Dennis Byron in another blog, raises and discusses well, the differences between Business Process Management (BPM) and Business Process Outsourcing (BPO).
http://www.bpminaction.com/blog/2008/10/bpm_in_bpo_what_business_proce_1.php
In our company, we work closely with many Business Process Outsourcing companies, especially Offshore companies. I have observed a lot of specifics about what and how BPO vendors handle BPMor parts of it!
Dennis is absolutely right in the first place saying that BPO usually involves processes that have a lot of manual aspects to it!
What we found in our interactions with our company's customers are the following:
a. Many BPO providers execute parts of a business process even when other parts are automated. Wherever manual document checking or calling people on the phone and getting or checking information is involved, it is outsourced and in many cases, offshored. For example, there might be a totally automated system for new Insurance policy underwriting. However iin some cases, they may need additional medical information. This may involve calling people, getting information in scanned form and entering this into the system. Thereafter again, Rule based underwriting may automate the rest of the process!
b. In many cases, many processes are still highly manual with no BPM or automated systems doing anything. In these cases, processes are being documented for the first time in their life! Outsourcing service providers have to do this because of legal contracts involving what needs to be provided as a service. This can form the basis for BPM application later on!
c. Unlike what people imagine, BPO service providers like GE units in India are much more savvy in Six Sigma and Process Improvement techniques than even their customers. GE units whereever they are in the world, insist upon managers becoming Six Sigma Black Belts as early as possible. So you have a funny situation where Black Belts are available but do not have visibility into the full process!
d. There is a lot of measurement and reporting going on in the BPO context even if nothing happens in the context of the full process! This is because Outsourcing to an external party will involve a contract and putting down some specific paramaters for performance measurements. For example, if it is a Call center process they may need to specify Average Handle Time (AHT) etc as the Service Level Agreement (SLA) parameter.
Many interesting things happening in the intersection of BPM and BPO. Good thing that Dennis brought them up!
If you work at the parts the whole will be a success - Anonymous
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