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The Official Magazine of the International Association of Outsourcing Professionals
GlobalizationToday April 2011
THE PAPER CHASE This year’s IAOP Salary Survey shows outsourcing wages are rising
Also in this issue: Tips for Boosting Your Career “Perfect” Partnerships in the Financial Sector The 2011 Latin American Outsourcing Summit
INSIDE April 2011 7 PUBLISHER’S NOTE 8 NEWS FEED
What’s new and noteworthy in global commerce.
24 COLOMBIA RISING
by Santiago Pinzón Galán
This once economically disadvantaged Latin American country is becoming a highly desirable destination for outsourcing of all kinds.
28 HOW TO BOOST YOUR
OUTSOURCING CAREER by The Editors
Don’t think outsourcing is a sexy career? Think again! Here’s how to get ahead in the profession.
37 “PERFECT” PARTNERSHIPS IN FINANCE?
by Tony Collins
Financial services providers are reaping profitable benefits from outsourcing product development and administration.
39 AEROSPACE OUTSOURCING: THE SKY’S THE LIMIT by John Persinos
Our Editorial Director interviews a seasoned expert in aerospace outsourcing, to determine the best ways to send vital work to out-ofcountry providers.
40 IAOP WORLD CONNECTION 46 SCRAPBOOK
2010: The Year in Pictures
A HARD LOOK AT THE HARD CASH
by The Editors
The 2011 member survey of the International Association of Outsourcing Professionals (IAOP) shows outsourcing 75 jobs and wages rose last year. Here are the details. 95
25 5 0
WE ARE THE ONES WHO HELP
MORE THAN 60 GLOBAL
COMPANIES REDUCE THEIR OPERATING COSTS SUBSTANTIALLY AND
ACHIEVE BUSINESS GROWTH.
WE ARE CAPGEMINI DISCOVER YOUR EXPERTS’ NETWORK
CAPGEMINI BPO – WE ARE THE ONES WHO TRANSFORM YOUR SUPPORT FUNCTIONS TO BOOST YOUR BUSINESS Capgemini’s expertise is recognized in Business Process Outsourcing (BPO) with a solution portfolio that spans Finance & Accounting, Customer Operations Management, Procurement and Supply Chain Management, Assurance Management, Human Resources and Knowledge Process Outsourcing services. As part of Capgemini’s Rightshore® delivery network, BPO professionals provide services
to clients worldwide 24 hours a day, seven days a week, in over 35 languages, from centers located in Australia, Brazil, Canada, Chile, China, Guatemala, India, Manila, Poland, Sweden and the United States. More information is available at www.capgemini.com/BPO
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FOUNDER & PUBLISHER Ali Comelek firstname.lastname@example.org
EDITORIAL and PRODUCTION
Get Listed in Globalization Today’s Buyer’s Guide All Globalization Today subscribers have complete access to our Buyer’s Guides that allow them to quickly find and purchase outsourcing and offshoring related products and services. Globalization Today offers a free basic listing to providers in the following categories: • Information Technology • Internet & Web • Consulting • Business Process • Human Resources • Art & Design • Medical & Billing • Printing & Publishing • Writing & Editing • Engineering & Architecture • Finance • Virtual Assistantship
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EDITORIAL DIRECTOR John Persinos email@example.com AD PRODUCTION MANAGER Donna Eastman firstname.lastname@example.org GRAPHIC DESIGN AND PRODUCTION Webstaze Design Studio www.webstaze.com
EDITORIAL ADVISORY BOARD Dr. Bruce Greenwald Prof. Asset Management and Finance Columbia Business School Dr. Matt Waller Prof. Marketing and Logistics University of Arkansas Dr. John Hindle Sr. Manager - Accenture, Adjunct Prof Vanderbilt University Mike Corbett Chairman - International Association of Outsourcing Professionals Matt Shocklee CEO & President - Global Sourcing Optimization Services Arijit Sengupta CEO of BeyondCore, Inc Chair of the Cloud Computing Chapter of IAOP
Address: 6501 E. Greenway Pkwy., Ste 103-494 Scottsdale, AZ, 85254, USA Phone: 1-602-492-4194
Whether you think of Latin America as an outsourcing destination, as a market for your companyâ€™s services, or as the region you call home, this is a must attend global business gathering.
With the support of:
AIT! DONâ€™T W erican m A n i t a L The 2011 rcing Summit Outsou r
d $375 fo ember an m P O IA r bers. $375 fo non-mem d n a te ia c asso gister. ATAM to re /L rg .o P O A w.I Go to ww
The 2011 Latin American Outsourcing Summit, taking place May 26-27, 2011 in Cartagena, Colombia, is a first-of-its-kind global event bringing the thought leadership and global network of IAOP together with leaders from across the Latin American business community. The result is an exceptional opportunity for customers, providers and advisors to both understand and leverage the explosion of outsourcing across the region.
For information on speaking, sponsoring or attending, visit
More Growth, Mo’ Money
Founder and Publisher
After the worst economic slump since the Great Depression, corporate profits are up, credit is loosening and business growth is improving. It shouldn’t be a surprise, then, that salaries and opportunities are rising in the outsourcing field. Welcome to our “Career Issue”, in which we survey the outsourcing landscape to get a picture of how the profession is faring. And according to the latest data from IAOP and other analysts, we’re faring pretty darned well. This isn’t just wishful thinking on our part — it’s borne out by the empirical data. As our cover story makes clear on page 16, the 2011 member survey of the International Association of Outsourcing Professionals (IAOP) conducted in January shows outsourcing jobs and wages increased last year. We couple our salary survey with advice on developing and managing your career; see page 28. We also round out the issue with a column by our Editorial Director, John Persinos, who writes about new trends in aerospace outsourcing (see page 39). Aerospace is not only a technologically intensive industry but also a strategic one. It’s no surprise that rising nations are pouring more resources into developing their aerospace sectors. As the high-tech art of building and operating aircraft becomes more global, it follows that outsourcing plays an increasingly vital role. On page 40, you’ll find more information about the 2011 IAOP Latin American Summit, scheduled for May 26-27, at the Las Americas Hotel Convention Center, Cartagena, Colombia. The Summit is a first-of-its-kind conference and exhibition bringing the thoughtleadership of IAOP together with top executives and analysts from across the Latin American business community. On page 24, there’s a related article about the rise of Colombia as an outsourcing destination. During the recent brutal economic downturn, regional “hot spots” such as Latin America fared better than most. Now that the economy is on the upswing again, look for this important geographical area to resume its torrid pace of growth. When it comes to outsourcing, Latin America is where you’ll find the action. I hope to see you in Colombia; the Summit promises to be a valuable venue for networking and pinpointing new business opportunities. In this era of the Internet, in which we spend so much time interacting with other human beings in cyberspace, these press-theflesh gatherings are more important than ever.
Founder and Publisher Globalization Today Magazine “Official Publication of IAOP” www.GlobalizationToday.com 1-602-492-4194
WHAT YOU NEED TO KNOW IN THE WORLD OF OUTSOURCING
CAPGEMINI IS SELECTED FOR NEW IT OUTSOURCING CONTRACT AT THE UK FINANCIAL SERVICES AUTHORITY www.sourcingfocus.com
Capgemini Financial Services, a global business unit of the Capgemini Group, has been selected in the competitive bidding to supply IT outsourcing services to the U.K. Financial Services Authority (FSA) in a framework agreement covering applications development and applications maintenance for the four-year period 2011-2014. Under the agreement, Capgemini will work with the FSA on strategic projects involving the IT applications required to support the FSA’s regulatory responsibilities. The framework agreement has been designed to give the FSA value for money and the flexibility to address the regulatory change agenda for the next four years. Capgemini will work in close collaboration with the FSA and its suppliers to help the FSA ensure that its systems remain fully attuned to regulatory reform in the U.K. as well as any changes that are introduced at European Union level. The systems in scope will also support the transition to the new regulatory structure in the run-up to 2013 and beyond. The agreement, known as the Strategic Outsourcing Framework Agreement (SOFA), follows a mandatory competitive bidding process under EU procurement directives. The FSA says that Capgemini was successful because of its in-depth knowledge of financial sector regulation, its collaborative ethos and its cost-effective proposals based on its Rightshore delivery model, with the Capgemini FSA delivery teams located in the U.K. and India.
GlobalizationToday April 2011
Gareth Lewis, Chief Information Officer at the FSA, said: “Capgemini has a longstanding relationship with the FSA and during this time have demonstrated their understanding of the regulatory environment. My team and I look forward to working with them over the next four years.” Capgemini has worked with the FSA since 2006 and has successfully designed and built a number of its core systems including its Mandatory Electronic
Reporting System (MER), which has simplified regulatory reporting for the financial services industry while tightening compliance for the FSA. Andy Lees, Head of Capgemini Financial Services UK, said: “We look forward to working with the FSA during a period of significant change for financial industry regulation in the U.K., as it migrates to the twin peaks model, and to helping them address the challenges and opportunities involved.”
SATYAM AND PWC FINED BY THE US SECURITIES AND EXCHANGE COMMISSION FOR ACCOUNTING FRAUD www.sourcingfocus.com
Satyam Computer Services and its former auditor PricewaterhouseCoopers (PwC) have agreed to pay a combined $17.5 million (£10.7m) in fines in the United States after one of India’s biggest corporate scandals. Satyam, an outsourcing company, will
pay $10 million for falsely reporting more than $1 billion in profits over five years. The company’s chairman Ramalinga Raju admitted to the fraud in 2009. Satyam’s shares were indirectly traded on the New York Stock Exchange (NYSE) as well as in India. The U.S.
Securities and Exchange Commission (SEC) said it had fined the Indian affiliate of PwC $7.5 million, describing it as the largest American penalty against a foreign firm. The SEC said the auditor, PW India, failed to independently verify cash balances in Satyam bank accounts.
WIPRO WANTS TO BUY IT SERVICES BUSINESS FROM U.S.-BASED SAIC www.indianexpress.com
Software firm Wipro Technologies has proposed to acquire U.S.-based Science Applications International Corporation’s (SAIC) oil and gas IT business in an allcash deal of about $150 million. The unit provides consulting, system integration and outsourcing services to global oil majors. “Oil and gas companies are investing in the upstream business, while looking at rationalizing cost through IT. The acquisition of SAIC’s global oil and gas information technology practice will strengthen Wipro’s existing Energy business
unit,” Wipro Technologies Senior VP (Energy, Natural Resources and Utilities SBU) Anand Padmanabhan said. “As a result of the transaction, about 1,450 employees are expected to move to Wipro across North America, Europe, India and Middle East,” it said, adding that Wipro’s Energy, Natural Resources and Utilities Strategic Business Unit (SBU) is a highgrowth unit and this acquisition will further strengthen Wipro’s leadership position. The SAIC division has significant domain capabilities in the areas of digital oil field,
petro-technical data management and petroleum application services addressing the upstream segment. “IT spend in this sector is expected to grow as customers increasingly look to grow newer streams of revenues, optimize their operational cost and find better ways to become environmentally conscious,” Wipro said. Completion of the acquisition is subject to customary closing conditions and regulatory approvals. In February, Wipro had restructured its business to form six SBUs to accelerate growth of the company.
