Premise of existence of BPO companies can rest on 2 key factors
- companies want to focus on core competence and would outsource processes and activities which could be done by an external agency at better efficiency and save on capital investment and extended operations
- cut cost by relocating operations to lower cost locations, specifically manpower cost as the differential in wages compounded by the volume of people involved build a compelling business case
With changes in customer behaviour influenced primarily by technology and new concepts and dynamic demography and psychography it is very likely the traditional modes of availing of customer and vendor services will fall by the wayside
As more and more consumers use Internet and Internet on mobile devices, the propensity to call up a call center for support will fall dramatically. Moreover people find it easier to report a problem, order a product, make changes to an order online than they do it over phone (where you have to go through 10 hoops to reach to a relevant section and then wait in Q to be served)
3G and innovative mobile applications will cut down the need for people to rely on phone and direct audio conversations.
This transformation does not imply that BPO companies will go out of business, but it does underscore a compelling need to shift the operations and competencies in areas where business services will provide value to the customers. This include
- Investing in building competencies around specialized areas and domains
- Building up analytics practice, since cost of manpower will not be a driving factor as the volume of people needed to run back office will scale down significantly
- Making a sense of how web, 3G and new technologies and trends are impacting customer/consumer behavior and building service offerings around those
This will not happen in bottoms up approach but the management and leadership of the companies would have to have a sense of "market trajectory" and where it is headed and stay ahead of the curve.
Difference between a strategic and reactionary approach will be that of a leader to a laggard!
Friday, January 29, 2010
Thursday, December 24, 2009
Apple is no feast!
Apple will be the new generation technology company and will lead the pack. As the new ideas and concepts and technologies take root, devices and enabling hardware and software will go through the transformation. HP, Microsoft, LG, Samsung, Sony and Nokia will relinquish their no 1 positions in many areas to Apple and new players (who are not in horizon today). Companies like Dell, Motorola and some others might just vanish in thin air, without a trace
The basis of argument -
- is not innovation - Apple hardly comes up with a new product or service, it just makes them better and not just better but better beyond imagination - a delta that no other company can leap frog
- it is quality and user experience. It creates an experience that become benchmark of excellence
- it is the culture and core values, that are easy to write on a piece of paper but nearly impossible to cultivate, nurture and soak in every aspect of the organization
Market tsunamis created by alliances, mergers and acquisitions and other Wall Street maneuvers can never destabilize an organization where the culture of creating quality products is so deep rooted. Though it is seen as a one man show now with Steve Jobs but I believe that it will pull along just fine even after him as long as they do not have any wall street type as the CEO and the leadership preserves the "nerdiness".
Technology companies can never be successful by basing their operating models and strategies on what Wall street likes to see as it mostly likes numbers and graphs that look simple to comprehend and make sense of. Dancing to Wall street tunes can bring an end to an otherwise spectacular endeavor - look what happened/happens to Google.
When you have people leading a company who think like investment bankers you will find it hard to sustain in the technology echo system that give two hoots to ROI/ROE/ROA and any other R there might be. Technology companies make hell of a money by making good solid products, which are created as a result of excellent ideas and excellent ideas rarely comes to people who spend their life looking at tickers.
Transformative ideas comes to innovators and nerds, a species that only fellow nerds understand hence it is important to have nerds leading a technology company whose survival depends on innovation. The day men in black take over the dark era dawns.
So coming back to Apple - it will kick butt of established businesses as it continues to blaze on its product/platform leadership trail. As of now no company seem to have the configuration to give it a run for money. All the talk about Android and Google phone is going to be nothing but media frenzy, Google will not come anywhere near. In fact cell phone companies latching on to android are likely to sink with the OS itself
Steve Jobs successor will be a creative genius and not a number cruncher or a sales guy, she/he will be a visionary who can command respect of his team of visionaries
(PS: I did not want to bore you with details of my analysis as I believe it is simple and anyone who has followed technology in last 10-15 yrs will be able to assess, those who have not - this piece will be so out of whack that you may never reach the post script section)
The basis of argument -
- is not innovation - Apple hardly comes up with a new product or service, it just makes them better and not just better but better beyond imagination - a delta that no other company can leap frog
- it is quality and user experience. It creates an experience that become benchmark of excellence
- it is the culture and core values, that are easy to write on a piece of paper but nearly impossible to cultivate, nurture and soak in every aspect of the organization
Market tsunamis created by alliances, mergers and acquisitions and other Wall Street maneuvers can never destabilize an organization where the culture of creating quality products is so deep rooted. Though it is seen as a one man show now with Steve Jobs but I believe that it will pull along just fine even after him as long as they do not have any wall street type as the CEO and the leadership preserves the "nerdiness".
