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The BPO Tipping Point: Pointing to the Long-Term Value

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If Malcolm Gladwell is right that almost everything has its tipping point, then we will probably look back on 2006-2007 as the tipping point for business process offshoring (BPO).

From our perspective, what had been a slow, sometimes tentative unfolding seems to have morphed quickly into a fast-spreading trend. We believe we are seeing what Gladwell calls, “the moment on the graph when the line starts to shoot straight upwards.”

For BPO, that line will entail both a precedent and the unprecedented.

The precedent is ITO — information technology offshoring, the massive shift of software development jobs to other countries that paved the way for BPO. ITO, too, began as a lightly discernible trend that gathered strength as it delivered benefits and then spiked upwards as processes were perfected.

The unprecedented is more complicated and deserves the closest attention of all those involved in driving today’s BPO trend upwards. Despite the momentous gains in BPO, we believe that many of today’s successful BPO operations could contain within themselves the seeds for their eventual obsolescence. Unless offshorers fully recognize that the keys to a successful long-term offshore operation differ greatly from the keys to short-term gains, they risk the failure of their offshoring strategies.

As head of a BPO company for banks, it has been my job to talk to bank executives about their offshoring strategies.

Recently I have encountered a definite change in market attitude. Before, when I would meet with bankers, my topic was not the most desirable or highest priority topic for them. Offshoring was a highly charged subject politically and socially. Some felt threatened career-wise. Others were simply skeptical.

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By: Trestle Group


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