{"id":1167,"date":"2014-03-13T15:23:00","date_gmt":"2014-03-13T15:23:00","guid":{"rendered":"http:\/\/localhost\/projects\/horsesforsources\/moving-mountains-part1_031314\/"},"modified":"2014-03-13T15:23:00","modified_gmt":"2014-03-13T15:23:00","slug":"moving-mountains-part1_031314","status":"publish","type":"post","link":"https:\/\/www.horsesforsources.com\/moving-mountains-part1_031314\/","title":{"rendered":"Moving mountains with Mike, part 1"},"content":{"rendered":"
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Mike Salvino is Group Chief Executive, BPO at Accenture (click for bio)<\/p>\n<\/div>\n

If there’s one face that’s been consistent with the growth and maturation of BPO over the last decade you’d have Accenture’s Mike Salvino right up there in the Hall of Fame. \u00a0(In fact… he did recently get inducted into the IAOP Outsourcing Hall of Fame<\/a>).<\/span><\/p>\n

Having begun his career with Accenture\u2019s ITO business in the late 80’s and 90’s, Mike spent time on the BPO front lines with one of the industry\u2019s first pureplay BPO providers, Exult and its eventual acquirer Hewitt, before finding his way back to Accenture in 2006 where he led their F&A business before taking full responsibility for the company\u2019s entire BPO function, where, today, BPO proudly stands as one of the firm’s major divisions and strategic focal areas, alongside the firm’s technology growth platform and consulting businesses.<\/p>\n

So we managed to lure “Sal” away from his son’s basketball practice and his beloved North Carolina golf course to discuss the BPO troika – people, processes and technology – and the progress BPO is making to create new career tracks for millions of employees and a long-term sustainable industry of which we can all be proud…<\/p>\n

Phil Fersht (CEO, HfS):<\/strong> Good afternoon, Mike, thanks for joining us. So your focus on \u201cBPO Generations,\u201d has really become written into BPO industry lore since you articulated it three years’ ago<\/a>. You were one of the first to map out the stages the industry needs to go through to be successful with your \u201cGenerations\u201d continuum and our new research (see report<\/a>) shows that buyers are carrying stock in what you call \u201cGeneration Three\u201d (Opex) and around half of them expect<\/em> to be in \u201cGeneration Four\u201d (Insight) in a couple of years. Is this realistic, in your opinion, based on the quality of today’s relationships and can both buyers and providers to up their game?<\/span><\/p>\n

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Mike Salvino (Group Chief Executive, BPO, Accenture):<\/strong> Yes, Phil, I do think it’s realistic. Let me first start with where we’ve come from because I think that will help us understand why I think it’s possible for the industry to move into the fourth generation in the next few years. We have achieved a lot over the last 25 years and we\u2019ve finally built the industry that we wanted way back in the early 90s.<\/p>\n

If you think about the industry as a mountain range\u2014we’ve climbed to the peak of one mountain and at that peak I think that we can give ourselves credit for a trillion dollar industry. We can give ourselves credit for global operations \u2013 and that’s really third generation BPO. We’ve achieved silent running, we’ve achieved the ability to process transactions and we’ve been able to do it with a 24×7 mind set. The other thing that’s really key at the top of that first mountain, and with third generation BPO, is that we have achieved client confidence. Clients now can look at providers and say “Yes, I can count on them for cost savings.”<\/p>\n

Clients today can also depend on this sourcing model to be scalable, meaning we have the ability to scale up and scale down while managing risk. And last but not least, I think we have proven out that third generation BPO works for back office functions like F&A and procurement and also industry-specific front office processes like healthcare and mortgage processing. Now, having said that, most deals still start with us wanting to manage the risk, get the client cost savings and just get the transaction processed appropriately. The sooner we can move through that, I think the better off we\u2019re going to be.<\/p>\n

If we turn our attention now to the real industry opportunity, which is to get to the peak of the second mountain and move into the fourth generation of the market, we need to focus on producing real business outcomes. The only way you can do that is if, on top of all that transaction processing, you really have analytics, if you really have industry knowledge and if you really know how to take that information and get it into the hands of somebody that can create the business impact. What I mean by that, Phil, is so many times I think we do come up with good analytics off of the transaction processing and we do have really good industry insight based on those analytics. But if we don’t get the information into the hands of the right people then it goes nowhere. In this day and age of technology, specifically with mobile apps and social media, we should be able to get that information into the right hands. So that\u2019s what is needed to cross that chasm between the two mountains, or third and fourth generation outsourcing, and a long winded way of saying I think we can do it.<\/p>\n

Clients may not start there all the time, they may start in third. But I think throughout their journey of outsourcing, everybody will want to aspire to get to fourth gen. It will be a journey but the industry is getting there.<\/p>\n

Phil: <\/strong><\/strong>This takes me to the issues around how we can develop BPO as a career<\/em>. Do you think there needs to be more focus on BPO as an actual profession<\/em> as opposed to a job, and do you think that’s at the core of a lot of these change issues clients are tackling right now?<\/span><\/p>\n

Mike:<\/strong> Absolutely. I keep using this “two mountain” theme because I do want to celebrate where we’ve gotten to today \u2013 to the top of one mountain. But I believe the only way we\u2019re going to cross the chasm and get to the top of that that next mountain and achieve greater business outcomes is through investing in our people:<\/p>\n

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HfS did some research last year on the \u201ctalent gap\u201d in outsourcing<\/a>. As you know, it showed that as an industry we\u2019re not investing enough in our people. We\u2019re not giving them the skills they need to generate insights and create business outcomes. I saw four key points in your research:<\/p>\n