Managing Business Process Outsourcing
NMIMS Solution June 2020
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Q1. With the help of an example explain the lifecycle methodology for Business Process Outsourcing.
Q2. With the help of an organization that outsource it business processes, explain the benefits of Business Process Outsourcing and what are some of the risk/challenges faced in Business Process Outsourcing?
Q3. The rise of what is known as business-process outsourcing (BPO) in the Philippines has been nothing short of phenomenal. The very first calls were taken in 1997; today the sector employs 638,000 people and enjoys revenues of $11 billion, about 5% of the country’s GDP. Last year the Philippines even overtook India, long the biggest call-center operator in the world, in “voice-related services”. The country now employs about 400,000 people at call centers, India only 350,000. The main reason for the success of the Philippine call centres is that workers speak English with a neutral accent and are familiar with American idioms—which is exactly what their American customers want. Of these, many have taken to complaining bitterly about Indian accents (which no amount of “voice neutralization” coaching seems to have overcome). As a result, the Indian firms themselves have been helping to move jobs to the Philippines by setting up call centres in Manila and other parts of the country. Infosys and Wipro, as well as scores of other Indian firms, now have substantial operations there. And they aren’t drawn to Manila by cheap labour. Wages in the Philippines are slightly higher than in India since the Filipino accent commands a premium. It also helps that the country has a big pool of well-educated workers. The million or so Filipinos who graduate every year have few other options to choose from, besides emigrating. And working in a call centre is considered a middle-class job (new recruits start at $470 a month). The big question is whether the Philippine BPO industry, having conquered the call-center market, can now move up the value chain. To keep growing rapidly—and profitably—it needs to capture some of the more sophisticated back-office jobs, such as those processing insurance claims and conducting due diligence. In these businesses, called knowledge-process outsourcing and legal-process outsourcing, India still rules supreme.
(Source: The Economist: http://www.economist.com/node/21557350)
Based on the article, answer the following questions:
- Compare and contrast the BPO industry in India as well as the Philippines and summarize the findings in terms of future of BPO in both the countries. (5 Marks)
- Looking at the scenario, it’s clear that other countries like China and Philippines have great potential to beat India in the BPO industry. What can India do to maintain its leadership for the same? (5 Marks)