MODULE 4 BPO

Transition Management
A Transition Manager – is responsible for migrating the function or the process from the client location or organization
to the service provider or outsourcing organization.
The Transition Manager – needs to be an effective communicator, as the role requires extensive interaction with the
clients.
Lift and Sift
 This is the most common methodology used. When the process is mature, the “lift and shift” approach is used
for migrating.
 Means moving a matured process from its current organization to a service provider.
 Phases
1. Move the current process to the service provider without changes/improvements
2. Stabilize
3. Re-engineer the process to achieve efficiency gain- produce same output, less FTEs
 Items to consider
1. Process change will not affect process control points or output can be done by service provider
independently
2. Major effort: post go-live reengineering
 Advantages of an “asis” basis process migration:
 Training the new team is easier, as the process is well understood and documented
 Existing employees at the door location are available to support the process in case of disruption or
instability
 A fresh set of eyes look at the process from a fresh perspective, often resulting in process improvement and
enhanced controls.
Re-engineer and Migrate
 Fundamental rethinking and radically redesigning of the business process to achieve dramatic improvements in
critical measure of performance such as cost, service and speed.
 Unlike “lift and shift”, improvements or changes in the process to be outsourced are made before outsourcing it
to the service provider in this strategy.
 Items to Consider
 Useful when the process either broken and requires fixing, or is due to undergo significant change in the
near future.
 In such cases, it may be important to utilize the expertise of the existing team to drive the change, before it
is handed over to the new team.
 Company that outsource industry common processes to a market-leading service provider processes
 Company changes its processes as part of transition to service provider.
Transition Pitfalls and Risks
1. Inadequate investment and sponsorship
2. Unclear scope of work
3. Training shortcuts
4. Unclear responsibilities
5. Not retaining the experts
Any transition is in jeopardy if any of the five (5) occur:
 Inadequate investment and sponsorship – one scenario to illustrate this is a manufacturing company expecting
volume sales from an agency that provides manpower – the sales force, but fails to invest on proper equipment
to allow product demonstrations so potential buyers can freely experience or try out the products.
 Unclear scope of work – and unclear roles and responsibilities. These are without doubt, serious concerns that
can torpedo your efforts for a successful transition. A good solution is through proper documentation and
process mapping which we will be tackling later.
 Training shortcuts – As future leaders expected to develop people, be mindful of the following training
dimensions: Timing and duration, content and delivery, skills practice and learning evaluation.
 Not retaining the experts – having subject matter experts in a company gives many benefits.
Transition critical success factors
1. Technology readiness – state of readiness of the enabling hardware and software to support the ongoing
operations.
2. Manpower readiness – state of the readiness of the operating staff; hired, trained and skilled for the service
processes.
Transition Effectiveness
1. Financial Benefits
  It is important to quantify the real cost of the function before off-shoring and the cost of the offshore
team on an ongoing basis.
 Costs related to moving function to the new team should be tracked separately as project costs.
 Capturing these cost elements enables comparison of baseline costs with current costs, and provides an
accurate measurement of the saves.
2. Performance of the Team
 Primarily done by developing performance metrics
 Usually subject to testing phase to determine reasonability of the service measure – also known as the
baselining” period.
Document readiness
 Inputs are documented
 Processes are documented using the industry standard format and in complete detail
 Output. Interim/flash and final output are completely documented
 Communication channels for output to be explicitly defined
 Supervision. Onshore supervision points and what will be reviewed/checklist should be defined
Work-shadowing
 The term used for “lean-by-doing” activity of service provider personnel, generally done at the same location as
current company performer.
 Phases:
o Onshore personnel doing activity
o Guided service provider network
o Go-live

