Infrastructure Considerations and Challenges

I learned that there are 4 varieties of infrastructure and these are:

• Hardware infrastructure 
• Software infrastructure 
• Knowledge infrastructure
• Training and support infrastructure

Hardware Infrastructure

We need to consider in hardware infrastructure underlying the BPO project of whose systems to use.

Despite this common circumstance, the decision to use the vendor’s hardware system should not be based on technology maturity alone. Buyer and vendor must also consider other factors when determining whether to shift processes to the vendor’s hardware.

There are also three critical considerations regarding with the decision of whose system to use.

• Intent of the BPO agreement 
• Buyer’s interest in developing and retaining new capacities 
• Location of the systems

Outsource primarily to save costs should leverage the vendor’s systems. BPO buyer’s interest in developing and retaining new capacities in the outsourced process is “of whose hardware to use in the BPO project”. When a BPO buyer decides to use the vendor’s hardware, that hardware is often located off the buyer’s site.

There is a need to Conduct an Infrastructure and Architecture Audit for us to be able to imply the following:

Avoid needless duplication of systems and services.

Pinpoint gaps in infrastructure capability.

Ensure infrastructure/business alignment.

Ensure adequate scope of information technology (IT) components to accommodate service enhancements.

Assess security issues associated with data and knowledge sharing over networks.

Re-engineer processes that are obviously inefficient or anachronistic.

Software Infrastructure

I learned that if there is a greater gap between buyer and vendor software maturity, the greater the challenges in database integration and data sharing. It is reasonable that the burden will be on the vendor to manage database integration.The cost, however, is likely to be borne, at least in part, by the buyer.

Knowledge Infrastructure

Knowledge infrastructure refers to the practical application of the analyzed data and information.

I also learned what is the difference between Data & Information and Knowledge. Data and information are generated by raw transactions. Knowledge is generated by analysis and reflection on aggregated transactions.

Training and Support Infrastructure

In developing a BPO-related training and support, there are factors that organizations need to consider:

• Developing a clear set of standard operating procedures (SOPs) 
• Training programs that revolve around the SOPs 
• Conducting multiple training sessions: 
• Train in a group setting. 
• Train while working alongside employees during their workday. 
• When answering questions, always refer back to the SOP. 
• Final training should be completed after 60 days (refresher). 
• Not taking training lightly

Managing BPO-Related Change

        Change is intrinsic to the BPO transition stage. It presents organizations with opportunities that must be maximized and risks that must be avoided.As such,the transition must be carefully managed through a far-reaching project management plan and a strategy that respects the roles of leadership and management;the need for honest communication with employees; a recognition of the indirect impact BPO can have on non-affected business processes; an appreciation of the lingering fears and concerns that can occur during job loss and management changes; and the value of establishing and maintaining business continuity.

       The impact of these changes is further complicated by the arrival of a new relationship between BPO buyers and vendors. Like the transition itself,this must be carefully managed,and can be mastered only through an ongoing focus on business benefits expected by both parties.This requires negotiation,communication,and business skills,and must be characterized by trust and the alignment of values. By understanding and pursuing the fundamental traits of a successful BPO relationship,buyers and vendors can make the critical decisions necessary to achieving project success and, potentially, forge partnerships that outlast the current initiative.

        I learned that misunderstanding and mistrust can arise when a BPO buyer initiates a project with a vendor whose organizational culture and operating style are vastly different from its own. Such differences can and often are bridged. But what matters is whether the two firms recognize the differences and take proactive steps to deal with them. Of course, it is impossible to uncover all cultural differences during vendor selection; some will only become manifest in the operating phase.The project management plan should include inducements for each side to identify and detect problems that are a direct result of cultural differences.

          BPO agreements must be designed to provide for adequate flexibility in order to withstand changes in the business environment and the pressures inherent to such a contractual agreement.Typically, contract agreements are crafted on certain key assumptions pertaining to technologies, business conditions, personnel, and other relevant issues. But these assumptions will likely change with time. No matter how detailed the contract or favorable the terms, BPO agreements cannot anticipate all of the changes that occur in a dynamic, global business environment.

Dimensions of a Healthy Relationship

• Flexibility. Defines a bilateral expectation of the willingness to adapt as circumstances change.
• Information exchange. Defines a bilateral expectation that buyer and vendor will proactively provide information useful to each other.
• Solidarity. Defines a bilateral expectation that a high value is placed on the relationship and prescribes behaviors directed specifically toward relationship maintenance.

Relationship Risk Factors:

• Lack of appropriate buyer control
• Cultural differences
• Inflexibility in BPO agreements
• Inadequate SLA specifications and/or metrics
• Inadequate governance
• Lack of goal alignment
• Lack of integration