Outsourcing the Order-to-Cash Process
The past decade of Business Process Outsourcing (BPO) has seen the growth of a multi-billion dollar industry that has its share of successes, notable failures, and many experiences that fall somewhere in between. Outsourced provider employees can be “offshore”, “near-shore”, or “onshore”, using either new staff or, in some cases, re-badging the existing workforce. Interestingly, the growth and acceptance of BPO follow many of the same patterns that were true for Shared Services, including a reluctance to transfer customer-facing work processes. As one example, Order-to-Cash processes have only recently gained widespread acceptance in Shared Services; a possible future trend for what is acceptable for outsourcing.
iPollingTM Results Review
A recent iPollingTM question explored the frequency of outsourcing Order-to-Cash processes and the overall strategy for outsourcing customer-facing work activities. The results for the first question show that 34% of member companies currently have a significant (17%) or moderate (17%) level of outsourcing in Order-to-Cash. In addition, 33% have a limited outsourcing scope and 33% have not outsourced at all in O2C. It is interesting to note that no companies have outsourced the entire Order-to-Cash process.
The second polling question explored the current status of outsourcing customer-facing processes within Order-to-Cash, with 13% having implemented this on a wide basis and another 13% on a limited basis. While an additional 17% are currently evaluating this option, the remaining 57% have already evaluated this type of outsourcing and chose not to do so.
Here are some comments from iPollingTM participants:
- Consumer Products & Services Member: All transactional activities are now outsourced globally. Customer-facing activities remain in-house.
- Non-Profit Member: Minor differences in O2C outsourcing activities based on line of service.
- Healthcare, Pharmaceuticals, Biotech Member: We have criteria governing which processes are outsourced.
- Consumer Products & Services Member: Top strategic customers were not outsourced for collections and customer engagement.
- Manufacturing Member: I’m sure it has been evaluated, but currently there is no discussion regarding outsourcing this process.
The results from this recent poll clearly demonstrate the wide variety of opinions regarding the outsourcing of customer-facing processes that resides within Order-to-Cash. There are some clear advantages to doing so, but the associated risks are just too high for many companies.
How aggressively has your company pursued outsourcing as part of your Shared Services strategy? How carefully do you protect customer-facing processes, and do you expect your approach to change over the next few years?
Who are your peers and how are you collaborating with them?
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