Readiness assessment
1. Adequately documented.
2. Correctly-sized in generic resources
3. Resource sizing already includes the right level of quality assurance and supervisory control
Hands-off
 Transfers of the output to a different performer, an approver, for the further action prior to continuation.
 Hands-offs, reason for:
1. Data enrichment. The other performer adds data to the transaction
2. Quality Assurance. The second performer is a checker
3. Control. Approval for the materiality and substance is done by a separate person
 Sufficiency of scale depends on the following:
 Service provider
- When a client considers a service provider, the client will look at its hardware, software, and people-
ware capabilities.
 Requirements of the job
- Requirements can be describe through; volume capacity of transactions, complexity of the job and
expected cycle-time for job completion. The final or ultimate judge to determine readiness of
hardware, software, and people-ware of the service provider is the client.
 Client
- The client can freely make decisions that will directly impact the service provider’s hardware,
software, and people-ware capabilities.
 Tips to optimize scale
o If the process to be outsourced is done by only a few FTEs, it is not worth outsourcing
o Near self-contained roles have good potential for outsourcing – because more FTEs covered
o End-to-end role are ideal
o Buyer needs sufficient FTEs in outsource projects to justify risk and executive attention
o What is the amount saved, if it is too small, the cost of onshore supervision eats up the benefit
o Service provider needs sufficient FTEs to justify a risk, supervisor, and overhead
o Training
o Improve Hardware and/or Enhance Software

Identifying task candidates for outsourcing

 Candidates Components of readiness
a) Finite
b) Documented
c) Sufficient of scale
  Considerations
- Readiness assessment
- Level of documentation of onshore processes
- Scale: sizing savings based on current performer count
- Time-tracking or task-based FTE assessment
- Prioritize roles that are “more ready”
- Lift-and-shift for less documented roles
- Cost of low outsourcing readiness

