Technology is enabling business process outsourcing (BPO) operations to move beyond process improvements and increase client business performance. Supply chain BPO services have great potential to transform clients by bridging the distance between front and back office supply chain processes. Supply chain visibility dashboards in particular can enhance collaboration between clients and BPO vendors to optimize global supply chains in real time. These dashboards may provide benefits such as improved supply chain management in an outsourced environment.

1. Inside: 6 Thought Papers
BPO Future Forward
Technology the “New Normal”- Enabling Businesses
www.infosys.com/bpo
1

2. 2

3. Index
INDEX
1. Social Networking in Customer Care Centers 7 - 11
2. The death of distance in Supply Chain 12 - 15
3. Designing an Optimal Technology Landscape – For 16 - 21
Accounts Payable Transformation
4. Special Tools for Special Purposes – Addressing the 22 - 27
Sourcing & Procurement Challenges
5. Winning the Red Queen’s Race – Redoing the math of 28 - 32
value creation for Communication Service Providers
6. Dealing with the “New Normal” in Finance Operations 33 - 39
3

4. 4

5. F o r e w o r d
Dear Reader,
Organizations around the globe are continuing to grapple with one of the most
challenging business environments. The increasingly rapid pace of technological
change has made technology the business enabler providing us with opportunities
to innovate, progress into newer markets and develop newer customer centric products
and services.
Businesses need to connect use of technology to their business strategy to focus on
trimming excesses, to focus on their core strengths and get to know how technology
can enable and drive value to their businesses.
It gives me immense pleasure to present to you the 4th edition of the Infosys BPO
Journal which has Technology the “New Normal”- Enabling Businesses as its central
theme, and brings views from a global strategic advisory firm and Infosys subject
matter experts.
This Journal articulates strategies and solutions to multiple industries by thought
leaders. This includes areas such as emphasizing the importance of designing an
optimal technology landscape to transform the account payable function within
organizations. It also focuses on implementing Special Tools which could address
sourcing & procurement challenges and how technology can trigger the death of
distance in the supply chain. We also focus on redoing the math of value creation for
Communication Service Providers, and adopting Social Networking to facilitate
collaboration in customer service centers and transforming it into a training platform
to increase its efficiency.
I would like to thank The Hackett Group and all the authors for their contribution to
this edition of the Journal.
I welcome your feedback on this edition at BPO_Marketing@infosys.com
I wish you all a very happy and prosperous New Year.
Best regards,
Ritesh Idnani
Head of Worldwide Sales and Marketing
5

6. 6

7. Social Networking in Customer Care Centers
Rajesh Cheeyancheri
Social Networking can be adopted by a Customer Care Center to facilitate
collaboration. By capitalizing on Social Networking, the Customer Care Center can
be transformed into an informal learning platform that enables traditional training
and informative sessions. Team members can benefit from knowledge sharing and
collaboration leading to increased levels of efficiency at the Customer Care Center.
7

8. Addressing Challenges of Customer Care standardized processes for their day-to-day operations.
Centers In a Customer Care Center, human capital is a critical resource
Companies are focusing on customer service to differentiate - agents/advisors, team leaders and floor walkers work
themselves, ensure customer loyalty and retention, compete towards a common goal. Human capital can be empowered
effectively and remain profitable. As products and services by applying the underlying concepts of Social Networking
become more complex and sophisticated, providing customer such as forming teams or groups to share experiences. For
support becomes challenging. For instance, resolving a example, when an advisor discusses with his/her peers how
problem for IPTV service, a next generation television service they handled an irate customer, it offers options to manage
offered by telecom companies, is far more complex than similar situations in the future.
resolving an Internet service issue. Such a collaboration at an advisor level helps improve the
Companies must innovate and launch new products or overall skill level of its staff and creates a more informed
services faster to ensure consistent revenue and growth. As and empowered organization. In addition to the formal
the shelf life of these products and services reduce, Customer training and awareness sessions, collaboration enables
Care Centers have to re-train their staff more frequently to knowledge sharing obtained through hands-on experience,
handle new services. Since these Customer Care Centers which will otherwise remain confined with the individual.
are located in multiple geographies, the cost and logistics When collaboration gathers momentum and attains critical
associated with training is daunting. mass, it can become a rich repository of data which can be
analyzed to identify the areas of improvement or emerging
In a majority of industries, a technology monopoly is
trends.
redundant. The gap between the market leader and the
followers is slim because technologies/skills are easily For advisors, it provides an opportunity to transcend routine
adopted. Consequently, companies have to find a distinctive case handling and encourages them to take ownership in
value proposition to sell their products. Packaging extended their work. It offers a platform to showcase their work and
warranties and selling premium after-sales services with a helps them build a repertoire of case handling skills that is
product have now become a common practice. Customers, not always imparted in training. As clients and counterparts
who buy these additional services, demand that their are located in different geographies and have different ways
problems are resolved promptly and efficiently. Customer of talking and writing, a forum to view anecdotes of advisors
Care Centers need to innovate to address these challenges. is useful to understand the nuances, conversational styles
and cultural cues embedded in a conversation. Such skills
cannot be imparted in classroom training or through
Bridging Social Networking with the Customer documentation.
Care Center
Social Networking and Customer Care Center are very
Integrating Social Networking into the
different concepts.
Customer Care Center
Social Networking is becoming increasingly popular because
A Customer Care Center works in a gated mode - advisors
it is associated with individual lifestyles and caters to the
have access only to a pre-defined set of resources (tools,
individual's personal activities. It works in a relaxed
people, applications, etc). The mode of operations is defined
environment with no real deliverables or accountability.
by factors such as the business model, data protection,
In contrast, a Customer Care Center is a highly reactive and operational efficiency, etc. These factors must be taken into
time-bound environment - the clock starts to tick as soon as consideration when introducing concepts of Social
a customer calls and stops when the customer ends the Networking in a Customer Care Center.
conversation. The efficiency of a Customer Care Center
operation is constantly evaluated and enhanced using a System Generated User Modified Content (SGUMC)
number of Key Performance Indicators (KPIs). To meet these A fault, case or ticket is the entity around which the whole
goals, Customer Care Centers comply with pre-defined Customer Care Center operates. When a customer calls the
8

