Knowledge Center Article

Getting Innovation From Offshore BPO Companies In The Philippines

By Art Williams / 30 August 2010

One of the biggest disappointments corporations face after adopting business process outsourcing as a transformation strategy is the lack of true process innovation and excellence introduced over the course of the agreement.

Although it is frequently invoked during the pursuit and solution development of agreements, it is rarely executed upon. Therefore, it should not be surprising that the most critical issue surrounding customer dissatisfaction is the lack of innovation introduced by offshore BPO companies in the Philippines.

How can buyers be dissatisfied when call centers typically meet, and often exceed, service level commitments?

Unfortunately, there is a confluence of factors that make the lack of innovation the norm, not the exception. It is called stability at all costs. It is systemic to the industry and is the preferred service delivery model, and it must certainly change.

If it doesn’t, customers will begin to bring processes back in-house not because of poor performance by call centers overseas, but due to lack of innovation and process excellence demonstrated over the life of the agreement.

The selection process for offshore BPO companies in the Philippines is much more formal and agnostic than most industry professionals give it credit. Factors, criteria, weighting formulas, and automated scoring tools are frequently used to eliminate bias and reduce pre-existing preferred relationships.

Innovation is Essential

At the end of these evaluations, the top three criteria in PITON engagements are almost always:

1) confidence in achieving the desired future state;
2) good working relations fit with the local delivery team; and
3) ability to achieve cost savings and predict additional costs.

Ironically, as soon as the agreement is signed and the relationship is formalized, the top two criteria are thrust aside. Instead, a focus on cost savings, stability at all costs, and noise reduction is undertaken.

However, innovation and transformation always creates noise. Once the agreement is signed, the avoidance of noise, even in the pursuit of innovation, is routinely suppressed by a majority of offshore BPO companies in the Philippines. But this need not be so. Noise leads to actions that support stability instead of pushing for needed transformation and innovation.

All the momentum for achieving the future state should not be diminished, and achieving the promised cost savings can be paramount even though that was not the primary objective of the offshoring relationship in the first place.

Governance and relationship management staff pushing for innovation and creating noise in the process stand to gain something for the client and all relevant ideas ought to be heard out.

Communications that focus on transformation, motivation, and truth makes for a very good working relation between clients and local providers. The theme of stability is reinforced.

Stability means the business case is realized, margins are met, and the customer is satisfied. Compensation formulas are geared toward ensuring all key performance indicators are a go, but innovation and process excellence make it difficult for all indicators to be so.

However, management processes, organizational systems, and reporting processes are all designed to promote stability, and not much innovation. A good working relation and open lines of communication between the client and the offshore BPO company in the Philippines will set the stage for customized innovation for the benefit of both parties.

Additional factors include: the skills composition of client relationship management, the offshore governance teams, and the capacity of the offshore companies. Almost every examinable factor should promote stability and innovation.

Big marquee accounts usually ask for innovation. Those who listen, and know how to handle risks alongside the implementation of innovations, will have profitable accounts and happy clients who will renew their agreements. One thing is certain: buyers will get innovation with the cooperation of the companies they hire overseas.

To learn more about our industry-specific BPO capabilities please contact us by calling +1-310-844-7805 or by filling out our inquiry form. We look forward to hearing from you.

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John Maczynski


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AU: 1800-370-551
UK: 808-178-0977

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Success in outsourcing isn't a matter of chance, but rather the result of a meticulously defined process, a formula that Fortune 500 companies have diligently honed over time. This rigor is a significant factor in the rarity of failures within these industry titans' outsourced programs.

Having spent over two decades partnering with and delivering Business Process Outsourcing (BPO) solutions to Fortune 500 clients, John possesses an in-depth understanding of this intricate process. His comprehensive approach incorporates an exhaustive assessment of outsourcing requirements, precise vendor sourcing, and a robust program management strategy.

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