Stats on BPO from Capgemini and IDC

I just attended a day of the IDC Outsourcing Forum, which took place in San Francisco earlier this week. Excellent roster of speakers. The topic focused on BPO — primarily human resources-related for the talks I sat through. But the advice I gleaned, which I'll share over the next week, is applicable to all kinds of outsourcing, including IT.

The event probably had about 140-150 participants, including vendors. It's too bad there weren't more delegates there. One would think the Bay area would be filled with people who need to get their arms around how to do this stuff right. After all, if you had the right job title, you'd qualify for a free pass.

Capgemini and IDC performed a survey there among attendees. Here are some of the more interesting results:

The top four drivers for a company deciding to use BPO in their corporate strategy today, in order of importance, are: cost reduction, focus on core competencies; improve performance and quality of service and cost avoidance (replacing technology/ upgrades). So, cost is still at the of the list (no matter how many consulting firms say otherwise), but there are plenty of other reasons companies are looking to an outsourcing model to get their work done.

About 32% of participants said they've outsourced some IT functions. About 27% said they've outsourced their HR functions.

The biggest challenges they've faced are inadequate change management strategy (27%) and management resistance (24%).

During vendor selection, cost didn't rank first:

  • Cultural fit with a provider, 33%
  • Ability to offer transformation service plus operate capability, 30%
  • Lowest cost, 19%

Almost 40% of respondents believed that governance procedures were the most important legal issues facing BPO today. Business continuity (23%) and intellectual property rights (20%) were named as the next issues of importance.

The press release I read said you can view the complete survey results on the Capgemini site, but I couldn't find them there.

However, you can learn about the East Coast version of the IDC event, which takes place April 18-19 in New York, here. Scrounge around on some of IDG's magazine sites (such as CIO.com) to watch for qualified attendance promotions, which can get you in the door free.