9. Customer Care Center to resolve a problem, it begins with Public Sharing Space
the creation of a 'fault', a 'case'or a 'ticket'by the CRM Every SGUMC created in the Customer Care Center will be
application. In its lifetime, the fault is attended to by various stored in a Public Sharing Space. The SGUMCs created by
people with a sole objective - close it at the earliest. Once a advisors are a good source of information for anyone involved
fault is closed, for all practical purposes, it just becomes a with the Customer Care Center. For example, new recruits
quantitative parameter in the different metrics generated can use it to get up to speed on their work. Similarly, training
by the Customer Care Center. Invariably, the qualitative teams can use it to examine any area which requires attention.
aspects are not captured anywhere.
The System Generated User Modified Content (SGUMC) is
an entity envisaged to capture the qualitative aspects when SGUMC in Action
an advisor at the Customer Care Center works on a case.
Let us evaluate three potential SGUMCs and how they
The SGUMC entity will have its origin in a system generated
interact with different actors:
fault, case or ticket that can be modified by advisors at the
Customer Care Center to record their observations, analysis, 1. DreamCase
comments and anecdotes. Once created, SGUMCs can be 2. NightmareCase
shared and exchanged among advisors. 3. Case2Watch
Advisors and Budadvisors DreamCase
Any agent or advisor at the Customer Care Center can Every advisor will have cases that worked perfectly. These
participate in such a collaborative environment. Just as in cases can be self-motivating and provide a 'feel-good' factor
any social networking environment, advisors can form groups when one looks back at the work. If an advisor feels that the
and communities. A budadvisor is an advisor who shares a case proceeded well, it may be worthwhile sharing it with
special relationship with another advisor. For example, if buddies. The benefits are two-fold: 1- More people get to
Ted is a budadvisor of Pal, Ted can comment/update Pal's see a case handling they probably can emulate and 2- It
SGUMC. Advisors select which advisor can become their validates the advisor's case handling with his/her peers. It
budadvisor. can also lead to 'bragging' in Social Networking parlance.
Step 1 Step 2
Cases Become Budadvisors
Budadvisor Budadvisor
Advisors
Budadvisor at the
Center
Share it with
User
User
Budadvisors,
Exchange comments
DreamCase NightMare
Submit SGUMC to Access SGUMC from
Public Sharing Space Public Sharing Space
DreamCase NightMare
SGUMC
Public Sharing Space
Step 1: Create SGUMC Step 2: Share SGUMC with the various Actors
Figure 1: Creating and Sharing DreamCase and NightmareCase SGUMCs
9

10. An advisor can selectively build his/hers DreamCase SGUMC In fact, NightmareCases will attract more discussion and
and share it with the advisor community. When a DreamCase comments than a DreamCase.
is created, it can lead to different situations:
• The advisor can share it with his/her existing Case2Watch
budadvisor. The budadvisors can comment on the Today, services delivered to the end user are complex and
cases or begin discussions around it. One interesting involve multiple organizations and applications. Typically,
use of the DreamCase can be to use it in training or services have numerous components and a long supply chain
team huddles where the participants can use it as a spanning different geographies linked together by business
case study and discuss it. and service level agreements.
• The DreamCase SGUMC can also be directed to a Public For an advisor who is one of the links in the supply chain,
Sharing Space. Every registered user can access the the ability to know the status of the case after it had been
Public Sharing Space and view the DreamCase. Based handed over to another organization can be helpful. It can
on the DreamCases, advisors may want to become a be particularly useful for advisors who are closest to the
budadvisor to the author of a particular DreamCase. end customer to ensure that the case is acted upon and not
For example, if a Advisor-Z is handling a particular parked somewhere. In addition, it expands the horizon of
customer and sees another Advisor-Y having a lot of the advisor to understand and appreciate the challenges of
DreamCases around that customer, Advisor-Z can other organizations that are all part of the supply chain.
become Advisor-Y's budadvisor.
The above situation can be resolved by Case2Watch, the
SGUMC created by an advisor which will be updated as
NightmareCase
the case progresses. Another advisor who is interested in
On the one hand, advisors work on DreamCases, on the other,
a particular case can subscribe to a Case2Watch for
they have NightmareCases. While most people wish to forget
updates or to participate in a discussion around that
a nightmare experience, these cases provide important
Case2Watch.
lessons for the individual and the Customer Care Center. It
is important to share these experiences with peers. They Social Networking in a Customer Care Center can facilitate
may relate to behavioral skills in handling a particular collaboration in a highly reactive environment. For the
customer or a complicated technical issue that made the Customer Care Center, it is an informal learning platform
case very difficult. that enables traditional training and informative sessions.
Step 1 Step 2
Cases
Subscribe and
Case2Watch get updates
User about the
User Case2Watch
Update the SGUMC
Case2Watch
Case2Watch
SGUMC
Step 1: Create SGUMC Step 2: Share SGUMC with the various Actors
Figure 2: Case2Watch
10

11. The challenges presented by the nature of Social Networking • The SGUMC to be a good source of data that can
and Customer Care Center must be considered before provide insights into a number of parameters from an
building an application to realize collaboration. For example, advisor's perspective. Quality teams can use it for
productivity and handling times are some of the key KPIs of analysis related to productivity and efficiency.
a Customer Care Center that are not relevant in the context
• A platform for a new entrant at the Customer Care
of Social Networking.
Center to assimilate skills and get connected with
Social Networking in a Customer Care Center environment peers
offers several benefits, both in the short-term and long-term:
In the long-term, social networking facilitates:
In the short-term, social networking enables:
• A collaborating and sharing environment to build a
• Sharing problem solving or customer handling skills well-informed team and improve the competitiveness
gained through hands-on experience to a wider and efficiency of the Customer Care Center
audience within the Customer Care Center
ABOUT THE AUTHOR
Rajesh Cheeyancheri is a Senior Associate with Communication Media and Entertainment (CME) practice
at Infosys Consulting. Rajesh has more than 17 years of experience in the telecommunication industry
spanning technical and consulting roles at telecom equipment vendors and services companies. Currently
he is focusing on the customer service in the CME industry.
11

12. The death of distance in Supply Chain
Shyam.R.Rao
Technology as an enabler of BPO operations has moved beyond process and
productivity improvements to being an enabler of the client's business performance.
Supply Chain BPO services offer the greatest potential in transforming the client's
business operations by bridging the distance between front and back office supply
chain processes. Supply Chain Visibility dashboards in particular have the ability to
enhance collaboration between the client and BPO vendor to optimize the global
supply chain in real time. We explore the potential benefits and impact the SCV
dashboard can bring about in managing the supply chain in an outsourced
environment.
12