PHILIPS SA PICKS NCR TO HANDLE IT SERVICES FOR LATIN AMERICA www.nearshoreamericas.com
Technology and solutions provider NCR Corp. has been selected to provide help desk, customer support, and other managed services to the Spanishspeaking customers of Philips S.A. throughout Latin America. As per this new contract, the facility in Buenos Aires will be used by NCR for providing technical support and customer care services with respect to all Philips S.A. consumer products. NCR will also assist with inbound marketing support for promotions and deliver other specialized call center functions. NCR’s selection by Philips SA was based on its successful track record for delivering managed services, as well as the company’s ability to gauge consumer behavior, which will help Philips S.A.
develop strong relationships with consumers and differentiate itself from competitors. The company is making headlines with frequent deal wins. For example, in the month of January 2011, NCR Corp. clinched a deal with Chase, the U.S. consumer and commercial banking business of JPMorgan Chase & Co. (JPM – Analyst Report), whereby the latter would deploy more ATMs incorporating NCR Corp.’s latest Scalable Deposit Module technology. This apart, NCR should benefit from improving trends in U.S. Retail POS markets and the expected increase in DVD kiosk sales. Research shows that roughly 60% of people taking DVDs on rent prefer to do so through self-service
kiosks. The DVD kiosk market has lots of room to grow, with Adams Research predicting $2 billion in revenue through 60,000 kiosks by 2014. On the other hand, the company’s aggressive target of 10,000 DVD kiosks by year-end 2011 and the achievement of break even in its Entertainment business by fiscal 2011 are optimistic goals, given its limited experience in a market with varied dynamics. Although NCR has been diversifying its business in other segments, the company’s forte is Automated Teller Machines (ATM). According to a study published by Retail Banking Research, NCR has been the world’s largest supplier of multi-vendor ATM middleware and applications for 23 consecutive years.
DELL INAUGURATES ISRAELI R&D CENTER www.globalservicesmedia.com
Computer giant Dell recently inaugurated its first R&D center in Israel. It will focus on developing storage technologies and cloud computing solutions, which will be embedded in Dell products worldwide. The R&D center is based on Exanet, which Dell acquired last year. Yossi BenShoshan, formerly Exanet’s CTO and now a senior executive in Dell’s Enterprise
Storage Business, will head the new center. “In the past year, we have accompanied the center in every stage of its development and establishment ahead of the realization of its purpose as a leading and strategic R&D center for Dell,” said Darren Thomas, general manager of Dell. “The Israeli R&D center is at the forefront of
storage and cloud computing technology, and we expect that its R&D achievements will make a major contribution to the further strengthening of Dell’s position as a leading player in these fields.” Engineers and computer scientists should take note that Dell will launch a hiring campaign in the coming months, as more manpower is now needed.
U.S. FIRMS FAVORED LATIN AMERICAN ACQUISITIONS IN 2010, KPMG STUDY FINDS; BRAZIL TOPS LIST www.prnewswire.com
Latin American companies were the most popular emerging market targets for acquisitions by U.S. companies in the second half of 2010, according to KPMG International’s latest Emerging Markets International Acquisition Tracker (EMIAT) study. Those countries accounted for more than 40% of emerging market acquisitions made by U.S. companies during the period. The KPMG study, which tracks completed deals in which an acquirer took at least a five percent shareholding interest, revealed that U.S. companies made a total of 116 emerging market company acquisitions in the second half of 2010, down slightly from 134 in the first six months, with Brazil (21), Central America and Caribbean (17), and other South American countries (10) among the most popular targets. “We believe that Latin America remains an attractive market, with continued GDP growth forecasted, abundant natural resources and commodities, and rising domestic spending by brand-conscious consumers,” said Mark Barnes, principalin-charge of KPMG LLP’s U.S.-High Growth Markets practice. “Many firms in Latin America were ripe for acquisitions as they were undervalued, and there are still deals to be made.” “Brazil clearly stands out, because it is one of the fastest growing economies in the world,” added Barnes. “Brazil has a strong, growing middle class with disposable
GlobalizationToday April 2011
income and an appetite for new goods and services. There are also significant opportunities going forward in specific sectors such as infrastructure and energy as the country gears up to host the 2014 World Cup and 2016 Olympics.” Other top targets for U.S. corporate acquirers in the second half of 2010 included India (16), China (15), South and East Asia (10), and Russia (10), according to the KPMG study. “After a burst of activity early in 2010, the general expectation was that emerging and high growth acquisitions in developed countries would continue to increase,” said Barnes. “Our latest EMIAT survey results show that emerging-to-emerging deals are picking up some speed, as companies shop for access to raw materials, energy sources and consumers in markets that may have many similar characteristics to their own.” Emerging and high-growth market companies made 239 acquisitions in developed economies (E2D deals) in the second half of 2010, down slightly from 265 during the first half of 2010, according to the KPMG study. “The modest decline in acquisitions by emerging market companies in developed economies in the second half of 2010 may have reflected the falloff in consumer buying power and other economic uncertainty in developed nations,” said KPMG’s Barnes. “But even at slightly slower rates of acquisition, the developed
economies remain large, wealthy markets that present major opportunities for investment and expansion by overseas global companies.” Meanwhile, emerging-to-emerging (E2E) deals increased in the second half of 2010 with 132 total deals, up from 118 in the first half of 2010. “Our survey results indicate that emerging market companies are becoming increasingly comfortable making acquisitions among their emerging market peers because there is potential to grow market share and introduce new products due to increasing demand,” Barnes said. For E2E deals, companies in South and East Asia (21), the Commonwealth of Independent States (CIS) (19), and China (15) were the most popular targets in the second half of 2010, according to the KPMG study. Russia was the leading emerging market acquirer in other emerging markets with 23 deals. South and East Asia and Malaysia each made 21 such deals. For E2D deals, South and East Asia (40) was the leading emerging market acquirer of companies in developed economies in the second half of 2010, followed by China and India (each with 37). After the other European countries category (49), the most popular targets for E2D deals in the second half of 2010 included the United States (39) and Australia (21), according to the KPMG study.
GLOBAL AUTOMOTIVE COMPONENT OUTSOURCING MARKET TO REACH $1.09 TRILLION BY 2017 www.globalservicesmedia.com
Global Industry Analysts (GIA) released a comprehensive global report on the automotive component outsourcing market, and the news was heartening. Growth in the market will be driven by increases in automobile production as a result of the post-recession resurgence in consumer demand for new cars, as well as the scheduled development and roll out of new feature-rich vehicle models. Robust growth prospects in Asia-Pacific also augur well for the market. Although the prolonged severity of the economic slowdown and depressed automotive industry have elicited decline in revenue for automotive component outsourcing in the recent years, the market nevertheless is expected to recover its poise in the short to medium term period, to reach $1.09 trillion by 2017. The automobile industry has been one of the worst hit industries by the recession, as the demand for cars witnessed hurting declines, exacerbating the already existing woes of excess production capacities. With vehicle sales nose-diving resulting in plant shutdowns, shockwaves that ripped through the automobile industry were transmitted to the automotive component outsourcing market. The trickle down impact of the depressing business climate in the automotive industry on the global Automotive Component Outsourcing market is reflected in notable declines in growth rates in recent years. Factors that have brought down the automotive industry, such as restricted access to credit, rising levels of unemployment, decline in purchasing power, reduction in household wealth, falling consumer confidence, and postponement of new car purchases, among others have also played instrumental roles in dragging down growth in the automotive component outsourcing market of the auto industry. Unlike periods of economic boom during which the cost of vertical integration is lesser than the â€œtransactionâ€? costs associated with outsourcing, periods of downturn create demand volatility and
inability to reduced fixed costs under a vertical integration. This is because such a structure embodies higher asset intensity, and therefore higher fixed costs, and lesser flexibility to change production levels and product mix and technologies in line demand swings. Despite the fact that outsourcing represents a best business strategy during a downturn when operational/business flexibility becomes crucial to survival, the component outsourcing market weakened during the recession, weighed down heavily by the crushing effect of reduced automotive production. The value and volume of outsourced auto components decreased steeper than total vehicle sales, as consumers also migrated from high-content SUVs and trucks to lower content passenger cars. Smaller and cheaper economy cars have fewer parts/components than their high-end counterparts. Elimination of value added features to produce low-cost vehicles have adversely affected business opportunities for component outsourcing. Independent suppliers witnessed significant reduction in orders for components from OEM automakers during the recession. However, now that the recession has played out and the automotive industry is emerging from previous lows, the worst is over for the automotive component outsourcing market, and a rebound is seen as inevitable over the next few years. Vehicle production is staging a comeback, thanks to increasing consumer demand for new cars, fueled by recovery in GDP
growth, improvements in employment rates, higher income levels, and a rise in consumer confidence. The demand for automotive components for integration into new vehicles will be on the rise over the next few years, creating the need for outsourcing component manufacturing. As stated by the new market research report on Automotive Component Outsourcing, Asia-Pacific remains the most prominent regional market for automotive component outsourcing, with revenues from the region waxing at a CAGR of about 12% over the analysis period. Growth in the Asia-Pacific market is especially driven by the robust automotive production scenario in the region, thanks to growing demand for new cars in emerging countries such as China and India. Major players in the marketplace include ArvinMeritor, Inc., Amtek Group, AGC Flat Glass, Benteler International AG, Autoliv Inc., Bharat Forge Limited, BorgWarner Inc., BorgWarner Turbo Systems GmbH, Continental AG, Cummins Inc., Delphi Automotive LLP, Denso Corporation, Faurecia, Honeywell Turbo Technologies, Johnson Controls, Inc., KIRCHHOFF Automotive GmbH, Lear Corporation, Magna International Inc., Michelin Group, Rane Group, Robert Bosch GmbH, Shriram Pistons, Sundaram Fasteners Limited, Takata Holdings Inc., Tenneco Inc., ThyssenKrupp Steel Europe AG, TRW Automotive, Visteon Corporation, Valeo Group, and ZF Friedrichshafen AG among others.
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RECENT OUTSOURCING DEALS HP Enterprise Services has been awarded a four-year, $68.1 million data center services contract by the U.S. Special Operations Command (SOCOM). These services will support special operations warfighters in accomplishing their worldwide missions. Under the terms of the contract, HP will provide enterprisewide data center management support services for the U.S. Special Operations Command’s global enterprise information technology server and storage computing environment.
IBM Australia has been awarded a multi-million dollar contract with NBN Co Limited to implement and manage the core business and operational support systems required to operate Australia’s National Broadband Network (NBN). As the prime systems integrator under the three-year contract, IBM will provide consulting services, integration, application support services and software solutions. These essential technologies and services will enable NBN to manage its network, provision and configure services, and bill its wholesale customers.
Accenture has extended for four additional years its contract to provide RSA UK with insurance business process outsourcing (BPO) services. Under the original contract, signed in 2003, RSA outsourced a range of front- and backoffice operations to Accenture, including portions of its sales and service, claims, finance and commercial administration functions that support RSA’s direct, affinity and broker customers. Accenture will continue to provide these services through to the end of 2016 while enabling RSA to have flexibility to meet its customer needs and explore other opportunities to support the online proposition. Services are delivered through Accenture’s Global Delivery Network using centers in Bangalore and Mumbai, India.
