{"id":4560,"date":"2008-01-31T18:19:00","date_gmt":"2008-01-31T18:19:00","guid":{"rendered":"http:\/\/localhost\/projects\/horsesforsources\/is-the-financial-services-sector-finally-warming-to-bpo\/"},"modified":"2008-01-31T18:19:00","modified_gmt":"2008-01-31T18:19:00","slug":"is-the-financial-services-sector-finally-warming-to-bpo","status":"publish","type":"post","link":"https:\/\/www.horsesforsources.com\/is-the-financial-services-sector-finally-warming-to-bpo\/","title":{"rendered":"Is the financial services sector finally warming to BPO?"},"content":{"rendered":"<p class=\"MsoNormal\" style=\"MARGIN: 0in 0in 0pt\"><span style=\"FONT-SIZE: 10pt; FONT-FAMILY: Verdana\"><a href=\"http:\/\/fersht.typepad.com\/photos\/uncategorized\/2008\/01\/31\/tcslogo_2.jpg\"><img loading=\"lazy\" decoding=\"async\" title=\"Tcslogo_2\" height=\"49\" alt=\"Tcslogo_2\" src=\"http:\/\/www.horsesforsources.com\/images\/2008\/01\/31\/tcslogo_2.jpg\" width=\"49\" border=\"0\" style=\"FLOAT: left; MARGIN: 0px 5px 5px 0px; WIDTH: 49px; HEIGHT: 49px\" \/><\/a> My interest has been piqued by the recent <a href=\"http:\/\/www.tcs.com\/NAndI\/Default1.aspx?DocType=327&amp;docid=1595\">announcement<\/a> of Sunlife of Canada outsourcing its UK customer services operation to TCS&#8217;s Diligenta subsidiary in a $200m deal.&nbsp; &nbsp;This comes hot on the heels of some financial services captive buy-outs in India.&nbsp; The financial services sector has long been the problem child of the BPO industry, with operational executives extremely reluctant to relinquish control over business processes &#8211; especially finance and accounting.&nbsp; As I have said on record several times, it will only take a few big deals to hit and many others will follow in a domino effect.&nbsp; Bottom-line, the large BPO providers have capacity and are willing to invest in clients to gain an edge in this market.&nbsp; Most of the near-term deals will more likely be captive acquisitions like the two mentioned above, but this is the clear strategy some of the providers are following to build out a global delivery infrastructure.&nbsp; (Hey &#8211; I managed to avoid saying <em>lift n&#8217; shift<\/em>).<\/span><\/p>\n<p class=\"MsoNormal\" style=\"MARGIN: 0in 0in 0pt\"><span style=\"FONT-SIZE: 10pt; FONT-FAMILY: Verdana\"><span style=\"color: #ffffff;\">&#8216;<\/span><\/span><\/p>\n<p class=\"MsoNormal\" style=\"MARGIN: 0in 0in 0pt\">\n<p class=\"MsoNormal\" style=\"MARGIN: 0in 0in 0pt\"><span style=\"FONT-SIZE: 10pt; FONT-FAMILY: Verdana\">So why do I think this sector is poised to become a BPO hotbed?<\/span><\/p>\n<p class=\"MsoNormal\" style=\"MARGIN: 0in 0in 0pt\"><span style=\"FONT-SIZE: 10pt; FONT-FAMILY: Verdana\"><span style=\"FONT-SIZE: 10pt; FONT-FAMILY: Verdana\"><span style=\"color: #ffffff;\">&#8216;<\/span><\/span><\/span><\/p>\n<p class=\"MsoNormal\" style=\"MARGIN: 0in 0in 0pt\">\n<p class=\"MsoNormal\" style=\"MARGIN: 0in 0in 0pt\">\n<ul type=\"disc\" style=\"MARGIN-TOP: 0in\">\n<li class=\"MsoNormal\" style=\"MARGIN: 0in 0in 0pt; mso-list: l0 level1 lfo1; tab-stops: list .5in\"><span style=\"FONT-SIZE: 10pt; FONT-FAMILY: Verdana\">Competition is too fierce and the incumbents are looking at all options to contain costs and improve margins;<\/span> <\/li>\n<li class=\"MsoNormal\" style=\"MARGIN: 0in 0in 0pt; mso-list: l0 level1 lfo1; tab-stops: list .5in\"><span style=\"FONT-SIZE: 10pt; FONT-FAMILY: Verdana\">Decreased shelf life of products;<\/span> <\/li>\n<li class=\"MsoNormal\" style=\"MARGIN: 0in 0in 0pt; mso-list: l0 level1 lfo1; tab-stops: list .5in\"><span style=\"FONT-SIZE: 10pt; FONT-FAMILY: Verdana\">Business impacts and high costs of maintaining non-strategic and closed blocks of business;<\/span> <\/li>\n<li class=\"MsoNormal\" style=\"MARGIN: 0in 0in 0pt; mso-list: l0 level1 lfo1; tab-stops: list .5in\"><span style=\"FONT-SIZE: 10pt; FONT-FAMILY: Verdana\">Rising wage costs and attrition within captives is proving too costly and taking up far too much management resources &#8211; the outsourcing option is becoming increasingly attractive and less risky from a business perspective; <\/span><\/li>\n<li class=\"MsoNormal\" style=\"MARGIN: 0in 0in 0pt; mso-list: l0 level1 lfo1; tab-stops: list .5in\"><span style=\"FONT-SIZE: 10pt; FONT-FAMILY: Verdana\">The sub-prime fiasco has really changed the game with several FSI firms &#8211; they are now prepared to take on more risk to remain profitable;<\/span> <\/li>\n<li class=\"MsoNormal\" style=\"MARGIN: 0in 0in 0pt; mso-list: l0 level1 lfo1; tab-stops: list .5in\"><span style=\"FONT-SIZE: 10pt; FONT-FAMILY: Verdana\">BPO models can help firms scale up and down quicker &#8211; particularly with a looming economic downturn.&nbsp; Having that flexibility could prove vital, especially in times when FSI firms need to get product to market quickly;<\/span> <\/li>\n<li class=\"MsoNormal\" style=\"MARGIN: 0in 0in 0pt; mso-list: l0 level1 lfo1; tab-stops: list .5in\"><span style=\"FONT-SIZE: 10pt; FONT-FAMILY: Verdana\">Improved service levels from providers and their willingness to take on more customer risk;<\/span> <\/li>\n<li class=\"MsoNormal\" style=\"MARGIN: 0in 0in 0pt; mso-list: l0 level1 lfo1; tab-stops: list .5in\"><span style=\"FONT-SIZE: 10pt; FONT-FAMILY: Verdana\">Improved technology add-ons at no incremental cost, for example analytics tools, that can sweeten the BPO opportunity.<\/span><\/li>\n<\/ul>\n<p class=\"MsoNormal\" style=\"MARGIN: 0in 0in 0pt\">\n<p class=\"MsoNormal\" style=\"MARGIN: 0in 0in 0pt\"><span style=\"FONT-SIZE: 10pt; FONT-FAMILY: Verdana\">More on this issue shortly&#8230;.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>My interest has been piqued by the recent announcement of Sunlife of Canada outsourcing its UK customer services operation to&#8230;<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[50],"tags":[],"organization":[],"ppma_author":[19],"class_list":["post-4560","post","type-post","status-publish","format-standard","hentry","category-captives-and-shared-services-strategies"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v24.4 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Is the financial services sector finally warming to BPO? - Horses for Sources | No Boundaries<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.horsesforsources.com\/is-the-financial-services-sector-finally-warming-to-bpo\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta 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