13. Introduction
As the BPO industry has matured, it has developed more and more sophisticated tools and technologies to enable its processes.
The move has been from simple inward looking tools like workflow and training tools that enabled the vendor's functions to
automation tools which help boost productivity and improve client's back office functions. The next wave of technology in
this growth curve will be those that directly impact and enable a client's business functions.
>>>>>>>>>>>>> Tool Complexity >>>>>>>>>>
Tools impacting clients
business operations
Eg: Supply chain
dashboards
Tools impacting
3
vendor and client
Eg: Automation tools
Wave
Vendor enabling tools
2
Eg: Workflow, training
tools
Wave
1
Wave
>>>>>>>>>>>>>>>>>>>>>>>> Impact on client operations >>>>>>>>>>>>
addressed the key concerns of an industry in its infancy - the enablement of operations in a
stable and efficient manner. Workflow tools and technologies to enable knowledge capture
Wave 1 technologies and transfer were, hence immediately put into practice to ensure that the operations at the
vendor's offshore locations were planned and routed through smoothly. The outcome was the
successful transfer and performance of back office operations at the vendor's premises.
addresses issues such as improving the productivity of client's processes being performed by
Wave 2 technologies the vendor. Automating tools like macros, OCR etc help to reduce effort involved and thus
reduce costs and increase efficiency of processes for the client and vendor
will go beyond the process and enable the business performance of the client. This will
involve moving beyond the process and look at impacting the business metrics of the client.
Thus Wave 3 technologies will enable BPO organizations to go beyond the incremental
Wave 3 technologies benefits from initiatives like six sigma, kaizen etc and achieve exponential benefits from
leveraging "tech as a multiplier" in its processes. This will be particularly effective in
functions like supply chain wherein the use of technology can bring about increased visibility
and the ability to pro-actively remedy and optimize the value chain in real time.
13

14. Enabling the Supply Chain 4. Track resolution - through reporting of status and
impact of corrective actions identified above
The supply chain provides a fertile ground for the
implementation of Wave 3 technologies due to the An important feature of the dashboard is its ability to link
challenges posed in this area, as well as the exponential varying systems together and enable the client to view the
benefits available from implementing tech based solutions consolidated supply chain and collaborate with the BPO
to these challenges. Supply chain managers are typically vendor of back office supply chain processes to influence
confronted with several obstacles in their efforts to optimize and optimize it in real time.
the value chain in real time:
• The components of the global supply chain are
disbursed across multi-location, multi system and Benefits of a dashboard in Supply Chain BPO
across partners/customers with varying requirements services
and demands with no common platform
A major risk that organizations face in outsourcing back office
• Organizations also tend to have multiple legacy processes of a supply chain is that of distance - distance
systems that will not talk to each other seamlessly from supply chain partners, distance due to time zones and
• Observation of "danger" signals cannot be done in distance due to varying systems that prevent visibility and
real time and remedial actions taken in retrospect inhibit real time control and optimization of the supply chain.
sometimes result in greater damage leading to By integrating supply chain visibility dashboards into the
inefficient supply chains outsourced environment, this risk of distance can be
• Out sourced back office components of the value chain effectively addressed and overcome. Some of the benefits
further complicate the end-to-end visibility and control of this integration of dashboard technology and BPO services
of the supply chain in the supply chain area are:
Supply chain managers are hence increasingly looking at • The death of distance in the supply chain - thus
visibility dashboards that link the various components/ enabling real time monitoring and control of back
systems together and provide a consolidated view of the office supply chain processes
performance of the supply chain through well defined KPIs. • Collaborate in real time with the back office BPO team
These dashboards combined with analytical and to optimize the supply chain by cross/ upselling,
collaboration tools will help monitor and influence the supply expedite/ substitute, prevent stock outs and increase
chain to enable real time optimization. conversion ratios
• Provide a productivity tool for the client to manage
offshore operations by moving the needle from
The Supply Chain Visibility Dashboard process metrics to business metrics1
A supply chain dashboard will typically involve 4
Thus by enabling supply chain visibility through SCV
components:
dashboards in an outsourced environment will de-risk
1. Configurable metrics - Specific KPI's which cover both offshore supply chain operations and ensure real time
process (TAT, accuracy, productivity) and business operational control and optimization. This would of course
metrics (inventory turns, perfect orders, DSO) which work best when client and service providers collaborate to
can be customized by supply chain managers to ensure that all touch points in the process are optimized
capture their business imperatives through the application of the technology.
2. Supply Chain Exception Management (SCEM) - by Alerts
generated from pre-set values to above metrics. These
alerts will be routed through role based user hierarchy
3. Analytical and Collaborative tools - which enable drill
1
down root cause analysis and collaborative problem Vijai Kumar Balachandra & Radhakrishnan Prashant, "Moving the
needle in Order Management outsourcing: From Process metrics to
solving of above exceptions Business metrics", BPO Journal II, 2008
14

15. Case Study
A global provider of imaging technology products and services wanted visibility into
its service and product performance which include products like digital cameras,
printers, imaging accessories and equipment. It also needed the ability to track
consumer concerns, calls, and problems with products, returns and replacements.
The company partnered with a service provider to create a plug and play supply chain
visibility and collaboration workbench based on Microsoft BI stack which consolidated
information fragmented across the company's multi-tier, multi-system global supply
chain. This customized workbench/dashboard provided the client with a platform to
monitor and control its supply chain in real time by detecting signs of possible failures
and resolving them proactively. This visibility into product defects and the agility in
resolving them has enhanced call center/back office performance and reduced repair
and return rates, driving up overall customer satisfaction.
Conclusion References
The supply chain provides immense scope to enhance and 1. Vijai Kumar Balachandra & Radhakrishnan Prashant, "Moving
the needle in Order Management outsourcing: From Process
enable the collaboration and optimization of processes
metrics to Business metrics", BPO Journal II, 2008
between the client and his BPO partner through the
2. Arora et al, "Service Performance Workbench - a strategic
implementation of next generation tools and technologies. differentiator", Infosys Whitepaper, Jan 2009
Supply Chain dashboards which bridge the distance between
3. Barret Jane, "Collaborative Inventory Practices yield Market
the front and back office components of the supply chain Advantage" AMR Research, 2008
and bring about visibility into the client's global value chain 4. Hostmann & Richardson, "Succeed with business
in particular will help BPO vendors to go beyond process intelligence by avoiding 9 fatal flaws", Gartner Research,
improvements and truly impact the business performance Sept 2008
of the client's operations. 5. Kard Khalid, "Real World Example: Eastman Kodak Security
Metrics Dashboard" Forrester Research, Apr 2009
6. Orlow et al, "Making dashboards actionable" Forrester
Research, Dec 2003
ABOUT THE AUTHOR
Shyam.R.Rao is a Solution Anchor in the Order Management practice at Infosys BPO. He has 9 years of
experience in the supply chain area in the Hi-tech and Discrete manufacturing space. He is an alumnus
of the London School of Economics
15