NATIONAL GRID SELECTS HP TO INTEGRATE, MANAGE IT SERVICES www.sourcingfocus.com
HP Enterprise Services UK Limited has announced a new seven-year services agreement signed by National Grid plc, a utility company operating in the United Kingdom and northeastern United States. With this agreement HP will provide a flexible, enterprise-wide service management solution to enable National Grid to manage its hybrid technology environment. HP will establish a multi-supplier governance model to deliver a servicemanagement function that will provide a single point of accountability across all of National Grid’s technology and services suppliers. HP will integrate all aspects of the IT service management processes and tools across the National Grid ecosystem, with comprehensive management of service levels to the business requirements. “Technology underpins all of our critical business processes and we need to use technology to operate more efficiently and provide our customers with outstanding customer service and reliability,” said David Lister, chief information officer, National Grid. “We’re working with HP to establish
a service management hub to manage our multi-supplier environment more effectively and to enable us to be more flexible and achieve our cost and service goals.” HP will use a combination of its Enterprise Service Management processes and HP Software, including the implementation of HP Universal Configuration Management Database (UCMDB), HP Service Manager 7, and all the requisite policies and procedures. The agreement also includes dedicated Service Desk Services for approximately 30,000 National Grid employees in the U.K. and northeastern U.S. “Many CIOs are wrestling with the challenge of managing complex hybrid environments that include a combination of traditional as well as private and public cloud,” said Mike Nefkens, senior vice president and general manager, HP Enterprise Services, EMEA. “The HP team brings deep service management expertise and tools with proven operational excellence from managing some of the world’s most complex, multi-sourced environments, helping National Grid compete effectively today and in the future.”
CSC has signed an agreement to acquire all of the outstanding equity of iSOFT Group Limited, one of the world’s largest providers of advanced healthcare IT solutions, by way of a court-approved scheme of arrangement. The company says the acquisition will complement and strengthen CSC’s market-leading software products and healthcare integration and services portfolio, while enhancing its healthcare research and development capabilities. It will also accelerate CSC’s strategic growth plan in the Life Sciences market and reinforce the company as a very strong player in healthcare information.
Genpact Ltd has agreed to buy Headstrong Corp., a provider of consulting and IT services, for $550 million in cash to strengthen its capital markets business. Headstrong, which was founded in 1981 and has centers in India and Manila with a global headcount of 3,700, generated 2010 revenue of about $217 million, Genpact said in a statement. Headstrong focuses on financial services and helps clients manage customer relationships and business processes like help desks. The deal would be funded through existing cash and financing. Genpact sees the deal, expected to close by May 31, adding to 2011 earnings.
Show Me the Money Survey Shows Salaries Up in Outsourcing By The Editors The headlines read these are the worst of times. But if you’re looking for a job in outsourcing, these may very well be the best of times. The 2011 member survey of the International Association of Outsourcing Professionals (IAOP) conducted in January shows outsourcing jobs and wages increased last year. Key findings include: ••More than 40 percent of customer organizations and 62 percent of outsourcing providers and advisors increased the number of outsourcing jobs in the past 12 months. ••Salaries also were up, with 58 percent of advisors and providers reporting raises of 1 to 6 percent or more, and 40 percent of clients saying they increased wages in the same range. The results are based on inputs from the association’s 110,000-plus members and affiliates worldwide with customers, providers and advisers
GlobalizationToday April 2011
from the U.S., Europe, India, Australia, South and Central America, Asia and other important outsourcing regions participating. “Outsourcing has itself become a recognized organizational competency,” says IAOP Chairman Michael Corbett. “Companies are beginning to make the necessary investments to build these skills across their organizations. This new breed of outsourcing professional is advancing management practices and processes that produce consistent, highquality outcomes. PROFESSIONALS OPERATING ACROSS THE BUSINESS IN CUSTOMER ORGANIZATIONS
Hiring increased in 40 percent of the client companies, with about 10 percent increasing their employment by 25 percent or more, 13 percent adding to their ranks by at least 10 percent and about 20 percent growing their workforces in the single digits.
When it comes to pay, 30 percent of customers say they increased salaries by 1 to 3 percent and 10 percent awarded raises of 4 to 6 percent, while the majority of organizations kept pay the same. The results show a typical client organization has 10 to 50 outsourcing professionals that operate across the business with 55 percent in functional
areas, 25 percent in centralized groups supporting the entire business and about 20 percent in shared services. Professionals in customer organizations operate across the outsourcing lifecycle with 29 percent involved in management and governance, 25 percent in implementation, 24 percent in selection and more than 20 percent involved with strategy.
ADVISOR AND PROVIDER WORK WITH CLIENTS IN LARGE NUMBERS
Within provider and advisory firms, hiring grew by more than 25 percent in 11 percent of the organizations, by more than 10 percent in 27 percent of the companies and 25 percent saw single-digit job increases. Salaries went up by more than 6 percent in
about 20 percent of the companies while 16 percent reported wage increases in the 4 to 6 percent range, and 23 percent saw pay rise by 1 to 3 percent. Pay held steady at 42 percent of the companies. Provider and advisor firms generally have larger numbers of outsourcing workers on their payrolls than customer organizations. More than 30 percent of these companies
responding said they employ 250 plus people in outsourcing roles while 20 percent employ at least 50 workers. The majority of these employees, representing 36 percent of the respondents, work in client relationships managing existing contracts while 23 percent work in centralized groups and
GlobalizationToday April 2011
22 percent are on deal teams pursuing new business opportunities. HR MANAGERSâ€™ TOP CONCERNS
Judging from the survey results, HR managers lose the most sleep worrying about finding and keeping the very best
workers. More than 20 percent of providers and advisors responding said recruiting employees with the required skills and experience is their top issue. Other pressing issues are retaining talent at 17 percent and developing the right skills at 15 percent. Managing knowledge also was a main concern voiced by 16 percent
while 13 percent were focused on deploying the right people to the right locations. In customer organizations, nearly 50 percent of executives participating in the survey said that setting compensation levels was an area that the HR department takes an active role in relating to outsourcing professionals.
Determining skills and competencies required for the job was an area of active involvement for 20 percent of HR departments while 15 percent reported they work to develop executive talent management strategies and the same percentage is actively forecasting employment needs.
“Overall, the survey results paint a favorable snapshot of the outsourcing profession with companies hiring, salaries increasing and talented workers in high demand,” says Corbett. “If you’re looking for a job, sharpen your resume because now is an opportune time to explore outsourcing careers.”
BPO and the Analytics Advantage By Mike Salvino and Barbara Duganier It was a textbook problem in the volatile world of retail. In the summer of 2009, a major US music distributor experienced a sudden spike in demand for the CDs of one of the artists in its back catalog. How could it ramp up production to meet immediate needs without creating excess inventory in the future? This company had an edge, however—a longstanding outsourcing arrangement in place that, over a period of several years, had turned its supply chain into a finely tuned, industrialized engine. Moreover, the engine came equipped with a predictive analytics capability that could do more than just tell the company that manufacturing could not meet supply. The analytics could also identify how to solve the problem, leveraging insights across multiple domains beyond the supply chain, including finance and CRM. In short order, the music distributor had pinpointed the source of greatest demand. The company was able to make informed and timely decisions about where to boost production and where the most cost-effective and profitable locations were to locate inventory. Net result: Instead of the costly alternative of increasing production everywhere in the world—which would have resulted in excess inventory and expensive shipping to redistribute products later—the company had an accurate, just-in-time, precisely targeted delivery approach that met customers’ needs for a dramatically lower cost.
Sophisticated tools This is one of a growing list of examples where the intelligent use of analytics in business process outsourcing environments is making a significant impact. As with all applications of analytics, it leverages sophisticated tools and techniques for statistical surveying, root-cause analysis and optimization. Unlike many advanced analytics applications at some companies, however, BPO analytics begins on what is already a strong foundation of comprehensive data about a business process and how it’s performing. Where does such a foundation of high-quality data come from? From outsourcing relationships in which providers are already highly motivated to produce timely data that helps them know, nearly in real time, how efficiently a supply chain, a procurement function, a global finance organization or other business processes are performing.
Three ways analytics drives business advantage The analytics capabilities built on the existing foundation of data from a BPO relationship help companies realize significant benefits in at least three ways. 1. Improving the operational engine The first advantage in building an analytics capability on the back of a BPO relationship is that companies can go to a single source for high-quality data about the performance of a process or function—data that is measured and recorded consistently. An outsourcing provider that is helping to deliver essential business processes such as finance and HR is well placed to analyze the performance of a process end to end, across both client and provider, discovering where inefficiencies and risks exist, then working to drive time and waste out of the process and standardize wherever possible. 2. Discovering hidden insights A second critical area where analytics can deliver greater value as part of a business process outsourcing arrangement is in generating additional insights by tracking data across different parts of the organization. Such a capability can optimize results or help balance apparently competing or contradictory objectives. A common example is the balancing act companies face in reconciling the needs of the procurement and finance organizations. A procurement professional will want to push for early payments to get discounts from suppliers. But a finance professional will look instead to hang on to cash as long as possible. How can both sides of that equation win? The answer is that they cannot—not exactly. But with an analytics capability in place as part of an outsourcing arrangement that bundles procurement and finance, a company can be assured of finding the precise point at which the benefits on both sides of the equation are balanced, helping to generate as much business value as possible by improving cash management. 3. Innovations to drive revenue The third area where BPO analytics offers distinctive value is in helping companies manage data—from the front office, the back office or both—in such a way as to generate innovations or improve time to market to increase revenue
For example, one major company in the health and life sciences industry has established an outsourced center for the testing and assessment processes known as pharmacovigilance. This approach has helped the company to increase productivity by as much as 40 percent. The outsourced analytics capability has enabled the company to collect and analyze data faster, shaving significant time off the approval cycle, more readily identifying drugs with no marketplace potential and getting approved drugs to market faster.
Hard to duplicate Is an outsourcing arrangement the only way to make business process analytics effective? Certainly not. But the foundation of data and process industrialization upon which an outsourcing provider works, using highly sophisticated tools and talent, is hard to duplicate using internal resources alone. Companies that effectively use an outsourcing relationship to embed analytics into their business processes have an opportunity not only to reduce costs and improve process efficiency but also to generate the insights that can lead to market breakthroughs faster and with greater assurance. Outsourcing providers gain enormous insight into the way a client company works, at extremely detailed levels. It would be a missed opportunity if organizations failed to use those insights for competitive advantage. This article is based on ‘The analytics advantage,’ which originally appeared in the October, 2010 issue of Outlook, an Accenture publication. Used with permission.
You can read the full article at: accenture.com/analyticsadvantage
© 2011 Accenture. All rights reserved.
Colombia Comes Into Its Own This Latin American country is becoming a great outsourcing destination. Here’s why. By Santiago Pinzón Galán COLOMBIA: “THE ONLY RISK IS THE RISK OF STAYING”
If you’ve recently seen CNN news in English or “Español”, or you’ve flown to Colombia, that`s probably a TV advertising tagline that you’ve already seen. It’s part of an effective strategy the Colombian government is using to promote the nation worldwide, to help people realize how the country has changed. And it has. Colombia is a hot dynamic economy, so hot that back in 2007 the cover of BusinessWeek magazine labeled this South American nation as one of the “Most Extreme” markets on Earth1 .
