Today’s outsourcers and shared services operations are expected to deliver not just cost savings, but also innovation, agility, quality and growth. At the same time the bar has been raised when it comes to expectations with customers having lower tolerance for mistakes, delays or poor service. In fact, Gartner rates customer experience at the top of CEOs’ priorities for 2017. It is the ability for organisations to respond and adapt quickly to both customer requests and changing market circumstances that can provide that key point of differentiation.
Outsourcing has come a long way. I can remember publishing my first book in 2004 and still needing to explain the benefits to sceptical executives. This is not so common now that outsourcing has become an accepted part of boardroom strategy. Today, it’s more unusual to see that a company rejects outsourcing.
Once more, the validity of outsourcing in the public sector has been brought into question.
Just this week, the National Audit Office released a report on the UK government’s programme to transfer back-office functions to two shared services centres. The report outlines that although savings were made, so far to date, it has not achieved value for money.
In this article I examine the question of whether an in-house or outsourced approach is best when transforming business support services such as HR, procurement, customer care, etc. So for example an organisation might ask itself: “Should we establish a robotic process automation (RPA) regime in our accounting operation or should we get a business process outsourcing (BPO) provider to run our accounting for us, which would include the deployment of its RPA regime?” I am aware that this question is a very old chestnut.