16. Designing an Optimal Technology Landscape -
For Accounts Payable Transformation
Shubha Subramanian, Ved Vyas, Rajagopal NVS
Companies that leverage technology to automate their Accounts Payable (AP)
function can achieve sustainable, long-term benefits by aligning cost optimization
objectives to their long-term vision and strategy.
16

17. The current economic condition has caused companies to technology solutions to meet their needs and
experience severe revenue and cost pressure and an requirements, and more importantly, in translating
uncertain future. As a result companies are banking on their long-term vision into action. The sections below
technology to deliver benefits beyond just "cost savings" describe the approach to be followed for the initial
and help create transformational benefits that assessment phase.
can help them not just in turbulent times but in good times
as well.
One area which is becoming an important agenda item for Technology Maturity Framework and Gap
companies all over the world is the automation of AP Analysis
function, because even today an overwhelming majority of Technology maturity refers to a company's ability to leverage
invoices in companies are paper based. With billions of technology to automate its manual, non-value added tasks
dollars worth of invoices getting processed every month, and provide real-time information to enhance decision
inefficiencies in invoice processing and delayed payments making capabilities. The technology maturity framework is
to suppliers can lead to increased costs and end user intended to help companies assess their current level of
dissatisfaction. Given that manual processing of supplier maturity vis-à-vis an evolution roadmap. There are 4 levels
invoices costs anywhere between US $10 to US $20 per defined in the maturity model.
invoice, and keying in information from paper invoices is the
most time-consuming and the least value added task in AP
Level 1
departments, companies are increasingly looking at
technology to drive down costs and improve efficiencies in is primarily targeted at controlling paper workflow
their AP processes. Companies that have successfully of the company.
automated their AP function have managed to bring down
costs to less than $5 per invoice resulting in transformational
cost benefits and significant bottom-line improvement. Other Level 2
benefits include faster ROI, minimized impact of process involves integrating the imaging and workflow
failures and delays, cash management and working capital solution with ERP and sets the foundation for
optimization, improved decision making, enhanced controls simplified invoice processing.
and supplier satisfaction.
Traditional approaches to technology involve understanding
Level 3
of immediate concern areas and gaps, and investing in
software solutions to address those short-term concerns. involving integration between invoice processing
The sections below, however, advocate an approach where software and the ERP system also includes an
the "gap analysis" is done against a "Technology Maturity electronic workflow. This integration can empower
Roadmap" and the long-term strategic vision of the decision making process by providing real-time
company. visibility of invoice status, informative dashboards,
automated escalations and alerts.
We believe that companies that embark on transformation
through technology enablement should do a two way
assessment on before designing the optimal technology
Level 4
landscape for its AP function. The assessments involve a
detailed review of the following: is primarily applicable to large organizations that
operate in multiple geographies, languages and
• existing processes and technology the company
have large volumes of data. This level requires heavy
currently has;
up-front investment in supplier data management
• profiling and segmentation of their supplier base and
solutions, e-invoicing, Supplier portal, payment
evaluation of suppliers' capabilities and fitment into
factory.
the overall technology solution. BPO service providers
play a major role in helping companies tailor
17

18. Level
Level
Level
Level
Level
0 1 2 3 4
Low complexity High complexity
• Automatic
uploads of
• Implement
vendor master
invoice tracking
system data requests
• Implement • Implement into ERP system
scanning approval via ERP • ERS
• Implement system (OCR integrated • EDI / e-invoicing
scanning integrated) system • Vendor portal
• Manual • Implement ERP • Implement • Introduce
system
Processing integrated vendor query payment factory
• Implement work flow
• No workflow status tracking
workflow • Implement ERP system
integrated PO Automate through
system e-Invoicing
Real time
environment
Automated Data
Flow
No Paper Flow
Manual
Table 1: AP Technology Maturity Model
The tools and technology solutions currently used and their service offerings. Technology acts as a key enabler that
capabilities thereof will need to be mapped against the facilitates this collaboration with the extended enterprises.
maturity framework. This will help a company in identifying Data analysis can help in identifying distinct supplier
its current state of technology maturity and benchmark its segments and understanding the characteristics and
capabilities against best-in-class (Level 4). This constraints that define each of the segments. The questions
benchmarking exercise can help companies identify to be considered while identifying the supplier segments
investments and capabilities required to transform its AP include:
function. • Are the suppliers regular or one-time suppliers?
As companies aspire to move up the maturity model, there • Do the suppliers supply goods or services?
would be varying levels of investments required at each level.
• Are the suppliers high-volume or low volume
Any investment in technology should be planned in such a
suppliers?
way that it acts as a business efficiency enabler and provides
• Are the transactions with the suppliers of high- value
tangible business benefits. The high technology investment
or low value?
required to automate some of the manual, non-value added
activities in the AP process is one of the major reasons for • Are the purchases from the suppliers against a PO or
outsourcing the AP function to BPO service providers. are they non-PO supplies?
• Are the transactions with the suppliers simple or
complex in nature (attributes to be considered include
Supplier Profiling and Segmentation language capabilities, invoice formats, geographies,
tax related issues etc)?
Another important evaluation involves a detailed study of
the supplier database to understand the profiles of the More often than not, companies will have to deal with
suppliers the company deals with and their historical suppliers with varying degrees of technology maturity. The
behaviour pattern. Companies with insights and supplier profiling and segmentation exercise can provide
understanding about their suppliers are better placed to pointers about the type of technology investment required
collaborate with suppliers to innovate their products and to optimize ROI. The company should consider investing in
18