Last year Michael Geoghegan, former CEO of HSBC, in his speech to the American Chamber of Commerce in Hong Kong, said: “The new BRICs are Colombia, Indonesia, Vietnam, Egypt, Turkey and South Africa (CIVETS). They are countries with major populations, dynamic, diverse economies, political
GlobalizationToday April 2011
stability and each of them has a brilliant future. Any company with global ambitions will have to take immediate action in these markets.” Colombia is the only Latin America country in that CIVETS new club — a club with great economic potential (see graph above).
COLOMBIA: MAIN INDICATORS 2000
GDP Public Sector (%)
GDP Private Sector (%)
Economic Growth rate
GDP per cápita (US$)
Exports (US$ Millions)
Non Traditional (US$ Millions)
Imports (US$ Millions)
Months of imports
Investment (% GDP)
Foreign Direct Investment (US$ Millions)
FDI (% GDP)
Foreign Debt (% GDP)
Fiscal Debt (% GDP)
Deposit interest rate (yearly average)
Early exchange rate - yearly average (US/$)
Real exchange rate
Devaluation (Real terms)
Employees (yearly average)
Employees private sector
Global participation rate
Last September, the cover of The Economist magazine depicted a map of the Latin America region “down-up” with this provocative title: “Nobody’s backyard, The rise of Latin America”. According to the article “marketing people are beginning to talk about a “Latin American decade”. If the region can keep up the growth of the past few years, it will double its income per person by 2025, to an average of $22,000 a year at purchasing - power parity, Half a dozen Latin American countries may have achieved developed-country status, with an income equivalent to Spain´s today.
Security Insecurity problem in industrial survey (%) Foreign Trade
Debt (% GDP)
By the end of the first 10 years of the new millennium, Colombia´s GDP per capita head has doubled, actually almost tripled, annual Foreign Direct Investment net inflows have multiplied by four and Colombian exports have tripled. This great economic progress has made a social impact as well. Colombia poverty rate was reduced from 53 percent to 30.4 percent and Affiliates to health services grew from almost 24 million to more than 41 million. During the same period, international visitors to Colombia doubled. While tourism in the world fell 4 percent, in Colombia it increased 10.2 percent in 2009, of which 23 percent are U.S. citizens.
REGIONAL SPOTLIGHT Social Indicators Affiliates to health services (thousands)
Affiliates to proffesional risk services (thousands)
Welfare family institutions
Poverty rate (includes subsidies in 2010)
Gini Index (includes subsidies in 2010)
Human Development Index
Primary, middle and high school (to 11th grade)
Education (gross coverage rate)
When it comes to outsourcing, Colombia also is enhancing its role in the Latin America Region and the outsourcing world. The country offers business opportunities and the chance to share success stories to the global business community. Key multinational companies have chosen Colombia as their country of choice to set up BPO and IT services operations. IBM, Citi, SAP, Unisys, Sutherland, Teleperformance, Siemens, Sitel, Microsoft, General Electric, Avanza, Terremark, Convergys, and Indra are but a few. Genpact is going to open operations on the second semester of 2011.And even with its existing presence in Colombia, HP chose the country to develop one of its New Global Service Centers, designed to operate as the hub of multi-functional operations such as technology, business office and sales support in Medellin. Colombia is now part of 2011 Gartner`s “30 Leading Locations for Offshore Services”. This indicates the progress the country is making, as well as the challenges ahead to stay on the list. Different factors help Colombia serve as an attractive destination for outsourcing. A Public - Private Partnership to strengthen and build the BPO&IT “world class sectors”. For instance, the Chamber of BPO&IT at ANDI ( National Business Association of Colombia) lead the creation of the Colombia IAOP Chapter. The Chamber is co-organizing with IAOP and the support of the Proexport the Latin America Outosurcing Summit in Cartagena, May 26&27.
GlobalizationToday April 2011
Geographic location with multiple direct daily flights to major cities in the U.S. and other parts of Latin America, including a time zone shared with the U.S. east coast, are drivers. Human talent and scalability are important, too. According to the IMD World Competitiveness report, Colombia has the second most qualified labor available in the region and offers the best quality education in science and mathematics. It also has the best Labor Market Flexibility Index in Latin America and, according to the World Bank, it is the
third most “Business Friendly” country in Latin America and top reformer in the region. It also ranked among the top countries for investor protection. Moreover, Colombia’s credit rating recently was boosted to investment grade by Standard & Poor’s. The increase puts Colombia’s rating in line with that of Brazil and Peru. S&P’s decision will attract a new class of investors to Colombia, lowering government borrowing costs, spurring investment and supporting economic growth in Latin America’s fourth-largest petroleum producer.
In addition to this, the country offers an export platform: 11 free trade agreements (FTA) with 48 countries allowing preferential access to over 1,500 million consumers. In 2011, Colombia will negotiate 18 international investment agreements (IIA) and 16 double taxation agreements (DTA). The country now offers great incentives to promote industry, such as a 125 percent income tax deduction for investments in scientific and technological developments and a 200 percent income tax deduction for salaries and social benefits paid to handicapped employees. It also offers one of the most competitive Free Trade Zones (FTZ) in Latin America, with a 15 percent income tax and a VAT exemption for goods sold from Colombia to the FTZ, among other benefits. Colombia currently has 91 Free
Trade Zones. Colombia offers scale and alternatives. With major cities such as Bogota, Medellin, Cali, Barranquilla, Ibague, Bucaramanga, Manizales and Pereira, multiple options are available for buyers and suppliers. Thirty cities have a population of 100,000 or more and Bogota produces 67,000 graduates every year, of which, 17,000 are technical graduates. Some of these cities are part of the 600 cities a recent report made by the The McKinsey Institute identified that will contribute half of the world’s economic growth by 2025. At present, the combined workforce of IT and BPO industry in Bogota exceeds 50,000. So, it’s not just an advertising slogan. Colombia truly is a great outsourcing destination and the only risk is the risk of staying.
Santiago Galán Santiago Pinzón Galán is Executive Director of the National Business Association of Colombia. In his role, he leads activities and projects to strengthen the Business Process Outsourcing and Information Technology sector and the country as a global sourcing destination. You can reach him at: Twitter: @santiagopinzong Linkedin: santiagopinzongalan
Fast Track Your Outsourcing Career Here’s advice from top experts in the field on how to move ahead in outsourcing. We provide a “career checklist” that’s relevant to any particular industry niche. By The Editors Don’t think outsourcing is a sexy career? Think again, says D. Zachary Misko. Outsourcing can be adventurous, highlevel and rewarding. In his new role as global director for Kelly Outsourcing and Consulting Group (OCG), Misko has the opportunity to travel to Australia, London and Asia Pacific, and immerse himself in different cultures and geographies around the world. He’s also viewed as an important team player in the C-suite. “Outsourcing is a customer-client relationship where you have a seat at the table” because companies are increasingly recognizing it as a strategic practice to add value, he says. After a 15-year career in human resources, Misko moved to the outsourcing service side and has worked with Fortune 500 companies throughout the world to
GlobalizationToday April 2011
develop and implement processes that improve and drive HR and workforce solutions for the past nine years. Julia Santos, Head of Global Business Optimization for Johnson & Johnson’s Group of Consumer Companies, took a different route into her outsourcing career. She was tapped from the pharmaceutical side of the business to set up an outsourcing organization in the consumer sector to help leadership achieve the greater value they were seeking. She’s also chair of the International Association of Outsourcing Professionals’ (IAOP) Global Human Capital chapter and an IAOP board member. Over the past six years at the job, the results Santos has achieved speak for themselves. She is slowly changing the mindsets about outsourcing and
influencing the culture at a traditional organization rooted in 125-years of history. There are myriad paths to achieving outsourcing success; these two executives are only among many who have found rewarding careers in the profession. Globalization Today magazine asked experts from provider, customer and advisor organizations for their advice on how to go far in outsourcing. Also weighing in was: LeAnne Andersen, Vice President, Global HR Services of Best Buy; Jacqueline Canney, Global HR director for Accenture’s BPO business; and Erica Volini, Principal, Human Capital, Deloitte Consulting LLP. Here’s a checklist of the top 12 tips for moving up in the field.
1. BE INFLUENTIAL AND INNOVATIVE
What does it take to excel in outsourcing? The skills, knowledge, experience and capabilities for the job are extensive, making candidates who have them all in demand. Santos underscored a few of the aspects they are required for the job. He said that candidates should be skilled in communications, business process analysis, strategic business analysis, financial analysis and negotiation. They should be experienced in team leadership, program management, global delivery, relationship management and change management; and capable at leading service teams across cultures. Plus, you should be flexible, adaptable, influential and have an innovative spirit. “Your influencing capabilities have to be the best because there are so many channels and people you have to bring on board,” says Santos. “And you need to have an innovative spirit. You have to have the mentality of ‘what is the next best thing out there? What is better than what I am doing today?’ Individuals looking to go into outsourcing have to have all those pieces working for them.” Having the total package will make you a stand out, says Andersen, who also is chair of the Human Resource Outsource Association (HROA). Individuals working in outsourcing should have deep experience in continuous improvement, including lean Six Sigma, and attention to detail, as well as abilities in the areas of systemic thinking, building cross-functional relationships and a business acumen, according to Andersen. “The best individuals have a natural discontent and desire to create a better tomorrow,” she says. “Not everyone can run an outsourcing relationship. It requires a broad range of skills from the tactical service review to the ability to develop long-term strategic plans. Too often you still see individuals that can drive one end of that spectrum but not the full range. “A great outsourcing professional can demonstrate how their approach to the business has lead to differentiated outcomes, most often in areas of enterprise growth, financial management and service quality.” 2. UNDERSTAND OUTSOURCING IS MORE THAN NEGOTIATING PRICE
The outsourcing department in an organization typically has a much different focus than procurement. The main difference is that outsourcing contributes to both the top and bottom-line growth of a company, Santos says. While skilled at negotiating deals and pricing, individuals working in procurement don’t necessarily have the expertise in specific business areas — such as research and development, IT
and sales and marketing — and skill sets required to succeed in an outsourcing role. An outsourcing professional knows the business first and then procurement second; a procurement professional knows procurement first and the business second, she noted. “The focus for outsourcing and procurement is two different tracks but a lot of companies fail to recognize that,” says Santos of J&J. “Outsourcing is a business strategy that companies can not do without. It’s not about negotiating best price. It’s about bringing total value to the company and that includes efficiencies and effectiveness, quality, business innovation, sustainability and cost reductions from our service providers.” Santos also notes that outsourcing is about managing the strategic relationships or alliances, to contribute to bottom- and top-line growth. “Outsourcing is more holistic in its approach while procurement primarily focuses on the bottom line,” she says. 3. TAKE THE BEST-OF-THE-BEST AND TO MAKE YOURSELF BETTER
Outsourcing service providers working with multiple clients are exposed to a lot of different experiences that you wouldn’t get working with just a single customer, which is a career advantage. Companies are increasingly focused on establishing and spreading best practices through their organizations. If you only work with a single customer for your entire career, you won’t have the broad base of experiences needed to benchmark best practices, says Volini, who recommends rotations across clients for career development, particularly for operations professionals. “Take the best of what you learn and see and put it into your skill sets to make yourself more marketable in the future,” says Misko of Kelly OCG. Pursue leadership and other training programs both inside and outside your organization to advance yourself, our experts say. Accenture, for example, offers an initiative called “Grow BPO” that’s aimed at helping its people develop successful relationships, grow their own careers and work together to grow the company’s BPO business. 4. SEE THE BIG PICTURE
Stay relevant to your client — not only in terms of the process or technology, but also in how you add value beyond what you do on a day-to-day basis, advises Canney. “Outsourcing professionals have the privilege of being on the inside of the client’s business,” Canney says. “Therefore, there’s an opportunity to look deeper at the information and glean valuable insights that may not be evident from just the process itself.”
