From a customer's perspective, value includes direct or indirect impact on
the business like revenue and profitability. This includes, high-end initiatives
like redesigning underlying processes, customer data mining, statutory reporting
and inbound sales. The value chain is an ecosystem of several factors like
knowledge, market forces, skills, criticality, impact, and time.
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PV Kannan
Co-founder and CEO,
24/7 Customer |
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The value chain lies between the buyer needs-current and future-and
vendor's capability to satisfy them. Vendor's value addition stems from his
knowledge, delivery capabilities and resources-initiatives that exceed
customer's expectations of the process and bring him additional benefits. The
client values benefits that impact his business, and he agrees to pay for it.
The vendor then creates value as a new process for the client based on his
capabilities and client's requirements. Once this is achieved, the service
provider partners with the client to migrate this new process to bring in more
benefits. Value delivery models can be across multiple functions or processes,
or across a process by vertical or function. The BPO industry is getting more
and more knowledge based. This change has also positioned the Indian service
providers to assume a lead role in the drive to take customer experience to the
next level. Outsourcing projects are no longer executed with the offshore
partner taking the back seat. BPO outfits today, act as consultants and work
jointly with the clients to determine outsourcing opportunities, models,
knowledge transfer plans, critical to quality measures and other migration
essentials, demonstrating a clear shift in their role. Their demonstrated
expertise has allowed them complete control of the operating strategy, though
transparency is still desired. Activities considered for offshoring are moving
up the value chain and are touching core functions. The higher-end functions
being performed offshore these days include highly analytical processes,
information research, financial portfolio analysis, customer data mining,
statutory reporting, and inbound insurance sales, among others.
Among this emerging trend of value creation by service providers,
organizations have realized more benefits from offshoring. Today, at the client's
end, this value addition is key to service provider selection and management. At
the service provider's end it would call for identifying the appropriate value
delivery model, investments in innovation, and managing revenue impact of value.
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