MODULE 5 BPO
Service Level Management (SLM) – is a regular and systematic review of service providers performance against the
agreements
Six Components of Operations management
 Performance Management
 Quality Monitoring and Analyzing
 Metrics and Reporting
 Productivity Monitoring and Control
 Professional Development
 Continuous Improvement Initiatives
Performance Management – is a systematic process by which an organization involves its employees, as individuals and
as members of a group, in improving the organizational effectiveness through the accomplishment of mission and goals.
Employee performance management includes:
 Planning work and setting expectations,
 Continually monitoring performance,
 Periodically rating performance in summary fashion
 Rewarding good performance
Metrics and Reporting
Meet Operational Budget
 Transaction volumes – projected sales exceeding the costs of goods
 Target Average Handle time – Less wait time taking customers’ orders to accommodate more orders
 Cost per seat/hour/transaction – accommodating more customers to gain more sales
Reduce Waiting Time
Reduce Repeat Transactions
Increase Responsive
Increase Lead Generation
Limitations of Service Level Agreement (SLA)
 Lack of end customer focus
 Lack of emphasis on business objectives
 Over emphasis on efficiency rather than on effectiveness
 Lack of sub-process metrics to ensure consistency
Professional Development
Professional Development - refers to skills and knowledge attained for both personal development and career
advancement.
Value – lifelong learning, a sense of moral obligation, to maintain and improve professional competence, enhance career
progression, keep abreast of new technology and practice, or to comply with professional regulatory organizations.
Approach to Personal Development:
 Case study method
 Coaching
 Communities of practice
 Lesson study
 Mentoring
 Reflective supervision
 Technical assistance
Quality Monitoring and Analyzing
Quality Specification:
 Total Quality Management (TQM) – is a management system or approach to long-term success through
customer satisfaction.
Primary Elements of TQM:
o Customer Focus
o Total employee involvement
o Process-centered
 o Integrated system
o Strategic and systematic approach
o Fact-based decision-making
o Communication
Below are ways on how we can look at each component:
 Case Study – an approach that consists in presenting the students with a case and putting them in a
role of a decision maker facing a problem.
 Consultation – to assist an individual or group of individuals to clarify and address immediate
concerns by following a systematic problem-solving process.
 Coaching –enhances a person’s competencies in a specific skill area by providing a process of
observation, reflection, and action.
 Communities of Practice – to improve professional practice by engaging in shared inquiry and
learning with people who have a common goal
 Lesson Study – to promote an individual’s awareness and refinement of his or her own professional
development by providing and recommending structured opportunities for reflection and
observation
 Reflective Supervision – to support, develop, and ultimately evaluate the performance of
employees through a process of inquiry that encourages their understanding and articulation of the
rationale for their own practices.
 Technical Assistance – to assist individuals and their organization to improve by offering resources
and information, supporting networking and change efforts.
 Total Quality Circles (TQC)
- It means having organized kaizen activities, involving everyone in a company – managers and
workers – in a totally systemic and integrated effort improving performance at every level
- It is to lead to increased customer satisfaction through satisfying such corporate cross-functional
goals as quality, cost, scheduling, manpower development, and new product development.
 ISO 9001
- A very flexible quality standard that is readily applicable to many industries, as well as to all
sectors of IT-BPM industry, hence its popularity in the Philippines even with small-scale
business.
- ISO 9001 is part of series of International Standards for Quality Systems, it is primarily focused
on quality systems as models for quality assurance in design/development, production,
installation and servicing
 Six Sigma
- A set of qualitative and quantitative techniques to systematically improve processes by
eliminating defects process variation.
- It is byproduct of decades of quality improvement methodologies such as Statistical Process
Control (SPC), Total Quality Management (TQM), and Zero Defects.
Six Sigma asserts that:
 Process variation is an obstacle to reliably delivering high quality products and services, as
defined by the customer,
 Continual focus on reducing process variation is the foundation for business improvement and
success,
 All business processes can be measured analyzed, controlled and improved management
 Effective problem solving can only be achieved by data driven decision making, and;
 Achieving and maintaining quality improvement requires an organizational commitment that
come from senior management
Productivity Monitoring and control
Employee Productivity
The amount of outputs which can be produced by employee per period of time, utilizing the given resources. The more
stable and elaborated the process of production, the smoother level of productivity is expected from employees
operating it.
Guideline for monitoring Employee Productivity:
o Measuring
o Comparison
o Identification
o Feedback
Continuous Improvement Initiatives
5S Process – or more simply “5S”, is a structured program to systematically achieve total organization, cleanliness,
and standardization in the workplace.
Benefits:
  Improve safety
 Decrease down time
 Raise employee morale
 Identify problems more quickly
 Develop control through visibility
Seiri. (Tidiness) Throw away all rubbish and unrelated materials
Seiton. (Orderliness) Set everything in its proper place for quick retrieval and storage
Seiso. (Cleanliness) Clean the workplace; everyone should be a janitor
Seiketsu. (Standardize) Standardize the way of maintaining cleanliness
Shitsuke. (Discipline) Practice “Five S” daily, make it a way of life; this also means commitment
Kaizen:
 It is a Japanese management concept for incremental change
 It is a way of life – a philosophy, assuming that every aspect of our life deserve to be constantly improved
 Kai means Change and Zen means good
Key Elements of Kaizen:
 Quality
 Effort
 Involvement
 Willingness to change
 Communication
Lean
 A process management framework and methodology derived mostly from the Toyota Production System (TPS).
It aims to optimize the flow or speed of producing goods and services by removing the traditional “8 deadly
wastes”.
 Lean implementation leverages tools for assessing process flow and delay at every step in a process. The focus is
on separating value-added from non-value added activities and eliminating the root causes and cost of the non-
valued activities. Lean methods are sued to quantify and eliminate the cost of complexity.
 Lean focuses on driving quality by eliminating the wastes or by using less resource.
8 Deadly Wastes:
 Overproduction
 Transportation
 Motion
 Correction
 Inventory
 Waiting
 Unused employee ideas and talent
*IT-BPM success largely depends on how effectively the organization is in managing its operations.
Business Process Mapping and Notation
Definition
 Business Process Mapping and Notation (BPMN): “standard notation readily understandable by all business
stakeholders”
 Crafted business analysts
 Reviewed by business managers and performers who will manage and execute the processes
 Implemented by technical developers

Event Start, intermediate, end events

Activity Task, subprocess

Gateway Forking (decision) or merging of paths

Flow Sequence flow

Data Input data, output data

Group of tasks used to visually designate a group of tasks

t Annotation Comments
 Pool or Lane Scope of the role of a performer, hand-offs to other performers/units
are shown as arrows going out of the lanes