ONE SOURCE FOR ALL OF YOUR POSSIBILITIES Consider the possibilities that Can be aChieved with a world-Class outsourCing partner improve efficiencies by reducing capital costs associated with daily operations achieve growth by deploying advanced technology and services to enhance the customer experience and strengthen overall brand image implement latest technology and monitoring capabilities to mitigate security risks and meet compliance regulations
turn to diebold as a single point of contact for technology upgrades, risk mitigation, regulatory compliance and more to help streamline processes, improve efficiencies and strengthen your bottom line. For more information, including a new white paper that addresses the operational efficiencies that can be achieved by outsourcing, visit: www.diebold.com/outsourcingefficiency
For example, Canney says, processing payroll can reveal a trend of high employee turnover that could lead the Chief HR Officer to take action to reduce attrition, potentially contributing to bottomor top-line growth. 5. CHOOSE YOUR PARTNERS WISELY
Make sure the partners you select are the ones you can live with over the long haul. “It is incredibly important to select your partners, your team and define your own leadership style consistent with the partnership culture you aspire to have,” says Andersen of Best Buy. “Like any team, engagement is the key to success,” she says. “Leading an outsourcing relationships requires you to be at your best within your own organization and within your outsource provider’s organization too. Getting ahead has a ton to do with your outcomes and your references, regardless of what role you play in an outsourcing relationship.” There are key factors to consider when choosing a strategic partner. If there are many providers to choose from, one must identify their key differentiators and evaluate them. If there are few providers, the sponsor may have to invest more resources in time and money to get the provider to the appropriate level. “Expertise and quality are of utmost importance,” Santos says. “In order to fully understand the provider’s capabilities and differentiators, it is critical to evaluate the provider’s performance and build a strong working relationship. This is especially important in offshore projects. The right location and the right partner must be chosen.” Santos cautions that choosing the right partner in offshore projects is no simple task. “There are always risks associated with offshore locations,” she says. “The risks may include geopolitical issues, skill competencies, local labor laws, legal and intellectual property issues, wage and currency fluctuations, et cetera.” To fully understand the impact of any of these risks, she recommends that you perform a location analysis, to determine if the benefits outweigh the risks. “Outsourcing professionals are skilled in undertaking these evaluations to determine the provider’s strengths and weaknesses, support you in the selection process, and maintain the relationship,” she says. 6. CERTIFY YOUR EXPERTISE
Getting certified as an outsourcing professional will demonstrate to current and future employers as well as clients and colleagues that you are truly an expert. Since IAOP established the Certified Outsourcing Professional® (COP) designation in 2006, nearly 300
outsourcing customers, providers and advisors from around the globe in a diverse range of industries have achieved the recognition. Not only do professionals gaining certifications typically receive higher recognition, they also can command higher compensation and companies can expect consistent, higherquality results by working with these certified individuals. “Professional certification, like any personal development, strongly hinges on the learner to maximize its full potential,” Andersen says. “It demonstrates an individual’s commitment to their career, humility to admit they look outside of their own organization for guidance, and generally acknowledges that they have driven a significant project as the basis of their certification.” Recently, IAOP and HROA joined forces to develop a new advanced COP®-HR designation that will enable individuals who are outsourcing customers, providers or advisers to demonstrate their HR outsourcing expertise. “A certification program that builds the necessary skills is a huge advantage for any HR professional embarking on a serious HR outsourcing program,” says Andersen. “Having participated in IAOP’s COP program, I can attest to its value.” Companies as well as entire countries are backing COP programs. Misko will be among 25 professionals at Kelly OCG taking the COP certification exam this summer. And the program has received the endorsement from the government of Malaysia as an approved training program to build the nation’s ranks of knowledge-enabled professionals. Work in your career for awhile to find your niche and then get certified in that specialty area, recommends Misko, who has earned a number of professional certifications, including Certified Diversity Recruiter (CDR), Certified Internet Recruiter (CIR) and Professional in Human Resources (PHR), as well as advanced certification from the Department of Industry, Labor and Human Relations. 7. UNDERSTAND THE SPECIALIZED TRENDS
Most companies already have outsourced their core functions. Consequently, possessing an expertise in specialized areas that will be part of the next generation of solutions will help you get ahead in your long-term outsourcing career, experts say. “Understand the trends of what is being outsourced and develop depth in those areas,” says Volini of Deloitte, which cochairs IAOP’s Global Human Capital chapter. For example, in HR outsourcing, companies are now looking to providers for help with such specialized areas as workforce planning, recruitment and performance management. “The healthcare industry has been affected by the outsourcing
prospect, just like any other major industry, because the cost savings and talent advantage is so compelling to a global company’s competitiveness,” Santos says. “Although cost savings are still a major factor in the outsourcing business model, we are seeing the transition from low-cost and market penetration objectives to development of high-end technical and Research & Development (R&D) excellence. Our providers must be highly skilled and experienced without sacrificing the low cost benefit.” 8. SIT IN SOMEONE ELSE’S CHAIR
Get deep and broad in your outsourcing expertise and understand how the process you work in is connected to the business as whole, advises Volini of Deloitte. “It’s all about achieving business transformation,” she says. If you work in operations, sit with the IT side of the business and better understand the technology and what it offers. And the techies should get to know what the operations folks deal with, by spending some time in a call center. “They do not operate in silos,” Volini says. “The biggest gaps we see is that technical doesn’t understand the impact it has on operations.” Santos agrees, saying: “In order for outsourcing to be effective, the outsourcing professional must understand the business. We must walk in the business’ shoes. We must speak the same language and feel their pain.” 9. GET INTO THE GEOGRAPHY
To truly expand the breadth of your outsourcing career, you have to spend a significant amount of time in different geographies and gain a deep understanding of the cultures, the executives say. Says Voini: “If you want to say you implement outsourcing globally, you have to do it in a region or country outside the U.S. with a significant population.” “Offshore outsourcing arrangements have many challenges, from culture differences to regulatory or tax concerns, but if handled properly, the rewards are immense,” Santos says. “By far, the most difficult element in managing offshore outsourcing arrangements is the culture challenge.” Santos says that because of cross-cultural differences in mindset, values and approach to business interactions, culture clashes are certain to exist. “This is why effective communication must be primary and at the forefront of any offshore deal,” she says. “An effective communication plan is critical. It will not eliminate the cultural challenges but it will minimize the negative impact it may have on the final result or outcome.”
10. LET TECHNOLOGY BRING YOU CLOSER
Discovering ways to effectively link together virtual client teams is critical and the use of technology is paramount, says Canney, who notes that Accenture uses high-definition video conferencing to connect teams across multiple countries, making them more “real” to each other and clients. “The way we do business in five years or sooner will be very different from the way we have done business,” Santos says. “We will rely heavily on technology to drive relationships. We will go from Supplier Managed Relationships to Network Managed Relationships or Open Book Network Partnering where resources, capital equipment, compounds and services are shared.” 11. NETWORK AND CONNECT
Get involved with an industry association and serve on a committee or board of directors. Not only will networking at a high-level connect you with the right people, it also will be rewarding personally, says Misko, who is involved with a number of organizations, including the Society of Human Resource Managers (SHRM), the Employers Management Association (EMA), the National Association of Personnel Services (NAPS), Best Practice Institute (BPI) and HROA. “Know what you want to achieve in your career and make your goals known,” says Accenture’s Canney. “Build a strong network of colleagues and leverage mentors to provide career advice and guidance.” 12. HAVE STICK-TO-ITIVENESS
In many organizations, outsourcing still is not easily understood. Recognize the culture within the organization you are working for and don’t expect immediate success or easily acceptance from all. Santos has achieved positive results at J&J by having a team of outsourcing professionals embedded in the organization with the needed influence and negotiating skills that can get things done. As their guide, they follow the processes and governance established by her organization. “If you are working in a traditional organization with a more conservative approach, you need a lot of drive and passion,” Santos said. “The hard core professionals will keep sticking at it. You can’t defy the results. If the results are positive and there’s a lot of value for the company, then people will look at it differently.” And lastly, put your career in the right perspective. “In this industry, it’s important to maintain a good work-life balance in order to stay inspired,” Canney says.
VALUE HEALTH CHECK
SRM: YOUR KEY TO SUCCESS By Matt Shocklee
Here are valuable insights into optimizing business value in outsourcing relationships. Welcome to the Spring 2011 edition of Sourcing Relationship Management (SRM) where we share the latest developments, findings and best practices in the use of the Value Health Check SurveyTM (VHCS) to optimize the overall health and business value in outsourcing and/or shared service center relationships. IS A “GREAT DEAL” A SIGN OF A “HEALTHY” OUTSOURCING RELATIONSHIP?
As we all know, the services outsourcing industry (i.e. ITO/BPO/KPO) wasn’t born on the back of academia, in the halls of Harvard, Princeton or Oxford University. Quite differently, the outsourcing industry was conceived in the corner offices of deal making service providers like Ross Perot at EDS and others! So its no surprise when outsourcing customers and service providers use the Value Health Check SurveyTM (VHCS) to perform “health checks” on their outsourcing relationships, the first question often asked is, “are we getting a great deal?” This notion of getting a great deal as a key barometer of success in the outsourcing industry has been around for a long time, however change is afoot. It’s not that getting a great deal isn’t important any longer, results from IAOP Members use of the VHCS indicate quite to the contrary. Users of the VHCS believe that great deals are as important as ever as long as great deals are “sustainable deals” and they support the “vital signs” of health in their outsourcing relationships. SUSTAINABILITY – THE CAPACITY TO ENDURE
A lot is being written today about sustainability. From Wikipedia, the free encyclopedia, sustainability is the capacity to endure. In ecology, the word describes how biological systems remain diverse and productive over time. For humans, sustainability is the potential for long-term maintenance of well-being, which has environmental, economic, and social dimensions. Healthy ecosystems and environments provide vital goods and services to humans and organisms alike. Do some of these terms sound familiar as you consider whether you’ve got a healthy and sustainable outsourcing relationship? Some key take-aways from our VHCS experience is that “sustainability” is a critical success factor not only in creating and sustaining healthy individual outsourcing relationships, but much more important as organizations are challenged to manage a portfolio or “ecosystem” of outsourcing relationships across their globally dis-aggregated enterprises. Achieving sustainability in individual outsourcing relationships is elusive and when considering achieving sustainability across a portfolio or ecosystem of outsourcing relationships, we’re just scratching the surface.