19. ERS and EDI / e-Invoicing for high-value and high-volume Designing an Optimal Technology Landscape
suppliers. Though the company has to make upfront
Evolution of technology is not a linear process and a single
investment in setting up the technology platform and process
approach to technology should not be uniformly applied to
for reconciliation, long-term benefits (by way of improved
companies. Rather a "One Size Fits All" approach to
working capital predictability, improved on time payment
automation needs to be replaced by a strategy that is
capabilities and significant reduction in processing costs)
customized to fit a company's overall strategic vision, needs
can be quite significant. For the suppliers, the benefits would
and expectations from technology solutions.
include prompt payment, better cash forecasting, lower bad
debts etc. On the other hand, for low-value, high-volume The optimal technology landscape should be finalized after
suppliers, P-card implementation might be the optimal taking into consideration the following factors:- current
solution. Similarly for suppliers who are in the mid-segment, technology capabilities, relationship maturity of the supplier
a company may decide to implement image scanning segments, tangible and intangible benefits expected from
integrated with workflow as it requires no investment from automation and strategic long-term vision of the company.
suppliers but can yield significant benefits to the company. Identification of the desired state in maturity model will help
in identifying gaps, prioritizing resources, focus areas and
The diagram below is an illustrative list of technology
will, more importantly, aid in chalking out an action plan to
solutions that companies could consider for their supplier
get to the desired state. It should also enable the company
segments:
to cope with the immediate constraints and challenges while
Therefore a thorough understanding of the supplier segments making it agile enough to adapt to the changes that the
and their characteristics can go a long way in engaging with business might undergo in future.
the suppliers and designing the most appropriate technology
Companies do not have to go through the various levels of
interventions for each of the supplier segments that can
technology maturity in sequence and can adopt a multi-pronged
provide win-win situations for suppliers and companies.
approach to realize optimal benefits from the automation
Solution
Supplier Characteristics Benefits
• Suppliers with established mutual • Supplier invoicing and invoice entry process eliminated
trust relationship • No delays in payment, pay only for what you receive.
• # of invoices and invoice value are ERS • Pre-determined invoice cycle time resulting in improved working
large capital predictability
• Manual goods receipts against POs • Processing cost per invoice will be in the range of $ 0.80 to $ 2.50
• No manual intervention required to process invoices
• Non-ERS suppliers
EDI or Electronic • Improved invoice cycle time and visibility through invoice life
• # of invoices and invoice value are
Invoicing cycle
large
• Reduced Processing cost per invoice
• Manual goods receipts against POs
• Improved ability to avail early payment discount
P-Card / Self Service • Minimize the manual efforts through p-Card, Self Service Vendor
• Low value purchases
Vendor Portal portal, PO flip etc
• Prepayment
• Simplified process
• Centralized sorting and OCR scanning resulting in improved
• # of invoices and invoice value is process efficiency
medium or Low
Paper-Based Invoices • Workflow enabled with integration with ERP to reduce cycle time
• Paper invoices for suppliers with and improved visibility through invoice life cycle
no e-invoice capability • Approval workflow for non-PO to ensure compliance and visibility
Table 2: Technology Solutions for Supplier Segments
19

20. process. There are tangible benefits to be reaped in each of the create a synergistic value to companies. Only then can the
levels of the maturity model and based on priorities, pain areas benefits be truly enduring. BPO providers have the requisite
and resource constraints, companies can, with the help of BPO capabilities to combine expertise in process outsourcing and
providers, move up the evolution chart either in a fairly short technology in a synergistic way within the AP framework to
time-frame or over a longer period of time. For example, provide integrated value benefits to companies.
companies that are at Level 0 (of the technology maturity model)
Proven technology and optimization expertise of BPO service
can leverage outsourcing and technology expertise of their BPO
providers can enable companies to scale up the automation
partners to move to Level 3 in the short-run. However not all of
of their AP functions at reduced cost and in a relatively short
its suppliers would be ready or willing to invest in technology
period of time. BPO providers will work with companies not
for several reasons including ROI, strategic importance of the
just in automating and harmonizing their internal AP
supplier, value of business transacted between the company
processes but also in analyzing and working with the various
and the suppliers etc. It is, therefore, imperative to adapt to
suppliers to design optimal technology solutions for each of
other alternatives to accommodate suppliers unwilling to invest
the supplier segments depending on their relationship
and overhaul their existing processes.
maturity levels (Refer Table 2). The benefits that BPO
In the process of automating functions, it is important to companies provide are mentioned below:
align process improvements with technology solutions and
Offerings of the
BPO Service Provider Benefits to Clients
• Predictability of working capital requirements
• Improved Discount Capture %
Working Capital • Reports and analysis • High Visibility on Payables outstanding
Efficiency • Unlock cash flows
• Prevent late payments (& penalties)
• Outsourcing • ~30% Cost savings, Labor arbitrage & shift in
• Work Flow Tools
focusing controls, Macro Management
• Special Handling of discount
• Productivity and Cost Reduction
Cost Optimization eligible invoices
• From Cost Center to Self serving model.
• Help in converting Paper based
invoicing Supplier to electronic • Reduction of Manual invoice processing and cost
based (ERS, EDI or E-Invoicing) of the same
• Workflow tools • Improved Paid on Time (PoT) capability
• ERP Integration • Productivity
Operational Efficiency • Automation - OCR • Escalation and tracking
• Reports and analysis • Well informed policy decisions
• Drive Standardization and • Consolidation - One process for all
harmonization geography/entity
Continuous • Improved Accuracy • Leveraging the best talent across industries
Improvements • Innovation • Year on year reduction in TCO
• Best Practices Sharing • Eliminate waste and non-value added activities
• Minimal time spent on answering Invoice status
and payment queries
• Supplier Portal (Self Help tool for
End User Satisfaction • High visibility of supplier queries and higher
suppliers)
supplier satisfaction on account of accurate and
predictable payments
• Automated Approval flow
• Audit Trail • Electronic Audit Trails
Controls & Compliance • Duplicate Processing control • Revenue leak avoidance
• Better enforcement of business and SOx controls
20

