Lowering Business Process Outsourcing Risk And Cost
As organizations turn to business process outsourcing (BPO) to reduce operating costs and refocus on core competencies, they are encountering challenges involving the security, privacy and control of corporate applications, information and intellectual property. Although BPO typically requires a service provider to work with process inputs and outputs in the form of data and applications, companies are often reluctant to give BPO service providers physical control of confidential or sensitive information. Worries about security breaches, data theft or loss, and lapses in compliance with privacy and accountability legislation such as the Healthcare Insurance Portability and Accountability Act (HIPAA) and the Sarbanes-Oxley Act, can make outsourcing less appealing.
Fortunately, a solution is available for giving service providers secure, remote access to corporate applications and data while enabling client organizations to retain physical control of these assets within their own data centers. Access infrastructure software not only securely delivers information access over the network to any location, but also keeps bandwidth and system management costs down, supporting the primary objective of the BPO model.
The Promise And Challenges Of BPO
Companies today are being pushed by consumers and shareholders to reduce their costs, with the goals of lower prices and greater returns, respectively. One target area is the many labor-intensive functions that still exist in the back offices of organizations. When these are being performed in high-cost locations, they become candidates for outsourcing typically to an offshore service provider in a geography with low labor costs, such as India, Mexico, the Philippines or China.
BPO is defined as having internal business processes performed by a third-party service provider under a service level agreement (SLA) that specifies performance metrics. The primary objectives of a BPO agreement are to reduce costs while ensuring equal or higher quality of business processes and freeing the client company to focus on its core competencies. At first glance, the decision to move certain processes to an offshore provider with lower overhead seems obvious. However, BPO carries significant downsides, especially the business and compliance risks of giving control over enterprise applications and information to the service provider. Further, working with a remote BPO provider often creates access issues, bandwidth demands and desktop costs that can eat into the savings gained by outsourcing a project.
By implementing an access infrastructure solution, it is possible to mitigate outsourcing risks and reduce the costs of access, bandwidth and desktops by giving a service provider secure access to, but not ownership of, the applications and data needed to perform a business process.
Access Infrastructure Enables BPO
Access infrastructure software provides a solid foundation for outsourcing business processes by giving remote services providers regardless of location, device or available bandwidth secure, costeffective access to managed applications and data. This solution is based on technology that enables applications to be installed, processed, managed, supported and deployed 100 percent on central servers, instead of on individual user desktops. Users receive secure, easy and instant access to these applications over the network. They view and work with the application interface sending mouse clicks and keystrokes to the server and receiving screen updates just as if the application was running locally.
Used as part of a BPO IT system, access infrastructure:
- Secures applications and data;
- Ensures client control over applications and data used by service providers;
- Reduces implementation time and costs;
- Reduces expensive bandwidth costs to offshore locations; and
- Reduces desktop costs.
Securing Applications and Data
The access infrastructure model enables a client company to supply its service provider with access to, but not ownership of, the applications and data necessary to perform the outsourced business process. Applications and data remain securely on the client companys servers and are made available to remote workers based on predefined user profiles. Personnel at the service providers site simply click an icon to view and work with all applications that they are authorized to use. To provision this remote access, mouse-clicks, keystrokes and screen updates are transmitted between the users and the client companys servers. To enhance security, this data is encrypted over the network.
User profiles can be simple or complex as required by the business process being outsourced. A single user can have access to one or more applications or data stores. And system administrators at the client companys site receive a comprehensive view of who, how, when and where systems are being used, so service provider system activity can be tracked and compared to process benchmarks and results as defined in the outsourcing agreement.
Controlling Applications And Data
Client companies using access infrastructure to deliver applications and data to service providers can leverage management tools that allow them to maintain control over assets and monitor and control access. New users and their definitions can be added and ex-users deleted on the fly, an advantage vital for managing service providers performing business processes that experience high agent turnover, such as transaction processing and customer care.
Client company system administrators are provided with a view of when, how and where systems are being used, which enables a client company to evaluate the service providers compliance with its SLA. Even individual user sessions can be shadowed, enabling periodic or systematic quality checks.
Access infrastructure also allows teams to collaborate on mutually accessible documents and applications, even if team members are geographically distant. This capability saves travel time and money, especially when teams are on different continents.
Reducing Implementation Costs
Client companies using access infrastructure to support their business process outsourcing efforts typically realize significant cost and time-tomarket savings because applications and data stay on the clients server to be shared with, but not transferred to, a service provider. Thus, client companies can leverage all of their current computing infrastructure, from networks to desktop hardware, and not pay for the service providers hardware and software.
