Dell anand
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The document discusses how cost will be the primary driver of outsourcing decisions given economic conditions. It recommends that BPO providers focus on operational excellence and productivity to reduce costs sustainably rather than factors like location or size. Additionally, the document advises aligning vendor objectives with customer profitability through value sharing agreements rather than transaction-based pricing and driving end-to-end process innovation to differentiate in commoditized spaces. Finally, it states that most horizontal services are already commoditized, requiring a best cost position, and that standardization can help penetrate vertical specific services faster.
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Dell anand
- 1. Capitalizing on the Expanding BPO Landscape Imperatives for Growth Ganesh S. Lakshminarayanan
- 2. Dell in India 7 Years Knowledge Services 12x Analytics Process Engineering Procurement, HR, Finance. Vertical Specific – R&D Center Voice - Sales Back Office – AR, Collections, OP Software Development Voice - Tech Support - Customer Service DELL CONFIDENTIAL Help Desk for corporate customers
- 3. Cost is Critical Be paranoid about Cost
- 4. Cost is King Cost will drive sourcing decisions more than ever given the economic conditions in the US market. For captives, operational excellence and lower cost of delivery will be more important in these conditions. Investing in the front-line tenure and improving productivity are the only sustainable cost differentiators – size, location, ownership etc are irrelevant.
- 5. Align our Success to the Profitability of our Customers
- 6. Aligning Objectives For captives, having more people in our sites may not necessary mean growth in profitability. Vendors should pro-actively drive restructuring of contracts to move from transaction based pricing to sharing value realization. Driving end-to-end process innovation (e.g. LEAN) will help us differentiate in commoditized “horizontals”.
- 8. Effect of Commoditization Most “Horizontal” services are already commoditized. To be in this space, being in best cost position is required for survival. Differentiation should be focused on improving the profitability of our customers. Standardization of “vertical specific” services will help us penetrate faster.
Editor's Notes
- Good afternoon. We have heard what the opportunity is there for growth and it is exciting. At Dell we have been growing in the last six years and not without pain. So, what I would like to shared today is our learnings from our growth on what are the imperatives to capitalize on this growth. Just to set the context, our operations in India is spread across four sites outside of our manufacturing operations in Chennai. We started six years ago with one site and focusing mainly on voice based tech support. Today our services range from tech support, customer service, sales – all functions which are essentially front office for us, back-office processing (collections, account receivable, order processing, credit card processing), procurement services, software development. We also have vertical specific services : product design, software design, and testing. We have a Global development center. We also have a reasonably large analytics group which focuses on market analytics, website research, supply chain analytics etc. With the growth has its own challenges. If Dell was the opportunity space, we have tried to penetrate both the horizontal services and vertical space. We have grown in terms of headcount close to 12 times in 6 years.
- Imperative number one : cost is critical. There is some euphoria that we are gaining on competency. Buyers are
- Don’t focus too much on headcount cost. Tenure is critical. We pay more for tenure but it will pay off. What are some areas to focus on : Spans/Layers, Non-production cost/heads, Utilization (right level). Platinum club.
- Txn based pricing is old story. We need to help us reduce
- Tech support example : end to end process change – avoiding contacts Paying per minute to paying per effective minute net of defects – reducing time per resolution. Lean principles applied in care.
- Analytics example : Doing it in one region and expanding to others as a service offering.