21. Conclusion
Companies all over the world suffer from an over-reliance on manual processes. The inefficiencies of the manual processes are
often overlooked during times of high growth but become prime candidates of focus during times of recession. New tools,
technology and platform solutions have evolved in the last few years that can automate the manual, non-value added tasks
inherent to AP function and provide transformational benefits to companies.
ABOUT THE AUTHORS
Shubha Subramanian - heads the Finance Center of Excellence and handles domain competency and
knowledge management initiatives of F&A practice at Infosys BPO. She has worked in the core finance
and accounting functions for several companies and also has experience working as a trainer. Shubha is
a Chartered and Cost Accountant and also holds MS and MBA degrees in Corporate Finance from University
of Wisconsin, U.S.A.
Ved Vyas is responsible for driving the products & alliance strategy and commercialization in the F&A
practice at Infosys BPO. Ved brings around 14 years of experience in program management, customer
relationship management, outsourcing transition and business development. Ved has led many cross-
functional and multi-location teams to ensure delivery of ERP implementations and custom development.
He has also worked as a Manager in Steel Authority of India (SAIL) for a couple of years where he was
involved in production planning & control. He is a B.Tech graduate from IIT-Kanpur and an MBA from
IIM Ahmadabad.
Rajagopal NVS is the P2P Product Manager for F&A Products & Alliances team at Infosys BPO. He has
rich experience in P2P domain - managing operations / designing products & developing reconciliation
solutions. Raj has worked with global corporations - across industries like manufacturing, dot com, Capital
and healthcare. He is a commerce graduate.
21

22. Special Tools for Special Purposes - Addressing the
Sourcing & Procurement Challenges
Bipin Wadhwa with Ravi Panchanadan
Although a number of procurement technologies have entered mainstream adoption,
there is significant continued innovation in procurement, as evidenced by new
technologies, and ongoing refinements in current offerings and product offering
restructuring. Several procurement technologies are becoming mainstream
solutions, including strategic sourcing applications, spending analysis and
e-procurement. These solutions are appealing to a wide audience because of their
proven track record to enable and/or deliver significant cost reduction.
* Hype Cycle for Procurement Applications, 2009; by Deborah R Wilson, Andrew White, et al.;
28 July 2009, Gartner, Inc.
22

23. Enterprise resource planning systems have been, for some For example, from a CPO's perspective, the reduction of cost
time, the key automation enablers of procurement function. & better cash flow can be achieved by sourcing better. For
They have, perhaps in many cases, created discipline in this, summarized & detailed view of all spends must be
transactional process execution and resultant data available through a decision support CPO DASHBOARD,
management. However, the Chief Procurement Officer's (CPO) preferably at the finger tips of the CPO and his team. It should
challenge to reduce procurement cost can be further enable the management, at various levels, to understand
addressed at various stages of sourcing and procurement the progress over key procurement performance metrics,
cycle, through use of specific special purpose automated which area or category could potentially need deeper
tools (which may be decision support, process accelerators investigation for correction, or a relook at strategy.
or collaboration tools). But then, this is easier said than done, for many a time, the
Special purpose tools are generally used for a niche set of reporting flexibility in applications used may be limited - after
activities such as spend reporting, spend analysis, all each one has his own approach to review the information.
negotiation management, (master) data cleansing, cost policy Special purpose tools have been able, to a large extent,
compliance and control. No doubt organizations can evaluate, address these by using feeds from different application
implement and deploy such solutions entirely through internal instances, and providing the dashboard, which can furnish
efforts, but now with evolution of service offerings by the desired summary, and dig deeper to identify possible
Business Process Outsourcing organizations, using their area of variance. Similarly, organizations can take advantage
services can create additional advantages - of service of sourcing and procurement point solutions, which provide
knowledge, expertise and cost. niche functionalities to address different challenges.
The context - CPO Challenges The fundamental difference - ERP and Special
The economic recession has brought forth the need to reduce Purpose tools
and control costs. The Chief Procurement Officer's role has Growth is an imperative strategy of all organizations. As
gained importance given the CPOs teams' influence over organizations grow in revenue and size - people, capacity,
managing spends. While proven technologies that enable volume, sites, products and services, the underlying operations
transactional activities exist, such platforms may not generally need to keep pace. Enterprise resource planning platforms
always support every facet of sourcing and procurement enabled implementation of collaboration between various
activities that can help reduce or manage spends better. parts of the organization, through set of well defined and
standard processes. In doing so, they enabled a resultant
repository of data, or database, consisting of transactional
CPO DASHBOARD
Using MS SQL Servers, SharePoint &
Performance point technology, a CPO Examples of processes that were primary
Dashboard can provide an individual user focus of enterprise resource planning are
defined dashboard layout, with instant alerts raising & approval of purchase requisitions,
and mail messaging collaboration raising of approved purchase orders based on
purchase requisitions, recording of goods
receipt, recording of invoice and matching
them with purchase orders and goods receipts,
SPENDING SCORECARD
Goal &
recording of payments to vendors and
Value Trend
Status reporting of payables. For a very large
% of Savings YOY 7.45% 11.22% organization, the sheer volume of these
% Spend under Management 92.55% 89.05% transactions can be mind-boggling, and well
Active Suppliers per Billion & Spend 204.65# 45.12# served by such applications systems
% Spend from High Cost Countries 53.35% 52.00%
23

24. data generated through execution of processes. Many of these, found to fall short. They generally have ability to interface
due to the nature of standardized and well defined processes, with, or use data from, varied end to end technology solutions.
permitted themselves to be outsourced to captive or third party
shared services organizations.
Uses, deployment challenges of special purpose
Special purpose tools, on the other hand, address a specific
tools in sourcing & procurement functions
activity or set of activities that may help in providing analytics
to supporting decisions, or accelerators to executing However, this may be easier said than done, for either data
processes, or collaborate with suppliers. required are available in different and variant systems
The spend analysis solution tool is enabled by on line analytical processing
or OLAP technology, which allow fast analysis of shared multi-dimensional
information. Unlike traditional database management systems, which store
data in many two dimensional or flat tables, OLAP technology allows data
to be in a three dimensional table. It supports multiple hierarchies which
allow data to be categorized and classified & viewed at various levels
WHAT (dimensions, nesting and categories).
CREATES It permits easy data manipulation - slicing (extracting values relating to a
THE single value of a dimension), dicing (extracting a sub cube of original), rotating
ADVANTAGE? (changing the dimension orientation or swapping a row/column with a off-
Illustrated with spreadsheet dimension).
example of how
Data from different systems, with different file & data formats, can be ported
typical spend
(loaded) into the solution tool. One can define a standard format and for
analysis solution
each source data type, rules to load and convert into standard need to be
works.
defined and re-used.
Similarly, for creating analytical reports, rules based reporting templates can
be created. Any ad-hoc reporting template, can also be created using certain
commands.
An important aspect of the point solution tool is that all hierarchies and
rules set can be modified with limited efforts.
For example, with the set of data available through the (enterprise resource planning or legacy applications), or data
repository generated from enterprise resource planning may not be adequate, or capability to conduct the analysis
systems the procurement leaders would need an analysis of may be limited. Then again, the humungous information may
their spend for a period. Special purpose tools can help first require DATA CLEANSING, issues arising from the
facilitate the tasks to collate, organize, classify, analyze &
summarize spends for each category or commodity, by various
dimensions. The base data will be obtained from the enterprise DATA CLEANSING
resource planning databases, processes & analyzed in the Special data integration tools can facilitate
special tools. Generally, you may find the special purpose tools review of the data from various systems,
a better option to use, because of their concentrated focus, analyze issues, and clean data based on
the tools have built in niche functionalities to address varied defined data quality rules
issues involved (tactical or transactional). They are often
resorted to in areas where general end to end solutions are
24

