourcing market. Read on

GS:How has the workforce management process outsourcing evolved?

RV: Workforce Management has become an integral part of not only the BPO industry but also for other industries. Organizations are constantly trying to improve their profit margins and customer experience. This can be achieved by optimizing their manpower utilization and exploring the opportunities of Workforce Management deployment within their organizations. Currently most organizations work on an internal Workforce Management team, but there is an increasing trend of companies moving towards outsourcing Workforce Management activities to specialized vendors who have the proven techniques, skills and ability to bring about the desired improvements. We are increasingly observing a trend where companies are taking the strategic decision to outsource functions of their business that they don’t consider to be a core competency. With so much development and introduction on new technologies in the Workforce Management field, organizations have moved towards the outsourcing of this highly skilled job, relieving them of the burden of purchase of a technology, its maintenance, hiring of qualified and skilled resource, training and development of internal resources, etc.

GS:What are the different models/ methods of implementing being employed?

RV:There are different ways in which workforce management outsourcing is being carried out. There are organizations that have only outsourced particular sub-functions of workforce management like Forecasting or Scheduling or MIS & Analytics or Real Time monitoring. On the other hand some organizations have outsourced end to end workforce management activities. Some organizations still prefer the vendor to work on their already existing Work Force Management tools like IEX, Aspect, Blue Pumpkin, etc.

Some organizations in order to ease themselves from the burden of purchase and maintenance of these software, ask the vendor to work on their own managed tools.

GS:What are the technology and market changes that vendors need to keep in mind?

RV:From a technology perspective there is not much of a change required, as the tools available in this market are pretty consistent like IEX, Avaya, Blue Pumpkin etc. but the vendors are certainly watchful of the market trends within the industry. They need to be aware about their various competitors along with their offerings. Also, they need to periodically evaluate changes in the business dynamics and how those changes can impact their current delivery or be used positively to improve the efficiency that they bring to the table.

GS:What are the upcoming trends?

RV:The current market trends are quite favorable towards Workforce Management Outsourcing. There are top players in the industry who have already entered into this domain and are expanding their business at a good pace. Going forward, we might experience organizations strengthening their Workforce Management capabilities and offer the same as a solution to a different organization. Also there are smaller players who are entering this arena as part of their consulting portfolio.

GS:What are the key drivers?

RV:There are multiple factors which drive an organization to outsource Workforce Management. Primarily, the reasons being lack of core competency in Workforce Management practice, burden to procure a Work Force Management tool, challenges in administering and maintaining the tool etc. Also, with the growth of business and addition in manpower, there will be a need for an additional investment to procure licenses to operate the tool whereas in an outsourced model, the entire burden of investment might rest with the vendor depending on the pricing model agreed between the two parties.

GS:Inhibitors to workforce management process outsourcing adoption from a buyer’s point of view?

RV: There can be various factors which can resist buyers from adoption of Workforce Management process outsourcing. Currently, Workforce Management is considered to be the backbone of an organization and it is not an easy decision to handover such a crucial task/role to a third party. Also, outsourcing Workforce Management practices would also require sharing the employee details/financial / performance metrics/data of an organization which can impact negatively under the current competitive market. Also, since it is a new domain of expertise, there in not much of a proven capability of a vendor available that will boost the morale of the buyer to go for the solution.

GS:What are the challenges vendors faces?

RV:Though, if the acceptance level of Workforce Management outsourcing is high between the buyer (middle management) and vendor and there is a collaborative approach between them to work towards optimal solution, there will not be much of a challenge. But, few things that one might keep in mind while going for it are: buyers need to be flexible to accept the solutions being offered, real time communication of requirement and its fulfillment, effective deployment of solution provided by the vendor.

GS:What are the recommendations for buyers?

RV: Buyers should not be in a hurry to select a vendor and should do a complete market research before finalizing a vendor. One should also feel free to take feedback from the current customers of those vendors if possible. Also, if a vendor does not have proven capabilities in all the different sub-functions of Workforce Management, one should look at the feasibility of outsourcing each sub-function to different vendors depending on their area of proven expertise.

GS:What are the recommendations for service providers?

RV:Service providers should not try to pitch in for the end to end solution, if they lack confidence or does not have a proven expertise in any specific sub-function of Workforce Management. One should only pitch in for the business in which they have high capabilities and proven records. Vendors should also look at understanding the business before they start providing solution to the buyer as it will definitely help them plan their action plan.