Earlier buyers approach revolved primarily around cost cutting without due consideration on the long term perspective. Or there were wholesome transformation approach where it would take 2-3 years to start seeing some benefits. Ranjan thinks neither of these has really provided the right set of value. Most of the organizations as we move forward are going to look for balance set of outcome.
Neil Bentley, founder and managing director, Active Operations Management India(AOMi)feels headcount is expected to come under pressure as a large part (over 70 percent) of controllable cost in BPOs is associated with staffing. However, in cases where deals have already been struck there may be zero incentives to reduce head count; in transaction-based deals the scenario may be different.
“Companies seeking to make budgetary cuts may well turn to BPO as an option - maybe even some operations that have never previously considered the option such as parts of the public sector. This may lead to some growth in BPO but with it would come competition and pressure on price and service delivery. The successful BPOs would therefore be the ones that stand out as being able to offer the most competitive package - price plus assurance of delivery,” added Bentley.
Sitel is seeing a significant cost-savings opportunity for global call center BPO providers to achieve optimal operational efficiency by transitioning from on-premise legacy systems to cloud-based call center offerings that scale as a direct operating expense. This will also open the door for companies to replace large, captive operations with faster and cheaper outsourced operations, particularly in areas where customer experience can be enhanced by specialists.
Andrew Kokes, vice president, global product management,Sitel articulated, "Technological, social and economic changes have made at-home agents a viable business model, especially for experienced outsourcing providers. With broadband access now available in much of the US, end users can supplement existing call center operations by drawing from and connecting to a new and substantial labor pool. In 2012, Sitel believes the BPO industry will see a decrease in traditional call center environments where agents work in a typical office setting. Instead, work-at-home agents will emerge as a customer-care solution that favors a more flexible labor environment."
Highlights from Everest's Report titled 2012 Market Predictions
• Restoring growth while improving profitability and reducing operational complexity will be the primary imperatives for banks, leading to investments in legacy modernization, application consolidation and ERP initiatives. In addition, adapting to changing customer preferences will create demand in areas such as mobility, social media, and channel integration.
• Within banking BPO, increase pressure on margins and profitability, and the rising cost of servicing each loan, is causing lenders to seek out solutions that can help them standardize loan origination and convert fixed to variable costs; this will drive greater adoption of technology-enabled BPO solutions within the leading segment.
• Pricing pressure will squeeze providers' margins, especially offshore, forcing investment in newer customer-centric solutions and innovative engagement models.
• Captive investments will continue, and the majority of setups/expansions will be in Asia Pacific and CEE.
Investments will take place in building more robust analytics and integrated talent management offerings.
The final word is BPO spends could increase as they have low impact on business and help organizations save cost. Satya Gottumukkala, executive vice president, Anthelio Business Technologies Pvt. Ltd. voiced, “I see more of shared services being outsourced – in fact the vendors will look for newer opportunities to save costs of their customers. This will be a “win-win” situation for both the customers and the vendors.”
Lalit Dhingra, president of NIIT Technologies expressed, “Hardware and technology refresh is perceived to be optimized. With the spread of cloud computing, progressive enterprises will use shared or dedicated computing power on cloud at a fraction of cost. Traditional vendors who used to lease computing equipment and power in the old data center hosting del will see a shift in consumer behavior.”