25. existing junk or duplicate data or availability of data in These indeed have led to cost savings, by the sheer visibility
different formats. So, there will be efforts required to carry of, and increased competitiveness amongst suppliers. And
out data rationalization, data enrichment and organizing to it creates transparency in purchasing and supply process!
a standard data schema - perhaps both at transactional and
But, does all procurement take place as per contract terms
/ or master data level. Special purpose tools can serve as
and conditions? Is there any chance of cost leakages due to
process accelerators here.
say, incorrect prices being levied or in appropriate
implementation of the terms? Such conditions could exist in
SPEND ANALYSIS many organizations, and many times trying to keep track of
Based on OLAP technology, these tools can all of these can be quite challenging. Two such instances
port spend data sets from different systems, are keeping track of use of software licenses (SOFTWARE
permit classification at different levels of ASSEST MANAGER) and managing telecom spends
data, defined analytical reporting templates (TELECOM EXPENSE MANAGER). Suffice to say, each have
and generate multi-dimensional spend reports. own set of challenges. There are tools to accelerate the
Standard and ad-hoc reports can be thus process of compliance and control for such special cases.
generated in a speedy manner, with spend It usually is in the interest of procurement to ensure that the
patterns made visible with high and detailed organization pays only for the software licenses actually
level views available used, and to identify license reallocation opportunities. One
needs to evaluate compliance of software license terms.
But again, the use of licenses may be decentralized, with
The cleaned data can be analyzed by various dimensions,
many points of use. Tools can be deployed on servers, to
using the SPEND ANALYSIS tools, a combination of process
gather the license usage data from various systems, which
accelerators and decision support. The resultant output
can then be analyzed for deployment patterns, and identify
enables visibility of spend patterns. One may even need to
areas for rationalization and changes. Surely, preventing over
enrich the existing spend data set by adding external values
utilization, in many cases, means preventing penalties.
such as data or supplier codes, from external sources, to
Under-utilized licenses can perhaps be discontinued. But
permit better classification and analysis. For sourcing, the
deploying this tool needs some specialist understanding and
spend view can provide an enhanced understanding of the
then, there is manual effort in conducting the compliance
spend requirement and its patterns. The enhanced spend
review once the inventory is generated.
data reports, amongst others, can thus be used for reviewing
or developing and deciding on spend strategies.
SOFTWARE ASSET MANAGER
As we go downstream in the process, there are other e-
SOURCING tools that well serve collaboration with suppliers, Such tools can generally easily be ported on
which we find useful. During the sourcing strategy execution, to organizations' servers, under secure
one may need to invite request for proposals (RFPs) or conditions, and can inventories the usage of
information or quotations (RFIs/RFQs), to allow various specified high costing software licenses. The
suppliers to bid and compete. This may be a time consuming software license can be monitored
process, if we leave it as manual paper based or simply email
based enabled. Collaborative tools for such request can be
used. These tools permit online contact, submission of
In the second case, telecom expense is generally a large chunk
requirements and terms, with response from suppliers and
of the spend portfolio given the ever increasing dependence
creating comparatives. These special tools or applications
of electronic means of communication. Each region may have
can create reduced cycle times and processing efficiencies.
its own set of service carriers, who are contracted with, and
Moreover, sourcing tools have also been found to be useful need to be managed. The new connection requests, old attires,
to negotiate, with short listed suppliers invited for on-line requests, call reports and invoices all of them arguably deserve
reverse auctions. Such on-line auction tool can be used well, scrutiny, as the sum of errors may prove to be a large hole in
with variance of what data we want the suppliers to know. the pocket. The solution, as do others, needs combined set of
25

26. tool and services, that can establish a cost effective and There may be little doubt regarding the advantages that such
scalable network, improve transactional service efficiency and tools offer. But there can be implementation challenges and
reduce cost of operation. extensive manual efforts. Given the challenges related to
systems and data, there are enormous manual activities
involved in this processes, generally because large
TELECOM EXPENSE MANAGEMENT
companies require handling huge volumes.
Such tool can automate telecom related
inventory, order tracking, call detail reporting, Business process outsourcing / off shoring units are in a
auditing. The tools can link to various known position to specialize in providing the comprehensive
applications systems. solutions to complex spend data harnessing and analyzing
issues. It can combine service with special purpose tools, to
provide the overall solution, based on the client's strategy.
These are some examples of special purpose tools, which Firms can take advantage of these since:
can add value to the sourcing and procurement processes. • Clients can gain not just on labor arbitrage, but also
In some cases, ERP vendors may include them as part of from the expertise gained through varied experiences.
their offerings, or organizations may need to source it from And from comparative speed of implementation when
other vendors. Having said that, in certain cases, one may handled by such experts
develop it! But all in all, such special purpose tools have
• With extensive experience, one tends to have a well
been found useful for decision support or as accelerators to
developed methodology to handle such complex issues
the processes or as collaborative tools.
• The methodology, coupled with the solution tool,
provides a unique opportunity for clients to outsource
Advantages of engaging a business process such strategy and procurement support and focus on
outsourcing partner sourcing strategies for high end products and services
• Furthermore, any existing tie ups by the BPO for the
Traditions change. And so has what a good business process
solution tool can reduce the effort on tool selection
outsourcing partner can do for you.
and training process
In deployment • Creating the initial set ups, indexing, mappings, templates and rules for
data porting or analytical models etc., in various tools (CPO Dashboard,
of solutions
Data Cleansing, Spend Analytics, Software Asset Management)
with special
purpose tools, a • Data profiling, rationalization, enhancement, enrichment, and
business process maintenance (CPO Dashboard, Data Cleansing, Spend Analytics)
outsourcing unit • Capturing data not available in the systems, from various manual & non-
can provide manual sources (CPO Dashboard, Data Cleansing, Spend Analytics,
services, in the eSourcing, Software Asset Management)
areas of • Order provisioning, inventory management, invoice reconciliation &
(examples of dispute management, usage management (Telecom Expense
solutions Management)
discussed above, • Setting up requests for information/quotations/proposals, bids and
where these reverse auctions based on defined criteria ( eSourcing)
may be relevant • Conducting compliance reviews and audits, based on defined criteria
are given in (Software Asset Management, Telecom Expense Management)
brackets): • Generation of related analysis and reports (perhaps all above)
26