GlobalizationToday March 2011
ACHIEVING SUSTAINABILITY – OPTIMIZING THE VITAL SIGNS IN OUTSOURCING RELATIONSHIPS
Achieving sustainability in outsourcing relationships takes us back to the discussion of ecology and the human body. To sustain well-being and a healthy human body, medical science has taught us that there are “vital signs” that can be indicators of overall health and sustainability of the human body. From the rapidly emerging management science in the outsourcing industry, we’re learning similar things. Like the human body, outsourcing relationships are complex, have many moving parts and must be sustainable as they react to the dynamics of an increasingly global economy. What we’re learning through the VHCS is that sustainability of outsourcing relationships is dependent upon outsourcing customers and service providers gaining the appropriate level of mutual transparency into the vital signs of health in their relationships. These vital signs represent key business needs and/or value expectations from both parties in the relationship. The challenge and art of the science is how to obtain the appropriate level of transparency and then sustain the proper balance in these vital signs of health as the world around us continues to change. As with our bodies,
VALUE HEALTH CHECK well as they’ve not been in offering access to their tools/technologies in a more collaborative manner. And, with multi-sourcing increasingly being adopted as an enterprise outsourcing strategy, getting competing service providers to share data/information about operational performance has been difficult at best. So, what’s the definition of a “great outsourcing deal?” Is it synonymous with or does it contribute to a great outsourcing relationship? Increasingly we find that if the outsourcing deal is built from the outset with sustainability in mind and if organizations periodically check the health of their outsourcing relationships, their much more likely to have sustainable, healthy and highly performing outsourcing relationships! It just makes sense. VHCS Process At-A-Glance
VHCS users are finding that taking a periodic “health check” of the vital signs of health in outsourcing relationships just makes sense. These vital signs, in the context of using the VHCS as your health check tool, are forty (40) value statements embodied in the Sourcing Relationship Value FrameworkTM. The Sourcing Relationship Value Framework is a model, that when implemented through the VHCS (a cloud-based Software-as-a Service diagnostic tool), enables outsourcing customers and service providers to quickly, effectively and affordably take a health check of their outsourcing relationships. IAOP Corporate Customer and Service Provider Members receive two complimentary VHCS per year and non-members may acquire VHCS for a nominal fee. A common challenge voiced by customers and service providers in determining real-time health of their relationships is real-time mutual transparency into business operations to access the level of data/ information required from outsourced operations, especially given globally dispersed workforces. In more highly regulated industries such as financial services, healthcare and life sciences, controlled transparency to accurate and real-time data/information is becoming a major barrier to healthy outsourcing relationships. The good news is that there are advanced tools and technologies that are emerging in the market to assist in data/information access, analytics, interpretation, presentation and protection. The bad news is that outsourcing customers are woefully under-budgeted, under-staffed and under-informed about the capabilities available to accomplish this. Service providers are at fault as
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Find out more at www.bcs.org/iseb/specialist ITIL® is a Registered Trade Mark of the O ce of Government Commerce in the United Kingdom and other countries. COBIT ® is a trademark of the Information Systems Audit and Control Association and the IT Governance Institute. The British Computer Society (Registered charity no. 292786) 2011 MTG/AD/925/0311
HOW TO FORGE THE “PERFECT” PARTNERSHIP By Tony Collins
Many financial services providers are reporting significant benefits from outsourcing product development and administration to trusted third parties. As we explain below, these partnerships can provide a helping hand for launching new financial products. During the past 10 years, the financial services sector has become more competitive than ever, with many companies now fighting to differentiate themselves in an overcrowded market. Today, a key part of this battle is the ability to launch innovative financial products that savvy investors will find appealing — and to do it very quickly. A common fear among organizations in this sector is that they will need to build whole new systems or address large-scale IT change, administration and regulatory requirements in order to launch a new financial product. However, that is not always the case. Most financial institutions are actually set up to develop new and innovative products — they often just need to find the right development path to take the product to market. In fact, if they wish, financial institutions can delegate the majority of the hard work involved in a new product launch and focus instead on creating a financial product that is in tune with the market and what customers want. A HELPING HAND
Even for an established provider, the cost of developing and launching a completely new product and/or distribution channel can be very high. Product development is also a medium to long-term commitment, as staff and premises will often need to be employed for up to five years, even if the initial campaign might only last for one or two years. An increasing number of banks are therefore working with outsourcers to develop, launch and administer a wide variety of new products, since companies that specialize in this area can reduce the time-to-market for these products dramatically and yet still meet the demanding standards that the provider expects from its own in-house development teams. In addition, by using an outsourcer for third-party administration, financial services companies can also delegate the responsibility for time-consuming tasks such as customer communications, product distribution, marketing and more by partnering with a provider that is able to link in seamlessly with their regular day-to-day activities, procedures and operations. As such, third-party experts can effectively mirror the activities that would normally be handled by the financial services industry in-house, including issues related to actuarial support, compliance, business administration and IT. A specialist outsourcer can help to ensure that all implementation stages are routinely quantified and assessed against industry standards, with management reports provided on a daily, monthly and quarterly basis.
THE POWER OF PARTNERSHIPS
The key to making sure that outsourcing delivers the desired result is to view the relationship as a true partnership. As such, when working with an outsourcer to launch a new financial product, financial services providers need to begin with a few basic (yet essential) questions: • Will this product appeal to our clients? • How will this product fit with what the market expects from us? • How can we make sure that it accurately reflects our brand? • Will it meet our particular needs in terms of return on investment, risk and service quality? By beginning with these questions, financial services providers can work with an outsourcer to design a new product “from the ground up”, and therefore differentiate themselves with unique products that will stand out in this crowded market. At this stage, the outsourcer can then take charge of everything from new business processing and administration to data migration and management reports. A CHANGING MARKET
As technology continues to develop, financial services providers will increasingly need to make sure that they have access to a robust technology platform that will enable them to offer and support any new products through multiple channels, whether that means via the Internet, on mobile devices, an extranet site, through the post and/or by telephone. Access to this kind of technology will play an essential role, not only when launching new products, but also in supporting them once they’ve been brought to market. Before long, retailers, supermarkets and other new entrants to this market will be launching new financial products of their own, and will therefore be facing these same challenges. As companies outside the financial services sector begin developing and selling unique “ownbrand” mortgages and pension products, expert advice in these areas will be essential. Companies like these will therefore benefit greatly from working with outsourcers, since they may not have the in-house expertise required to bring these new products to market quickly. Regardless of the type of company launching a new product, an outsourcing partner should be able to produce comprehensive technical specifications and delivery plans within very short time frames, using systems that are bespoke to the company’s specific needs. Above all else, the real key to the successful launch of a new product will rely on the outsourcer’s unique expertise and strong understanding of the financial organization’s requirements and product concept — and that is the true power of partnerships. ABOUT THE AUTHOR
TonyCollinsisCEOofOPAL,aleadingUnitedKingdombased outsourcing business that specializes in the financial services industry. Tony has helped transform and develop several highly successful businesses. Working exclusively within the financial sector, OPAL provides outsourced administration, new product launches and distribution services. For more, visit the company’s web site: www.opal-uk.com
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SWAT ON THE SCENE By John Persinos
A longtime expert in aviation outsourcing discusses the right ways to serve the global community of aircraft owners and operators — as well as the wrong ways. The proper outsourcing of aviation maintenance is measured in more than just dollars and cents – it’s also measured in human lives. That was the overriding message of an interview that I conducted with John Stewart, president and general manager of Dallas-based Southwest Airframe and Temp Services, better known by its nononsense acronym: SWAT. SWAT performs onsite fuel system maintenance, including fuel tank repairs and inspections. As John Stewart told me during the interview, his company provides a specialized and extremely vital service that clients “don’t think about, until they need it”. SWAT is the largest company in its field, with a focus on the bizjet market. Stewart made a strategic decision to target bizjets, to carve out a specialty in that growing niche, but his company can tackle just about any type of aircraft. SWAT works for the Original Equipment Manufacturers (OEMs), either behind the scenes or for their service centers. It also works for most major corporate maintenance facilities that outsource maintenance. Below are the most salient excerpts of my interview with Stewart. PERSINOS: DOES INCREASING RELIANCE ON OUTSOURCING ADVERSELY AFFECT AIR SAFETY?
Stewart: Absolutely not, despite recent concerns. If in fact done properly, outsourcing should increase air safety. Why does a company outsource? The number one reason is economics. This translates into competitiveness in the marketplace. Air safety is compromised when sub-standard outsourcing is hired in a precarious way. Companies considering outsourcing should thoroughly examine the company they intend to hire, their internal safety standards and evaluate the motivation behind outsourcing. WHEN IT COMES TO YOUR NICHE, WHAT ARE SOME OF THE RECURRING MISTAKES AND PROBLEMS THAT YOU SEE, IN TERMS OF OUTSOURCING FUEL SYSTEM MAINTENANCE?
The number one problem is the rush. But as far as outsourcing fuel tank repairs, I would say the biggest mistake is scheduling deadlines and proper completion of initial and final fuel leak checks. The typical problem is unrealistic completion schedules, and as hard as we strive to meet our customers’ expectations, one, and only one factor, affects air safety more than any other, and that’s time. Money is time, and people try to rush the job to save money.
HOW CAN OUTSOURCING COMPANIES SUCH AS YOURS THAT PERFORM FUEL SYSTEM MAINTENANCE AVOID THESE PITFALLS?
Avoiding costly mistakes can be greatly reduced by allowing for estimated downtimes. Cure times are always a concern and can usually be accelerated in some manner. If we need 10 days, don’t push for six. Trust me, it would probably take you 20. DON’T THE CLIENTS – THE END USERS – NEED TO GET INVOLVED, TOO? SHOULDN’T THEY TAKE OWNERSHIP OF THE WORK THAT’S PERFORMED?
End users definitely should get involved. The end users, often in our case chief pilots that manage flight departments, generally do make themselves available for critical decision-making issues that arise in fuel system maintenance. They shouldn’t just drop it off and disappear — and most don’t. IN OTHER WORDS, WHEN CLIENTS WALK AWAY FROM THE WORK, SAFETY VULNERABILITIES ARISE. ELABORATE ON HOW CLIENTS NEED TO GET MORE DIRECTLY INVOLVED.
