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June - 2007 - issue > Cover Feature

Tipping Point for Offshore BPO?

Jagdish Dalal
Thursday, May 31, 2007
Jagdish Dalal
Offshore based business process outsourcing (BPO) has been in the news for the past four to five years. Businesses and providers alike are asking whether this represents a ‘mega-trend’ or just a point in the evolution of the globalization of business. In other words, have we reached a ‘tipping point’ in the journey of offshore BPO? Are we there yet?

Malcolm Gladwell in his bestselling book The Tipping Point - How little things can make a big difference describes a tipping point as “the moment of critical mass, the threshold, the boiling point…one dramatic moment in an epidemic when everything can change all at once”. Once we have reached the tipping point, the growth and evolution will be self-fed, much like a chain reaction. For example, the growth of World-wide Web is no longer a question mark; it is self-induced.

So, how does something reach a tipping point? Let me paraphrase some of Gladwell’s observations in his book. In order to reach a tipping point, there are two key drivers: a) a breakthrough, and b) socialization of the concept. Let’s look at the use of the World Wide Web for better understanding.

It is universal and growing exponentially. It illustrates the two drivers mentioned above. The technology for web services is well established, easily available, and is a part of the platform of the new world of technology. There has been, and continues to be innovative processes and solutions; these are introduced by companies large and small and they become the basis for their service excellence. As for the socialization of the concept, there are well published benchmarks for services and service levels. We can look at industry standards for organization of information, access mechanisms and service management principles. We know and emulate best practices. Therefore, we can claim that the World Wide Web has arrived at the tipping point.

A ‘breakthrough’ is the foundation for establishing a business. It can occur through introduction of technology or innovation of a process. When Web-enabled software became available, it allowed distant service providers to access, manipulate, and utilize systems and databases to launch offshore BPO support services. Similarly, advances in telecommunications made communication global and opened up a new world of offshore customer service BPO. So, basic technology has launched offshore BPO as a business solution. Now, the providers have to take that technology to the next level in order to enrich the BPO offering beyond the basic services.

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