via Welcome to Smart Enterprise Exchange: Outsourcing Wisdom: 9 Global Services Trends for 2012.

Worth reading. One of the “Built to Last” firms.

Think it is right to kick off 2011 with some resolutions. Suggest buyers look at these too since they can do the same!

“Colombia is Passion” is the brand the Colombian government at the helm at pro-export chose to brand the nation.  What one soon discovers in this beautiful country of beautiful people is a passion for business, music and family.  One also soon realizes that a passion for outsourcing already exists here too!

Colombia is a rising star in Latin America. Once perceived to be unsafe, the country has, over the last decade, transformed itself as one of the best locations to do business in Latin America, ranking higher by the World Bank in 2010, than countries such as Peru, Panama, Brazil, Chile and Mexico.

Citi, Henkel, Wyatt, Abbott and HP have captive centers here that serve as regional centers. International firms such as Telefonica, Telmex, Avianca, Greyhound and Tracfone leverage outsourcers such as Telemark, Teleperformance, Assenda, Avanza, Unisys, ACS and IQ Outsourcing.  Domestic firms such as Carvajal, Bancolombia, Suramericana, Banco Agrario and even the Colombian government are not much behind in leveraging outsourcing. Interestingly, Bancolombia leverages not just local suppliers like Assenda but also leverages global suppliers such as ACS, TCS andInfosys.

ROOM FOR IMPROVEMENT: While the country has a large population, the level of maturity of ITO and BPO operations is limited. No CMM 5 providers or six-sigma black belts are found easily. Call center operations are advanced but process discipline in other business process needs scale. So, if you are going to setup or outsource here, suggest that you invest in ongoing training and process discipline.

What makes Colombia such a passionate adopter and attractive destination for outsourcing?

A country with a population of 46 million with outsourcing friendly labor pools in multiple cities such as Bogota, Medellin, Cali, Baranquilla and even Periera, presents multiple options for buyers and suppliers. Thirty cities have a population of 100,000 or more.  Bogota produces 67,000 graduates every year, of which, 17,000 are technical graduates. At present, the combined workforce of IT and BPO industry in Bogota exceeds 50,000.

Labor costs in Colombia are very attractive with Bogota being one of the least expensive cities in the region. Labor cost for bi-lingual while higher than Spanish speaking employees, is 15-25% lower than comparable employees in Monterrey or Buenos Aires. Real estate costs are lower too than Mexico City and Sao Paulo.

More …. at Nearshore Americas

Here we go again!  Another politician working on making America less competitive and forcing American companies to have more disadvantages as they compete globally.

Jobs are not created by putting more hurdles in front of companies. Jobs are created by providing incentives for companies to invest in communities and new opportunities.

Has anyone done a study of how many jobs are being created by foreign outsourcing companies in the U.S.A.? Has anyone done a study to see what impact outsourcing is having on the fortunes of the buyers?  Are they competing better and thus creating more jobs and better futures for their employees?

We are lot more connected than when most of these politicians started their careers.   They need to spend more time understanding the connectedness of our world and how one needs to compete NOW!

by Jeanne C Meister and Karie Willyerd  |

If a leader is like a conductor, as Peter Drucker said, then are virtual leaders like virtual conductors? In this video, Eric Whitacre conducts a virtual choir in a performance of “Lux Aurumque.” This moving virtual symphony, a collaboration between more than 185 singers from 12 countries, has been viewed more than a million times since it was uploaded in March.

As Whitacre describes in his blog, “I made my own conductor track, filming it in complete silence, hearing the music only in my head. Then I watched the video and played in the piano accompaniment part to my conductor track. Then I offered the sheet music as a free download. As singers began posting their individual tracks, I called for ‘auditions’ for the soprano solo.” Whitacre had already created a different video, called“Sleep,” where he cut different tracks of remote singers together. The goal with “Lux Aurumque” was to have the singers — none of whom could hear each other, of course — actually responding to his direction.

“There is a lot of rubato in my conducting (slowing down, speeding up) and some very specific dynamic gestures. And the singers responded beautifully… When I saw the finished video for the first time I actually teared up. The intimacy of all the faces, the sound of the singing, the obvious poetic symbolism about our shared humanity and our need to connect; all of it completely overwhelmed me.”

If a conductor can work virtually, bringing over 100 musicians together in a way that recognized the individuals even more than a live performance might, what can virtual managers do to create such excellence of performance while touching our “shared humanity?”

The reality of virtual leadership is apparent. Teams are increasingly spread across space and time, providing the benefit of obtaining talent anywhere in the world and allowing 24-7 work progression. However, virtual workers can feel a sense of isolation, and building bonded teams becomes more difficult when there are few opportunities to meet face-to-face.

