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Accenture and the London School of Economics have uncovered the “keys to the kingdom”—those practices that contribute to high-performance business process outsourcing (BPO). In this paper, we examine the practice of making change management a priority, one of the hallmarks of high performance.
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High Performance BPO: Eight Practices That Can Drive Long-Term, Differentiated Value from a BPO Relationship.
Read other articles in this series relating to the following practices:
As the BPO market matures, clients are expecting more than just cost reductions and fulfilled service level agreements. They want their back offices transformed, their business performance improved. They expect their service providers to adapt to changing business demands and deliver new sets of outcomes.
We call relationships that are achieving these exceptional results high-performance BPO.
Accenture and the London School of Economics undertook joint research to uncover the practices that distinguish high-performance BPO from its more typical counterparts. Our latest research uncovered the “keys to the kingdom” practices that contribute to high performance. These practices emerged from analysis of four principal research streams:
A comprehensive survey of 263 senior client BPO executives.
In-depth interviews with client-provider executive pairs in 20 organizations.
Research into 26 organizations identified as high performers in collaborative innovation.
A review of 1,356 BPO and ITO findings identified as robust from 254 academic research studies.
Our client interviews and survey both found that high-performance businesses are not only distinguished by their attitudes toward change management but also their ability to execute robust change management program. These organizations understand that change management needs to be considered in terms of two different perspectives: first, the immediate issues that they face while transitioning from their previous mode of operations to the new outsourcing environment; second, their ability to adapt to change in the long run.
Our research shows that there are four keys to transformational change management capabilities:
Executing change management plans during transition. The ability of a provider to come to the table with experience backed by proven transition methodologies is critically important.
Transformational leadership. Companies must have dedicated programs and incentives in place to develop the right leadership behaviors. Transformational leadership is especially important in keeping a BPO relationship energized and creating higher levels of value.
Managing dynamic objectives. High-performance BPO depends on remaining aligned with a client’s constantly changing global operating context. BPO leaders have dynamic objectives for their outsourcing relationships and find ways to leverage their management structures, processes, and relationships to deal with this dynamism.
Putting long-term change management initiatives in place. A key factor in the success of Accenture’s finance and accounting outsourcing deals with BP and Microsoft is long-term change management plans designed to raise the level of customer experience, expand scope, reduce operating costs and raise productivity levels.
Leaders from high-performance BPO relationships understand that enthusiasm at the top is vital in shaping the engagement, but does not trickle down automatically to the operational ranks.
Therefore, partners from these relationships couple ambitious transformational projects with aggressive change management programs. It is also important for the client’s business users—who may be scattered worldwide—to understand and embrace the outsourcing objectives. High-performance BPO clients communicate clearly and frequently to their business users and they and deploy their best people to transition and project teams.
High-performance BPOs not only place greater emphasis on change management, they are also vastly more successful in executing change management plans as compared to typical BPOs. These propositions— transformational leadership at all levels, change management design and execution capabilities—emerged forcefully from our research.
High-performance organizations appoint suppliers with strong change management capabilities, but clients jointly own the change process. As described in our companion paper, A Focus on Business Outcomes, these organizations also recognize that service objectives are constantly evolving towards business and strategic outcomes and they manage the relationship and achieve stakeholder alignment through frequent communication, effective resourcing, and political processes. The role of transformational leadership in all this is critical, and is therefore the subject of a detailed companion theme paper, Transformation of the Retained Organization.
December 10, 2012
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