Since administrators manage and support all enterprise applications from a single location, the client company can rapidly deploy new applications to a service provider, set up or add new offices and users, and integrate new systems in hours or days instead of months. This rapid application deployment dramatically reduces the rollout time of new and upgraded applications, saving the client and service provider time, money and resources. Productivity and, in the case of a call center, customer service are improved, since service provider personnel are always working with the latest applications and upgrades, as well as current data.
Reducing Bandwidth Costs
Many offshore service providers rely on expensive IPLCs for network communications, and reducing bandwidth is key to controlling costs. Because many application architectures rely on data exchange between client device and server to execute a process, bandwidth requirements can be highly difficult to predict and manage.
With all computations and data management done on the server, and only minimal data transmitted between client and server, an access infrastructure system provides consistently low bandwidth consumption, both in compressed and uncompressed data communications. Thus, problems related to accurate prediction and measurement of bandwidth requirements are significantly reduced, enabling a service provider to better manage this element and operate at a lower cost.
Reducing Desktop Costs
If a client company application update is required for certain users, the change is made once on the clients central server and the update will automatically be distributed to other servers across the clients enterprise. These, in turn, will distribute the update to every specified desktop whether at the client or service provider. Additional desktops can be integrated into the system just as easily. There is never any need for special emulation software, changes in system configuration or application rewrites. This feature reduces the need to upgrade desktop hardware.
Access infrastructure software meets the cost control, data security and application access requirements of business process outsourcing. By implementing an access infrastructure solution, a client company and its BPO service provider can improve performance through rapid access to the latest applications and data, keep costs down for a competitive advantage and strengthen the security and control of information.
BPO Case Studies
Maritz Travel
Maritz Travel, a $1 billion global leader in meeting, event and incentive travel management, wanted to outsource the development of financial applications containing customers financial and personal data. To provide secure access to its India-based BPO service provider, Cognizant Technology Solutions Corp., Maritz uses Citrix MetaFrame Presentation Server. All applications and test data reside on servers at Maritz St. Louis, Mo., headquarters and are accessed remotely by Cognizant staff.
Secure Remote Access Makes Offshoring Feasible
When Maritz decided to outsource development and maintenance of applications primarily Oracle financials to India, the anticipated cost and efficiency benefits were overshadowed by concerns about data security and loss of control over the applications.
These applications contain financial and personal data about Maritz clients, explained Maritzs CIO, Richard Spradling. We are an information manager for our clients, and we take that very seriously. We wanted to make sure we lived up to our commitments to protect customer data.
We used MetaFrame Presentation Server by default to support offshore outsourcing because weve had such a good experience using it to provide mobile and remote application access to our travel professionals, he said. It didnt occur to us to use anything else. By deploying these applications on MetaFrame Presentation Servers in the US and making them accessible to the outsourcing company over the network, Maritz was able to ensure data security and retain control of the applications. MetaFrame Presentation Server safeguards application data by keeping processing 100 percent on the server and encrypting the small amount of data that is sent over the network between the server and the client. No live data is accessed by the India-based staff, and test data resides on the US servers. Using Citrix, Spradling said, we are able to give offshore personnel just the amount of access they need to do their jobs and no more.
CompuCredit
CompuCredit, an Atlanta-based direct marketer of branded credit cards, has 2.4 million cardholders and receivables of $2.34 billion. The company supplements its US collection and customer service call centers with offshore operations in India and Panama. CompuCredit implemented Citrix access infrastructure to cost-effectively support these dispersed centers. Citrix enables the company to centrally deploy and support applications required by call center employees regardless of location and to safeguard confidential customer information. According to CompuCredit CIO Mark Lawrence, We are comfortable with our offshore security and compliance issues because what is displayed on users screens doesnt reside on their network. They cant print locally and they cant transfer data to their hard drive.
Conclusion
Due to technology advances and service providers increasing sophistication, moving business processes offshore is now feasible at lower costs without sacrificing quality. Early adopters of BPO are realizing cost savings and thus enhancing their competitive advantage. With service providers like Accenture and other leading SI organizations establishing offshore operations, BPO is becoming mainstream.
However, moving business processes outside an organization creates business exposure due to a number of compliance issues and can add additional costs to what is essentially a cost-cutting measure. These issues can be resolved by allowing a service provider with secure access to, but not ownership of, the applications and data necessary to deliver the service.
As part of an on-demand BPO IT infrastructure, the Citrix MetaFrame Access Suite enables an organization to outsource noncore business processes and cut operational costs without compromising data security and confidentiality and application investment.
