Blogs - Research and Analytics Services Outsourcing
| Four Tenets for Selling KPO to Your C-Level |
| By Alok Verma on 6/8/2010 2:08:20 AM |
"We have about 1500 business analysts in our organization, spread across 25 or more countries around the globe. These analysts work with their respective business units or individual departments to help with their data analysis needs. The problem is everyone works in siloes ─ seldom talking to each other, let alone sharing best practices or common methodologies. I have often tried to impress upon our corporate leadership the importance of consolidating this fragmented set of common skills to derive greater leverage, but to little impact," rued a client of mine who is a part of the global sourcing team at a leading consumer electronics company.
It was a no-brainer that his topmost challenge was bringing the siloed skills together to ensure that the organization truly leveraged the power of research and analysis. And, I realized that this was a problem agnostic to the size of an organization. As we discussed further, I shared with him a few ways in which he could possibly sell the concept of consolidation and then, outsourcing it. Over my years of experience working for a KPO, interacting with sourcing managers and research organizations, I have come to realize that there are four core tenets to selling a KPO engagement to your senior management.
a. Positioning the engagement as a revenue-enhancement exercise: Outsourcing has largely been restricted to IT or HR or finance and accounting but outsourcing analytics is still not the easiest of propositions to sell, despite the immense proven benefits it offers. So, brace yourself to go through a series of discussions before you can convince your C-level about the importance of a KPO engagement. Begin by positioning this as a revenue-enhancement exercise in your strategy sessions. It’s imperative for any corporate leadership team to drive efficiencies in processes that will have revenue-maximizing potential and not just cost-optimization. Position what a KPO engagement can bring to the table in terms of revenue enhancement: Better understanding of customer patterns; improvements in effectiveness in the sales and marketing functions; and cost efficiency. So talk the 'value talk'!
b. Providing a smart business case logic: Having won the crucial debate on the need to include KPO in the overall outsourcing mandate, your next task is to address the ‘business case logic’ ─ the possible stumbling block during the course of internal discussions. You could begin with the low-hanging fruits of MIS and reporting. On one hand, these will help your providers understand your data sets better, while on the other, your organization will build a greater appetite for outsourcing research and analytics projects.
c: Driving acceptance through Business Unit (BU) enablement: A journey well-begun may be half-way to the goal post, but it needs to be given the right momentum from time-to-time to live up to the initial promise. As a sourcing leader, you can tackle initial resistance and organizational barriers by empowering business units with innovative strategies like Seed Budgets. [Seed budgets are investments made in a pilot KPO engagement to evaluate the benefits.] You can choose areas where the business is either slack or saddled with issues of revenue generation. You can drive acceptance further by focusing on a few aspects of how business will be impacted with a KPO engagement ─ access to research and actionable analytics, which will drive superior decision-making; innovating or sourcing cutting-edge techniques, which will cater to unique business needs; and consolidating siloed data across the organization to create information repositories, which will drive strategic decision-making.
d: Ensuring a holistic perspective: A KPO engagement in one of the lines of business in an organization will reap quantifiable benefits. However, if enabled across the organization, the engagement can lead to a quantum jump. I’ve seen several examples of this, but ‘am detailing one of our clients, a leading fortune 500 company with global operations that has exhibited most of the tenets outlined above to set up a program that can truly be called a Center of Excellence. It’s an example, which began with the client CEO’s buy-in, and his efforts to push adoption. The engagement started with the areas of MIS and reporting, with a 10-member team wherein we combined various data sources (soon it scaled up to provide standardized MIS and reporting across various European geographies and business units leading to superior decision-making). The program, which began with one area, now supports several cross-functional teams like business Intelligence, global research and development, pricing, competitive intelligence, market research, forecasting and sales force effectiveness.
Selling KPO to your C-level may seem more of an art than science. I will be taking up each one of the above-mentioned tenets individually in the rest of the series on how you can make a KPO engagement an integral part of your strategic outsourcing mandate. I'd love to hear about your thoughts on KPO, and if you are already outsourcing, then write to us about the initial challenges you faced positioning the mandate and what has worked for you . So send your suggestions now!
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