The world of business process outsourcing (BPO), broadly defined, has undergone multiple incarnations. Pure facilities management preceded data and infrastructure outsourcing; thereafter came application support. We’ve now moved into a new era, however – that of business process support (BPS) – allowing an external partner to manage everything from finance, to HR, sales support, credit and collections, as well as digital marketing.
Local companies have been reluctant to rely on third-party delivery of key services – in many cases due to fears around loss of control, where there is a legacy thinking of ownership equalling control. That said, Nigeria has not been left untouched by traditional BPO – the application and IT areas have matured more rapidly over the past five years, nonetheless only one conglomerate has taken a bold BPO step in Nigeria. Going forward, however, as we begin to see major moves towards drivers such as As-a-Service, increased automation and artificial intelligence, for forward-thinking Nigerian companies, leapfrogging competitors is going to be all about taking advantage of those next-generation capabilities today.
A fundamental shift from BPO to BPS
Once, outsourcing meant taking as many people as possible and setting them up in a delivery centre. That is changing. A combination of the on-tap liquid workforce, robotics, access to industry expertise, cloud technology and artificial intelligence – that’s where the sphere is headed. Fixed costs are declining steeply; you now buy services as required. Digital is remaking outsourcing – ‘outsourcing’ as a term in fact is no longer accurate. It’s all about business process services and the way BPS enables more effective, intelligent decision making.
There are more exciting changes. Whereas cost reduction once lay at the core, the key driver is now business outcomes – selling more products, improving account usage and increasing revenue. Another relates to a mindset shift. A service such as finance or procurement – when managed by an external partner – is now no longer simply a back-office process. Analytics function becomes capable of shaping how a business thinks about itself. Utilizing an expert service provider means that those in both middle and upper management are free to think more strategically.
Ololade Raji went further, saying, “given the benefits, it’s hard to understand what’s been preventing companies in Nigeria from taking the plunge, although lingering fears around the ownership-control continuum may continue to play a key role. At first blush, it appears to some that loss of ownership of a function means loss of control over it. In fact, the converse is often true – particularly in the sense that a more arm’s-length relationship often results in better decision making. Interestingly, utilizing an expert provider like Accenture can give you greater control through deep expertise and a commercial arrangement giving committed performance and business outcomes”.
Crucially, having largely side-stepped the shared services model, Nigerian companies are now better positioned to take a ‘long-jump’ approach to BPS: moving straight from in-housed disparate functions to plugging directly into an expert partner’s value delivery machine. Many businesses in developed economies will, by contrast, have undergone a longer, ‘triple-jump’ process, having worked on a shared services basis in between, and endured the associated restructuring and upheaval.
The value of going direct
Ololade further stressed that, “companies in Nigeria will no doubt begin to increasingly realise the value and gains business process services enable – fixed costs decline as services are bought as needed; migration into cloud platforms powers both scalability and ease of access. The liquid workforce means high skill at reduced, flexible cost. Moreover, there are the benefits made possible not only by automation, but increasingly, by cognitive computing and artificial intelligence. The list goes on.”
As the drive around efficiency, flexibility and reactivity reshape the global business landscape, successful companies will need to realise operational efficiencies and access the strategic insights made possible by expert partners. It just so happens that Nigerian companies may be uniquely well positioned to do so.
Article By: Ololade Raji, Accenture FMCG, Operations in Nigeria