Bob Taccini, a 52-year-old vice president of finance at Cisco Systems, has faced this situation personally. Although self-described as one of the last people to adopt a new fad, he says, “When we cut our travel budgets, using social technologies helped meet my need for personalization with my team. Even when I had a travel budget, I could maybe only get to some of our sites once a year. Management now requires spanning distance, even though we can’t span time. Certainly, as we continue to build a multi-generation workspace, social technologies will become more and more the norm.”

For Taccini, the last five years — marked by constantly changing market conditions, the introduction of more distributed leadership throughout Cisco, and the increased availability of virtual meeting technologies — have demanded a change in how he leads. During this time, he has become an adept user of social technologies. Now he conducts virtual offsite meetings, using TelePresence and WebEx, with blogs, discussion groups, and online forums as needed. TelePresence is richer than e-mail or voice mail and feels more real and physical because participants are able to see the other people involved.

One of the most effective tools Taccini has used is a monthly video blog (vlog). “It has been one of the best ways to communicate, supplemented by calls with everyone in my reporting chain,” he said. “Even though it’s not two-way real time, I get more participation from the vlog. My team sends questions, and they also have Web spaces to create collaboration spaces.”

Here are some tips of how leaders are using social technologies to work virtually:

• Rich media, such as live video streams or virtual meetings, can make virtual interactions feel more realistic;
• Frequent contact keeps connections to virtual workers fresh;
• Mixing media, such as the use of forums, vlogs, blogs, and discussion groups allows people to interact in a style most comfortable to them
• Meeting face-to-face at least once helps create a bond that can be connected virtually;
• Simple technologies, such as a personal phone call can help motivate a virtual worker, knowing they are not out of sight, out of mind.

Surely many of you are facing this new world of either working or leading virtually. What has worked for you? What do you wish your manager/team leader would do to help you feel more connected to the rest of the team? Share your experience here so we can learn collectively on how to build a high-performing virtual team.

Jeanne C Meister and Karie Willyerd are cofounders of Future Workplace. Jeanne is the author of two books on corporate universities and hosts the blog newlearningplaybook.com. Karie was formerly the chief learning officer of Sun Microsystems and head of learning and development at HJ Heinz. They are the authors of the HBR article “Mentoring Millennials” and the book The 2020 Workplace: How Innovative Companies Attract, Develop, and Keep Tomorrow’s Employees Today.

Global Sourcing Forum GSF caters to the needs of senior business and sourcing executives charged with leading their organizations through change during an economic period that has undergone significant structural shifts.Over the last decade GSF has become the leading conference for outsourcing and globalization that goes beyond the common issues to provide insights and advice on improving competitiveness and increasing profit margins through strategic outsourcing. It provides a unique opportunity for decision-makers and management to evaluate strategic options, leverage global sourcing models and gain best practices knowledge from experienced practitioners and thought leaders.

via Global Sourcing, Outsourcing, Offshoring Strategies |Global Sourcing Forum.

I have been working with CIOs since 1991 and have come to admire many of them. CIOs at Applied Materials, Ron Kifer and Jay Kerley; CIO at Family Dollar, Joshua Jewett; CIOs at P&G, Fedex and others are not just senior leaders, they are helping transform their firms. They are leading key initiatives.

While the articles has good pointers for CIOs on how to better evolve their future careers, wish they had talked to one of the above to show how many are already doing it!

Author – Atul Vashistha

Making globalisation work: Do the communications right!.

Making globalisation work: Do the communications right!

BY Atul Vashistha
Communicating effectively with your internal and external stakeholders is an important part of successful globalisation initiatives.  That’s important because opinions, if they become negative, can turn into behaviours that threaten to derail an initiative.  Positive opinions, on the other hand, can turn into behaviours that contribute substantially to an initiative’s success.

Internal communications
When communicating with internal stakeholders (including all of your organisation’s employees, from the C-suite to the frontlines), focus on goal, path and potential outcomes and follow these five best practices:

1. Begin your communication early: Start at the onset of your initiative-planning phase.  Then, communicate often.  Most successful globalisers have periodic briefings about the progress of the initiative as well as ad-hoc proactive communications.
2. Resist empty communication: When organisations try to communicate, but don’t really end up saying anything concrete, the outcome can be worse than not communicating at all.  When you communicate with your employees, you raise their expectation that they will learn about how the globalisation initiative will affect their future; don’t let them down. They’ll learn not just about why it’s important to the firm but also the WIFM (What’s In it For Me).
3. Forget persuasion as the primary objective: Your principal goal in communicating potential outcomes to your internal stakeholders is not to bring them over to your way of thinking; it’s to help them understand the importance of the initiative to the company and how they will personally be handled.  Instead of trying to persuade your employees, let an “opinion leader” – a leader within the company who’s well respected and trusted – speak of the initiative and its potential outcomes. Trust and open communications is key.
4. Be honest: Of course, you want to position your globalisation initiative in the best light.  But resist the temptation to sugar-coat potentially negative outcomes for your employees.  Instead, communicate the whole range of possible outcomes – both positive and negative and how you intend to handle it.
5. Cascade messages: Allow a variety of people to be part of communicating your message to the organisation’s internal stakeholders.  The CEO, HR managers, line managers, and business unit heads are all good candidates for the job of communicating with your employees.