MODULE 6 BPO
Business Continuity Management
 The challenge to business continuity management is to plan for seemingly “uncontrolled” circumstances to
provide for consistent excellent service
 The goal of business continuity management is maintaining the uninterrupted availability of all key business
resources required to support essential business activities.
Goal of Business Continuity Management is most evident in the following:
 Uninterrupted availability – continue business operations
 Key business resources – ensuring business capability
 Essential business activities – key business goals
Business Continuity Management Interruption Events
 Each process has a period within which interruptions will not affect achievement of key business goal
 Beyond that period, business goal will be impacted – and interruption becomes extraordinary
 Business Interruption Event is triggered when the interruption on a key business process exceeds the
maximum allowable time.
Business Continuity Management Triggering Events
1. Extraordinary event – beyond normal downtimes of equipment or input process errors
2. High impact – resulting in risk of significant loss
ANAO (Australian National Audit Office) uses the term “outage”
Business Continuity Management Reduce Probability of Occurrence
 Develop measures to prevent risk from occurring – if within the control of the organization
 If cost effective – shifting of factory to an underground bunker to protect from tornado damage may be cost
prohibitive
 Reduce likelihood of the risk if prevention is impossible or not cost effective – extensive smoke alarms to
catch possible fire starts; good quality circuit breakers, periodic inspection and replacement, use of standard
wires/tapes reduce risk of electrical fire; multiple generator sets reduce risk of interruption from power
failure
Critical Situations in the IT-BPM Industry
Definition:
 Critical situation (Critsit) in the IT-BPM in the IT-BPM is when your ability to render consistent excellent services
has been compromised.
 An organizational state where symptoms of service quality and operations management degradation is
becoming apparent in the delivery of services.
 “Critsit” is industry jargon or terminology for critical situation.
Critical Situations in the IT-BPM Industry: Entering into
 A state of being on the verge of crisis or emergency that if not addressed could lead to an elevated risk level.
 A Critsit is no ordinary exercise and it should only be declared once a defined set of criteria has been determined
by the senior management.
Critical Situations in the IT-BPM Industry: Declaration
 The Critsit should be jointly declared by the following:
 Delivery Center Leader or General Manager
 Competency Leader or Delivery Process Leader
 Delivery Center or Competency/Process Quality Leader
Critical Situations Management Method

Prepare Assess Develop Gain Execute Close the

Recovery Commit- the Plan Recovery
Plan ment

The 8D Approach – Problem Solving/Issue Resolution

Definition:

 The Eight Disciplines or 8Ds is a Ford Motor Company method to resolve a problem when the cause of the
problem is unknown.
 The 8D is at one time three different things that work together, these are: a problem-solving process, a standard
and a reporting format.

The 8D Approach:

Discipline 0 – Become aware of the problem

Discipline 1 – Use team Approach
Discipline 2 – Describe the Problem
Discipline 3 – Implement and Verify an Interim Containment action
Discipline 4 – Define and Verify Root Causes
Discipline 5 – Choose and verify corrective Actions
Discipline 6 – Implement Permanent Corrective Actions
Discipline 7 – Prevent Recurrence
Discipline 8 – Congratulate Team

Managing Issues & Changes: Issue Management Processes

1. Facilitated Communication and Tracking
2. Root-cause Analysis
3. Escalation
4. Process Improvement or One-Off
Managing Issues & Changes: Communication and Tracking
 Communication of issues, particularly time sensitive matters, can be done verbally or by email
 But proper documentation by way of an issue management system is key to: structured resolution and
recurrence prevention
 Clear documentation of issue is key to effective escalation
Managing Issues & Changes: System Facilitates
1. Clear documentation – clear statement of issue, scope affected, root cause, proposed solution, financial impact
of the proposed solution and timetable.
2. Accountability for issue resolution – clear assignment of responsible persons
3. Approvals – facilitates approval by right authority in service provider and onshore/client organization
4. Process improvement – can identify changes in people skill/training, staffing level, technology, or
policy/processes.