Make sure your maintenance provider is giving you a clear and concise picture of what is going on with your aircraft. Don’t shortcut the critical stuff and expect perfection. One example: Don’t reinstall a 30-year-old fuel cell that has been properly repaired and expect it to last or be warranted. A new one may cost you a small fortune but you can’t afford the stress of recurring problems and safety concerns that may arise, forcing you back into maintenance. Again, when it comes to fuel system repair and maintenance, it’s important to do the job right, allow for sufficient time on your schedule, and avoid the temptation to rush. ABOUT THE AUTHOR
John Persinos is editorial director of Globalization Today magazine: john. email@example.com. To read his archived blog online, go to our magazine’s home page and click the Blog hyperlink: http://globalizationtoday.com
WHAT’S HAPPENING AT THE IAOP WELCOME NEW IAOP MEMBERS IAOP is pleased to welcome new and renewing corporate and professional members from: Accenture; AstraZeneca; AT&T; Aviva; BECKMANN BIO sprl; Capella University; Capgemini N.A.; Carlsberg; CB Richard Ellis; Chinasoft International; Colliers International; Compass America Inc.; Compass Management Consulting; Compassion International; CSC; DATAMARK, Inc.; Dialogue Marketing; Diebold, Inc.; e.services Africa Ltd.; Executive Operations Management; Foley & Lardner LLP; GASSCOM; General Motors; Haggar Consulting Group; Hamilton Enterprises; Haynes and Boone, LLP; hiSoft Technology International Limited; Houghton Mifflin Harcourt; HSBC; IBM; Infosys Technologies; Insigma Technology Co; John Hancock Financial Services; Johnson & Johnson; KelTrust Systems Inc.; Legg Mason; Lexmark International; Manulife Financial; Microsoft; Morgan Stanley; NIIT Technologies; Outsource Partners International; PA Consulting; PCCW; PepsiCo; PwC; Purdue Pharma; Robert Kennedy College; RR Donnelley; SENECOR; SGA2; SoftServe; Softtek; SPi Global; Symantec Corporation; The Goodyear Tire Company; TPI; UBC; United Airlines; Universidad de ciencias aplicadas; UNLV; Vertex Business Services; Websoft Ltd; WNS Global and Xerox Corporation.
REACH THE TOP!
For information on IAOP membership, e-mail firstname.lastname@example.org.
CONFERENCES & EVENTS THE 2011 LATIN AMERICAN OUTSOURCING SUMMIT May 26-27, 2011 | Las Americas Global Resort and Convention Center, Cartagena, Colombia
The 2011 IAOP Latin American Outsourcing Summit is a first-of-itskind global event bringing the thought-leadership and global network of IAOP together with leaders from across the Latin American business community. The result is an exceptional opportunity for individuals and organizations involved in outsourcing as customers, providers, and advisors to both understand and leverage the explosion of outsourcing taking place across the region. Whether you think of Latin America as an outsourcing destination, as a market for your company’s services, or as the region you call home, this is a not to be missed global business gathering. Organizations such as Accenture; Bancolombia; Baker & McKenzie; Booz & Company; Brasscom; Capgemini; CB Richard Ellis; Colliers International; Colombia’s Ministry of Commerce, Industry and Tourism; The Economist; Ecopetrol; HSBC; InvestChile (CORFO); ITSqc; Johnson & Johnson; Kirkland & Ellis; Matryzel
GlobalizationToday April 2011
WHAT’S HAPPENING AT THE IAOP
MEMBERSHIP Membership in IAOP provides access to an extensive array of services, and just as importantly distinguishes organizations and professionals as leaders in the field of outsourcing. IAOP membership demonstrates a commitment to innovative thinking, continuous performance improvement, and to the sustaining development of outsourcing as both an industry and as a profession. CUSTOMER CORPORATE MEMBERSHIP Organizations that are currently outsourcing or are considering one or more outsourcing initiatives should become Customer Corporate Members of IAOP. This membership provides organization-wide access to the association’s research, training, certification, and networking programs - all designed to help companies achieve better business results through outsourcing. PROVIDER/ADVISOR CORPORATE MEMBERSHIP Outsourcing service providers and advisory firms should join IAOP as Provider/Advisor Corporate Members. This membership provides the same organization-wide access to IAOP’s research, training, certification, and networking programs as Customer Corporate Membership, but also includes member-only sponsorship opportunities that serve the marketing and business development needs of these companies. PROFESSIONAL MEMBERSHIP Professional Membership is available to individuals either as part of their company’s corporate membership or on an individual basis. This membership serves the needs of practitioners working in the field of outsourcing whether as customers, providers, or advisors. In addition, it provides these professionals with direct, personal access to association services.
Special Offer! Sign up for Professional Membership before May 15 and
we’ll send you the Outsourcing Professional Body of Knowledge (OPBOK) electronic templates and an IAOP messenger bag from our IAOP estore for free. That’s a total value of nearly $85! To get this deal, go to www.iaop.org/ PMregistration and enter offer code IAOP-PM-TMP11 For information on IAOP membership, e-mail email@example.com. Consulting; Nearshore Americas; neoGroup; PwC; SABMiller; Softtek; Teleperformance; Zona Franca Bogota; and many others are already slated to participate. The newly elected president of Colombia, Juan Manuel Santos, has committed the support of his office and, schedule permitting, expects to personally participate and address delegates. In addition to main session keynotes, three in-depth tracks allow delegates to build an event that fits their particular needs and interests. • Track One features real-life customer experiences — giving delegates the chance to learn firsthand from the experiences of customer organizations across the globe. • Track Two focuses on how we benefit from outsourcing — geared toward those individuals charged with making outsourcing work for their organizations, the track will delve into the challenges of doing multi-country outsourcing deals, opportunities in global outsourcing and developing globally-competitive talent. • Track Three will explore the future of outsourcing in Latin America with sessions designed to dig deeper into the various countries, what’s happening there today, and most importantly, what the experts expect to happen over the next 24 to 36 months.
IAOP membership provides access to a wide range of services designed to help you and your organization improve outsourcing outcomes. Many of these services are included as part of IAOP’s Professional or Corporate Membership, with discounts available for use beyond the level provided. Some services are also available individually at non-member rates. • Globalization Today - The official publication of IAOP creates the largest and best informational publication on outsourcing by uniting and tapping the collective intellect of individuals from around the world. IAOP Members receive a free subscription plus the opportunity to get published, promote products/services and advertise. • IAOP’s Knowledge Center, Firmbuilder.com® - This online repository houses more than 1,000 articles, including chapter meeting presentations, conference proceedings, industry whitepapers, research articles and more. • Chapter Network - Through its active and expansive chapter network, IAOP members can share their expertise and find knowledge on best practices for specific industry segments, topics and geographic areas within outsourcing. • Conferences & Events - IAOP hosts the world’s best-known and most highlyrespected executive conferences on the topic of outsourcing. • Certified Outsourcing Specialist Family of Certifications - Receive 50 complimentary COS tests each year. • Value Health Check Survey - This web-based diagnostic tool provides outsourcing customers and service providers with rapid insights to realizing outsourcing value. • BestOutsourcingJobs.com - Companies seeking the best talent for outsourcing jobs, as well as professionals looking for employment opportunities, can benefit from this IAOP member service provided through BestOutsourcingJobs.com (BOJ). For more detailed information, visit www.IAOP.org/MemberServices. CALENDAR OF EVENTS
IAOP CHAPTER MEETINGS IAOP chapters provide a forum for members to collectively focus on professional development, networking, and the advancement of outsourcing within specific areas of common interest. Each chapter is led by chairs and co-chairs with deep knowledge in the area covered. IAOP members are members of the association, and not of a specific chapter, and are encouraged to participate in as many chapter meetings as they wish. Non-members are welcomed to attend any chapter meeting as IAOP’s guest to learn more about the association and its work. •
NORDIC CHAPTER MEETING ON “THE BOUNDARIES OF OUTSOURCING”, “THE BALANCE BETWEEN KEEPING ACTIVITIES IN-HOUSE AND OUTSOURCING” AND “WHY INSOURCE ACTIVITIES THAT HAVE PREVIOUSLY BEEN OUTSOURCED?”
MIDWEST CHAPTER MEETING ON “CONTACT/CALL CENTERS – CONNECTING THE WORLD THROUGH THE MIDDLE OF AMERICA!”
TRANSBOUNDARY SOURCING CHAPTER WEBINAR ON “SOURCING FROM AFRICA – OPPORTUNITIES & CHALLENGES”
CHICAGO CHAPTER MEETING
DATA SECURITY & PRIVACY CHAPTER WEBINAR ON “A PRACTICAL APPROACH FOR PROTECTION AGAINST FINANCIAL MALWARE
THE 2011 OUTSOURCING TOOLS SYMPOSIUM – EAST COORDINATED BY THE NEW YORK, NEW ENGLAND, CLOUD COMPUTING AND OUTSOURCING TOOLS & TECHNOLOGY INNOVATION CHAPTERS
To join and view a full listing of our current chapters, go to www.IAOP.org/Chapters.
AD Introductory Pricing Now Through April 30! Register for The 2012 Outsourcing World Summit at www.IAOP.org by April 30, 2011 and get the lowest rate offered all year! Globalization Today Subscribers: Enter code ‘OWS12GT’ to save an additional $50.
Produced in association with FORTUNE® Custom Publishing
The 2011 Outsourcing World Summit
FIND OUT HOW TO LEAD YOUR COMPANY TO SUCCESS IN THE NEW OUTSOURCING LANDSCAPE. IAOP® presents the 14th edition of its world-renowned conference on February 21-23, 2011 at the Renaissance Esmeralda, Indian Wells, California. Over the last two turbulent years, the outsourcing industry has actually grown! Companies have found that outsourcing has shifted from a management option to a management necessity. With this, buyers are looking at further expanding their future outsourcing programs across more divisions, advisors are sought out more than ever to help firms navigate and protect their interests in tough terrain, and providers are facing the challenges that come with presenting outsourcing solutions in today’s more complex environment. This has created an environment where outsourcing professionals are sought after for advice and counsel by their companies. The 2011 Outsourcing World Summit will delve deeply into issues critical to today’s professionals and companies including globalization; rural sourcing; corporate social responsibility (CSR); cloud computing; managing risk through sourcing strategy – multi-service provider environment, best of breed and offshore; knowledge process outsourcing (KPO); today’s outsourcing tools & how-tos; vendor management; outsourcing as a procurement discipline; transition and governance; exploring new geographies & transboundary outsourcing; and government outsourcing. To view the full program and to register, please visit www.IAOP.org/Summit.