Technology companies can never be successful by basing their operating models and strategies on what Wall street likes to see as it mostly likes numbers and graphs that look simple to comprehend and make sense of. Dancing to Wall street tunes can bring an end to an otherwise spectacular endeavor - look what happened/happens to Google.
When you have people leading a company who think like investment bankers you will find it hard to sustain in the technology echo system that give two hoots to ROI/ROE/ROA and any other R there might be. Technology companies make hell of a money by making good solid products, which are created as a result of excellent ideas and excellent ideas rarely comes to people who spend their life looking at tickers.
Transformative ideas comes to innovators and nerds, a species that only fellow nerds understand hence it is important to have nerds leading a technology company whose survival depends on innovation. The day men in black take over the dark era dawns.
So coming back to Apple - it will kick butt of established businesses as it continues to blaze on its product/platform leadership trail. As of now no company seem to have the configuration to give it a run for money. All the talk about Android and Google phone is going to be nothing but media frenzy, Google will not come anywhere near. In fact cell phone companies latching on to android are likely to sink with the OS itself
Steve Jobs successor will be a creative genius and not a number cruncher or a sales guy, she/he will be a visionary who can command respect of his team of visionaries
(PS: I did not want to bore you with details of my analysis as I believe it is simple and anyone who has followed technology in last 10-15 yrs will be able to assess, those who have not - this piece will be so out of whack that you may never reach the post script section)
Trajectory - first blog
An attempt to gauge trajectory of things that interest me from business to technology to politics and policy...
It is interesting how simple extrapolations go so wrong as trajectory of things in real life does not follow mathematical and scientific models. But there are always signs and pointers which can help predict the trajectory - the key is to identify the right ones among the clutter and then find more and more until you can make sense of it...
To attempt trajectory of current let me put in perspective of what I am attempting by illustrating some trajectories of past
- Who thought that Apple would become the biggest cell phone company in the world in last 2 yrs, by selling only one model and its variations? It was not in phone business at all!
- Who thought that Pakistan will be torn apart by the very same demons it created to torment India and its other neighbors? India did not play any part in it, as it never had the will and wherewithal to take on the demon!
- Who thought that a black man with a Muslim linkage will become President of US? Both are suppose to be insurmountable libalities, which actually turned out to be an asset for an otherwise non-existent track record
- Who thought that some company can make billions out of a search engine and that dot com would again rise like Phoenix within 3 yrs after its spectacular bust?
And there are many more... things that are established facts today sounded like a wild flight of imagination some years back...
Speculators make a fortune if their speculations work out, they also become paupers if it does not. A successful speculator will tell you that healthy appetite for risk is not the only factor that makes them click, it is also the uncanny sense of anticipating a trajectory, which defies the most obvious
Though I do not claim to have that uncanny sense of projecting trajectories of companies and markets and nations and individuals but I believe I can sometime take unconventional and non-extrapolated view of things that might be interesting to some people - if not prophetic enough to bet their savings - but amusing enough for casual reading!
It is interesting how simple extrapolations go so wrong as trajectory of things in real life does not follow mathematical and scientific models. But there are always signs and pointers which can help predict the trajectory - the key is to identify the right ones among the clutter and then find more and more until you can make sense of it...
To attempt trajectory of current let me put in perspective of what I am attempting by illustrating some trajectories of past
- Who thought that Apple would become the biggest cell phone company in the world in last 2 yrs, by selling only one model and its variations? It was not in phone business at all!
- Who thought that Pakistan will be torn apart by the very same demons it created to torment India and its other neighbors? India did not play any part in it, as it never had the will and wherewithal to take on the demon!
- Who thought that a black man with a Muslim linkage will become President of US? Both are suppose to be insurmountable libalities, which actually turned out to be an asset for an otherwise non-existent track record
- Who thought that some company can make billions out of a search engine and that dot com would again rise like Phoenix within 3 yrs after its spectacular bust?
And there are many more... things that are established facts today sounded like a wild flight of imagination some years back...
Speculators make a fortune if their speculations work out, they also become paupers if it does not. A successful speculator will tell you that healthy appetite for risk is not the only factor that makes them click, it is also the uncanny sense of anticipating a trajectory, which defies the most obvious
Though I do not claim to have that uncanny sense of projecting trajectories of companies and markets and nations and individuals but I believe I can sometime take unconventional and non-extrapolated view of things that might be interesting to some people - if not prophetic enough to bet their savings - but amusing enough for casual reading!
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