27. Conclusion
Traditional data BPO services were enabled by end to end platforms, owned and managed by clients and used by the outsourcer.
The current trend is moving to BPOs investing in development of specific point solutions, which combine service and niche or
special purpose tools. It creates advantages for clients in terms of improvements in cost and effort investment -comparatively
reduced implementation time, benefits arising from not just labor arbitrage, but from ready expertise and centralized focus
services, and possible available tie ups for such tools.
ABOUT THE AUTHORS
Ravi Panchanadan - Heads the Global Sourcing & Procurement Practice at Infosys BPO. Ravi has over
18 years of rich experience in Global Sourcing with Intel Corp and in overall Supply Chain Mgmt with
Unilever. He has been instrumental in setting up International Purchasing Office for Intel in India. Ravi
has a Post Graduate Diploma in Management from Xavier's Institute of Management.
Bipin Wadhwa is part of Global Sourcing & Procurement Outsourcing practice at Infosys BPO. He has 14
years of diversified experience in the area of Operational Process Consulting & Risk. Bipin has been
instrumental in setting up Center of Excellence for Sourcing and Procurement at Infosys BPO. He has
conducted process consulting & discovery assignments involving solutions design and feasibility
assessments, including centralization of processes in a Shared Service Center Model. He is a Chartered
Accountant, Cost Accountant, and certified MBA from Indian Institute of Management, Bangalore with
specialization in Supply Chain Management.
27

28. Winning the Red Queen’s Race – Redoing the math of
value creation for Communication Service Providers
Gopal Devanahalli, Harry Jose, Vinay Peshwa
"Now, here, you see, it takes all the running you can do, to keep in the same place.
If you want to get somewhere else, you must run at least twice as fast as that!"
Red Queen to Alice, 'Through the Looking Glass' by 'Lewis Carroll'
28

29. The Red Queen might as well as have been talking about CSPs are still struggling to addressing leakages in
the Communications Service Provider (CSP) marketplace revenue for their newer products such as IPTV.
of today. Entry of nontraditional entities like Cable and
If done right Business Process Outsourcing can enable CSPs
Utility companies and resultant competition, dwindling of
overcome these operational challenges.
customer base and obsolescence of business models (e.g.
wire line voice) are making CSPs strive twice as hard to
maintain their ARPUs (average revenue per user), let alone
grow it. Getting ahead in this 'Red Queen's race is possible
Unlocking the value gained from Business
only if CSPs are able continuously exceed the expectations
Process Outsourcing - the concept of Value
of their customers through the launch of new products and
Multipliers
services- even if it comes at the cost of Capex intensive The initial business process outsourcing value proposition
network/technology upgrades such as 3G,4G,FTTX rollouts, was one of cost arbitrage. Over time BPO firms have built
femtocells etc. CSPs have responded to these changed upon this value proposition and enhanced the value they
realities in the market place by chalking out detailed provide to CSPs by undertaking process improvements
product portfolio expansion plans in both wireline and through reengineering and six sigma techniques. However,
wireless space and have committed significant investments today a combination of two contrasting factors is compelling
running in to billions of dollars. CSP firms to reconsider their engagement models and the
value they derive from their outsourcing partnerships.
• changed market conditions and challenges faced on
Challenges in keeping Customers 'satisfied' the operational front by CSPs - cost reduction
While launching new products and services will enable perspective
CSPs to meet customer expectations, ensuring that they • the competency demonstrated by pioneering BPO
remain satisfied is possible only if operational process firms in moving beyond the traditional SG& A focus
metrics (fulfillment, assurance and billing metrics) are and developing solutions addressing the Cost of
aligned to the customer experience drivers (ease of Service & Sales portion and Operating Revenues in
installation, quick and painless complaint resolution, single P&L - value creation perspective
bill for multiple services etc.). This is an area where most
The question CSPs are now posing to their BPO partners is
CSPs are facing challenges. The fact that most CSPs have
whether, by leveraging on their CSP operations expertise
retained their legacy systems and process frameworks for
gained over the last few years, they can move beyond
the fulfillment, assurance and billing of newer products
process level improvements and create value at an end-to-
and services have not helped their cause, either.
end value chain level.
Operational inefficiencies are resulting in revenue and cost
leakages as well. Consequently most CSPs today are The implication is that the BPO firm needs to be able to
grappling with a number of challenges in their existing deliver not only on the CSP operations metrics but also on
operations framework. For eg the CSP business metrics as well. This calls for a deep
Product failures - incomplete analysis of supply chain at business driver level understanding of the CSP's line of
the time of product launch have caused product business, understanding of how the operational metrics
failures due to supplier lead times being longer than affects these business drivers as well the expertise to
committed installation SLAs. positively impact the identified business drivers by
eliminating systemic inefficiencies through utilization of a
Customer dissatisfaction/ attrition due to installation
core organizational competency such as the ability to do
delays - improper logistics management have resulted
customized technology interventions. A BPO will then be
in issues like delayed installation due to CPE
able to create a value multiplier for the CSP rather than
(Customer Premise Equipment) being unavailable at
merely provide a process level savings.
the time of installation engineer visit/ loss of CPE etc.
According to us a Value Multiplier is a combination of two
Revenue Loss -Though revenue assurance systems have
competencies
been set up for most of the existing portfolio of products,
29