WHAT’S HAPPENING AT THE IAOP
Discount Pricing: Attend The 2011 Latin American Outsourcing Summit at the low rates of $375 for IAOP members and $400 for associate and non-members. Register at www.IAOP.org/LATAM through April 15, enter offer code: LATAMSAVE5 to save 5%. For information on sponsoring and exhibiting, please contact Renee Preston at firstname.lastname@example.org. THE 2012 OUTSOURCING WORLD SUMMIT® February 20-22, 2012 | Disney’s Contemporary Resort, Lake Buena Vista, Florida
Register now at www.IAOP.org and get introductory pricing PLUS a $25 resort gift card! IAOP® presents the 15th edition of its world-renowned conference - The Outsourcing World Summit - on February 20-22, 2012 at Disney’s Contemporary Resort, Lake Buena Vista, Florida. Every year, hundreds of outsourcing executives from across the industry and around the world who are seeking the very latest insights and ideas attend the Summit. Educational sessions deliver specific actionable solutions to current challenges faced by experienced professionals. Case studies feature actual experiences and the lessons learned, and discuss new ideas, approaches and opportunities. The Outsourcing World Summit has become the event that executives attend each and every year to stay informed of the latest developments affecting the outsourcing industry and their profession. Hurry! Introductory pricing ends April 30! Globalization Today subscribers may enter code ‘OWS12GT’ and save an additional $50! NEWSWIRE RECORD NUMBERS ATTEND OUTSOURCING WORLD SUMMIT TWO HONORED AS MEMBER OF YEAR
of international attendees coming from China, Colombia and Canada, to hear the latest strategies to lead companies to success in the new outsourcing landscape. “Outsourcing remains an important business strategy that must be linked to both business and functional strategy,” said keynote speaker Sandy Ogg, former chief human resource officer at Unilever and operating partner for Blackstone Group in New York. Ogg was also inducted into the prestigious Outsourcing Hall of Fame during the event, along with William F. Concannon, president of global corporate services at CB Richard Ellis. TWO IAOP MEMBERS OF THE YEAR LAUDED
IAOP recognized Chris Long, chief operating officer of StayWell Health and Management, and Bobby Varanasi, chairman and chief executive officer of Matryzel Consulting, Inc., as “Members of the Year” for their work to advance the outsourcing industry. The two long-time corporate members were honored at a luncheon ceremony attended by hundreds for their demonstrated commitment to the growth of IAOP and their leadership in the promotion and delivery of the association’s programs. Long chairs IAOP’s Voice of the Customer Chapter and is a member of the Membership Committee and GEO Subcommittee. He also facilitates the customer-only networking sessions at The Outsourcing World Summit. A Certified Outsourcing Professional® (COP), he is an advocate for IAOP’s Corporate and Professional Development Programs. “It is an honor to receive the Member of the Year award from such a prestigious organization during such an exciting time in the evolution of the outsourcing industry,” Long said. Varanasi, an IAOP Global Ambassador, chairs IAOP’s Malaysia Chapter and is an authorized trainer for the COP master class. He has been instrumental in introducing the COP program around the globe and winning support for the program from the Malaysian government. IAOP’s COP program is the first senior management program the Malaysia government has endorsed.
Outsourcing demonstrated its strength as a global platform to grow and transform businesses with record numbers of professionals coming together to chart the industry’s future at the 2011 Outsourcing World Summit®. More than 700 professionals from 32 countries attended the International Association of Outsourcing Professionals’® (IAOP®) annual conference, Feb. 21-23, at the Renaissance Esmeralda, in Indian Wells, California, making it the largest in the event’s 14-year history. “We stand on the cusp of a new state of outsourcing as a global platform for transformation and growth driven by integrated teams of high-value professionals using advanced management practices and processes,” IAOP Chairman Michael Corbett told delegates during his key-note address. Outsourcing customers, providers and advisors from leading companies converged at the summit with the largest numbers
WHAT’S HAPPENING AT THE IAOP
“In a globalized marketplace, international associations with forward-looking leadership often create compelling impacts,” Varanasi said. “IAOP has and continues to do so steadily through leveraging its global membership successfully, to the point that IAOP has become the de-facto go-to organization for anyone looking to understand global sourcing and corporate strategy.” GLOBAL MOVEMENT
In addition to the U.S. and Canada, the emerging offshoring nations of South America also participated strongly in this year’s Summit and delegates also were in attendance from the European Union, several African nations and Australia. Among those participating was Chile-IT, a non-profit organizing preparing Chilean IT companies to outsource their services to the U.S. “Our involvement with the event was a huge success and we were extremely grateful for the large turnout,” said Chad Walter, Chile-IT, Vice President of Operations, North America. “We made a lot of helpful connections that will be pivotal for Chile-IT’s U.S. efforts. We look forward to more partnership opportunities with IAOP in the future.” IAOP also reported a strong turnout among customer organizations purchasing outsourcing services, as well as providers, advisors and those in academia. “Customers, service providers and consultants were all present in strong numbers and a growing cadre of academics is increasingly providing robust intellectual foundations to the constructs
of customer value and competitive advantage that underpin outsourcing globally,” said Phil Hadcroft, chairman of IAOP’s Australia/New Zealand Regional Advisory Board. “The seniority and authority of attendees could not be missed. This conference is increasingly being seen as a lodestone that attracts the leading thinkers and practitioners of outsourcing around the world.” In addition to The 2011 Latin American Outsourcing Summit, taking place May 26-27, 2011 in Cartagena, Colombia, IAOP also announced that its 15th edition of the world-renowned annual Summit will be held Feb. 20-22, 2012 at Disney’s Contemporary Resort in Lake Buena Vista, Florida. For more information and special introductory rates, see the IAOP Web site. CERTIFICATION & PROFESSIONAL DEVELOPMENT COP MASTER CLASS SCHEDULE
The COP Master Class is a great option for reaching up to half (75 points) of the Knowledge and Training points needed for certification, or for COPs to earn 20 recertification CEHs, or to fully complete the required training for the aCOP designation. IAOP is actively registering now for the following classes: • JUNE 20-23, 2011: KUALA LUMPUR, MALAYSIA • JUNE 27-30, 2011: KINGBRIDGE CONFERENCE CENTRE, TORONTO, CANADA • SEPTEMBER 19-22: INVERNESS HOTEL & CONFERENCE CENTER, DENVER, CO • OCTOBER 19-21, 2011: HARBOUR PLAZA METROPOLIS, HONG KONG • NOVEMBER 21-24, 2011: KUALA LUMPUR, MALAYSIA
Please visit www.iaop.org/training_calendar for a full list of classes and current discounts and specials. PROFESSIONAL DEVELOPMENT RESOURCES AVAILABLE!
No matter what industry you are in, IAOP has resources available for all outsourcing professionals. For the latest titles from IAOP, ITSqc and others please visit www.iaopbookshop.com, and get 15% off of any title you order. Also new from IAOP are titles from the American Bar Association found at www.ababooks.org/ affiliate/iaop CORPORATE PROGRAMS
IAOP’s private master class calendar is filling up with Corporate Companies taking advantage of educating their employees in-house!
GlobalizationToday March 2011
WHAT’S HAPPENING AT THE IAOP
With the dramatic cost savings, there is no better time than now to use up your training budget. Host an in-house class for between 10 and 25 employees, partners and customers and save on time and travel. Classroom training will be delivered by an IAOP Authorized Trainer at your facility with each student who successfully completes the COP Master Class provided with a Certificate of Completion noting that they have earned 75 points toward the COP designation and fulfilled the aCOP training requirement. Leading firms like Accenture, Allstate, American Express, Ameriprise, Applied Materials, Avasant, Blue Cross Blue Shield, Capgemini, Capital One, CB Richard Ellis, Colliers, Convergys, Deutsche Bank, Diebold, Firstsource Solutions, Fuji Xerox, Hewlett Packard, Heineken Netherlands, Infosys, ISS, John Hancock, Johnson & Johnson, Kirkland & Ellis, Kraft, Liberty Mutual, Long View Systems, Manulife, MDeC, NCR, Nike, Orange Business Services, Pfizer, PricewaterhouseCoopers, Procter & Gamble, Quint Wellington Redwood, Rogers Communications, SAB Miller, Oracle, Symantec, Unisys, US Department of Labor, VADS Berhad, Vodafone, Whirlpool, Wipro, Xerox, and Zurich Financial Services have embraced IAOP’s training and certification programs as a key element in their organiztion’s program for exceptional outsourcing outcomes. Executives interested in bringing the COP program division- or company-wide are invited to contact your account executive or email email@example.com.
TEST YOUR OUTSOURCING PROFESSIONAL SKILLS (GET A FREE GIFT IN THE PROCESS)
Are you prepared to successfully manage outsourcing initiatives? Do you have the knowledge and experience needed to the industries most elite Certified Outsourcing Professionals? Begin your journey to earning one of IAOPs most distinguished designations by testing your outsourcing professional skills with IAOPs 10 question quiz. (please download it here: http://www.iaop.org/Download/Default.aspx?ID=1595 Once you have completed the quiz email it to copprogramservices@ iaop.org for your results. Those who submit the quiz will receive a complimentary sample Outsourcing Professional Body of Knowledge (OPBOK) print version from IAOP partner Van Haren Publishing. IAOP’s Corporate Development programs address the growing need for organizational-wide outsourcing expertise through standards covering the end-to-end outsourcing process and training and certification programs to enhance the skills and abilities of the individuals who design, build, implement and manage outsourcing initiatives as well as those who are skilled in the delivery of outsourced services. Training and certification through IAOP reflects the highest industry standards and achievement criteria, and are the de facto programs recognized by customers, providers and advisors of outsourcing services.
IAOP Takes it on the Road
Debi Hamill, Senior Managing Director of IAOP kicks off the Hong Kong chapter meeting.
e attendees at th rbett, talks with Co ike M , an m g. IAOP’s Chair chapter meetin llowed the Pune reception that fo
World Summit®, IAOP’s largest global gathering, The Outsourcing ship team, leader The there. stop ’t doesn work our but has wrapped, the road on things took t, including IAOP Chairman Michael F. Corbet g effort ongoin our of part as ers memb with g this month, meetin of outsourcing to further the profession and understand the needs professionals across IAOP’s global community. in the The first stop was Rome, where IAOP participated r cochapte Italy IAOP’s by zed organi ” 2011, “Conferenza Outsourcing degli Studi di sità Univer the from COP, PhD, Vaia, ni Giovan Dr. chair, Salerno. of the The next stop was Zurich for the successful launch s Service ss Busine e Orang e, Switzerland chapter, chaired by Deloitt te, keyno the ed deliver t Corbet el Micha s. Service ial and Zurich Financ it and IAOP’s “Learnings from The 2011 Outsourcing World Summ Global Programs.” the Northern Quint Wellington Redwood then played host to by Ron joined was team IAOP The g. meetin Europe Advisory Board van der Eijk of Robert ne, Vodafo of r Herlaa Rene Quint, from n Broere PwC and Katie Gove of Trellis. the site of a The office of Morrison & Foerster in London was included Bill ers Memb Board. ry planning meeting for the UK Adviso Accenture, of Hindle John , Vertex of Pascoe Graham Payne of IBM, of Hinduja Ghosh nkar Subha er, Alistair Maughan of Morrison & Foerst . Infosys of r Iyenga th Srikan and Global Solutions, a. Corbett A three-city tour of India was next on the agend was on and Pune in ve Concla al Nation CII’s of ce addressed the audien d by Zensar hand for the launch of IAOP’s India (Pune) chapter, chaire ate members in Technologies. The team met with many IAOP corpor lore. Banga and ai Mumb Corbett Last but not least, the team headed to China, where chapter by hosted g, meetin r chapte Kong Hong the at presented of HBC CEO and COP Yuen, Sidney chair and COP authorized trainer, limited. ed chapter Thanks to everyone in Europe and Asia who attend r events. partne IAOP’s and IAOP rt suppo to out meetings and came it in Summ rcing Outsou Next stop — The 2011 Latin American there! you see to Hope 26-27. May Cartagena, Colombia on For more information on The Outsourcing Hall of Fame,
Participants in Pune, India enjoy the evening’s reception.
Yuen, COP, (far right) greets gue Hong Kong chapter chair, Sidney before addressing the audience.
Find Talent or a Career at BestOutsourcingJobs.com Organizations seeking the best outsourcing talent, as well as professionals looking for employment opportunities can benefit from this IAOP member service provided through BestOutsourcingJobs.com. BestOutsourcingJobs.com aims to help customers source and hire the most qualified outsourcing professionals and to provide those professionals with the best job opportunities in their respective fields.
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