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Entries Tagged as 'Business outsourcing'

Rules of Thumb for Effective business process outsourcing (BPO) Contracting

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Developing an effective BPO contract has several basic rules of thumb. First, everyone involved in the contracting process should keep in mind the nature of the BPO relationship. The alignment of the long-term strategic interests of both the BPO buyer and vendor should be reflected in the terms of the contract. Second, it is important [...]

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The business process outsourcing (BPO) project management plan

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The formal contract between BPO buyer and vendor has been signed and sealed. The BPO contract is a detailed document that includes service level agreements that specify the level of expected performance on defined organizational processes. These form the basis for developing metrics and for the system of rewards, penalties, and remedies that govern the [...]

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Negotiating business process outsourcing (BPO) agreements

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Because of the complex and evolving nature of the outsourcing process, negotiation of BPO agreements requires a different mindset than that required in traditional commercial contract negotiation. Outsourcing is by definition a collaborative effort, rather than a zero-sum game. Zero-sum negotiating means that each party is motivated to extract as much value as possible from [...]

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Identify and select a business process outsourcing (BPO) vendor

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Finding the right BPO vendor is a critical step in an organization’s outsourcing initiative and one at the most difficult to manage. The promise of BPO is always tempered by the perceived risks associated with handing responsibility for an internal business process-no matter how noncore or mundane it may be-to another firm. More than one [...]

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Identifying and selecting the right outsourcing partner

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Step 1. Appoint a vendor selection team (VST) There is far more to choosing an outsourcing vendor than there is to choosing a new supplier. Unlike the buyer-supplier relationship, the business process outsourcing (BPO) buyer-vendor relationship involves a customized service, detailed agreement on service levels, and a strategically oriented long-term contract. Given our contention that [...]

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Strategic costs associated with business process outsourcing (BPO)

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The strategic costs associated with BPO are centered on the potential loss of organizational learning that results from moving a process under the control of an external service provider. Competitive advantage in most industries today is a moving target, and firms must seek it whenever they can. In some cases, competitive advantage arises in unexpected [...]

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Identify and select a business process outsourcing (BPO) vendor

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Finding the right BPO vendor is a critical step in an organization’s outsourcing initiative and one at the most difficult to manage. The promise of BPO is always tempered by the perceived risks associated with handing responsibility for an internal business process-no matter how noncore or mundane it may be-to another firm. More than one [...]

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Financial costs associated with business process outsourcing (BPO)

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The financial costs associated with BPO are ongoing, as long as the project is active. Each project phase has predictable costs that can be forecasted, budgeted, monitored, and mitigated. In addition to these phase-specific direct project costs, each BPO initiative has a variety of less obvious yet insidious hidden costs. Project managers will do well [...]

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Identify and Select the business process outsourcing (BPO) Opportunity

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No sensible decision can be made any longer without taking into account not only the world as it is, hut the world as it will be . . . BPO is not right ton every company, nor is it right for every process in a given company, but its promise makes it imperative that managers [...]

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Cost management model for a standard business process outsourcing (BPO) project

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Total Cost Management (TCM) is a term used to refer to the process of identifying, forecasting, and developing mitigating tactics for costs associated with a project. Individuals familiar with the initiation and implementation of information technology (IT) projects will recognize that this concept is similar to the Total Cost of Ownership (TCO) approach used for [...]

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