External communications
No less important than an organisation’s internal stakeholders are its external stakeholders.  There are two potential problem-points for your company’s external relations: the perception of the general public and the experiences of your customers.

Clearly, managing customers’ experiences is critical to a company’s success.  But managing the perception of the general public is critical, as well, as public perception has a lot of power to fuel customers’ buying decisions as well as political pressure on domestic organisations.

In the public realm, globalisation, outsourcing, and offshoring have once again become four-letter words.

And in the customer sphere, there has recently been some backlash against companies that have globalised services, as some customers have experienced service issues associated with offshore centres (call centres, most notably).  Some enterprises have even begun to scale back customer-facing offshore operations as a result of the negative customer feedback. But overall the industry continues to grow.

Yet reining in global services operations is not the only – nor likely the best – answer.  If services globalisation were better communicated to organisations’ external audiences, it would likely be met with a higher level of acceptance.

That’s E-Loan’s philosophy, and it has paid off well.  In early 2004, the online lender launched an offshore outsourcing pilot programmeme for its back-office processes.  In keeping with the company’s “honesty is the best policy” stance, the company discloses the details of its offshore programme to its customers before they complete their applications, and gives them the option of opting out and instead having their application processed domestically.

According to E-Loan’s Chief Privacy Officer, 87% of the organisation’s customers choose the offshore option, for the faster processing it provides.  “The results of our programme support the idea that when you make the effort to explain the ‘what, where, and why’ to consumers, they are comfortable with it.”

Effective communication requires strong commitment from key management and a deliberate, well thought out strategy to address the concerns of internal and external stakeholders.  The reward for getting the communication part of the initiative right is that internal and external stakeholders will help propel the initiative forward, rather than conspire to hold it back.

I’ve
said before that a company that wishes to flourish in today’s global market
must adopt a services globalization strategy. But not every company is ready to
globalize every process today. A successful services
globalization strategy takes diligent planning and thought—and that takes time
and focused effort.

In
the last chapter on adopting a lifecycle approach (Secret #3), we talked about
answering the following questions: Should
the organization globalize? Why will
the organization globalize? What will
the organization globalize? When will
it globalize?

The
last two questions are more operational than strategic; the first two—about why
the organization is globalizing and if it even should globalize, are purely
strategic. In answering those strategic questions, an organization must look at
globalization in relation to its overall business strategy. This is the fourth
secret: Align business and globalization objectives.  If the two don’t align, the organization is wasting its
resources and should not globalize.

When
talking about GE’s globalization strategies, former CEO Jack Welch, arguably
one of the best strategists of modern business and a highly successful
globalizer, says “If GE's strategy
of investment in China is wrong, it represents a loss of a billion dollars,
perhaps a couple of billion dollars. If it is right, it is the future of this
company for the next century.”

Not
every organization will risk billions of dollars in its globalization strategy,
but each runs the risk of unsuccessfully globalizing and missing out on the
opportunity to complement business strategy with globalization. In order to
successfully leverage services globalization—to “be right” in globalization
decisions—organizations must ensure that their globalization strategy is driven
by and aligned with their business strategy.

The
sections that follow aim to offer insight into the questions an organization
needs to ask when determining if its business strategy and globalization
strategy align.

Is business strategy driving
services globalization? What part of your business strategy does globalization
help you execute?

Ensuring That Business Strategy Drives
Globalization Strategy, Not the Other Way Around

As
services globalization becomes a business imperative for industries from
financial services to health care, companies will be even more inclined to jump
on the bandwagon with their peers. Afraid of being left in the dust, too many
companies globalize without really considering whether services globalization
is right for them—and whether their particular approach to services
globalization is the best one.

While
it’s true that services globalization is becoming a business imperative and
should receive due consideration from executives at every organization,
services globalization is not a one-size-fits-all proposition: the way Company
A executes its global strategy will not necessarily work for Company B, just as
the reasons for Company B to globalize are not necessarily the same as Company
A’s reasons.

In
other words, too often globalization initiatives are taken on with no real
strategy at all. Or an organization allows its globalization strategy to drive
its business strategy. Successful globalizers, in contrast, develop very clear
globalization strategies before setting one foot out the door, and those plans
are driven every step of the way by the corporate strategy.

Applied
Materials’ Group VP and CIO Ron Kifer says that aligning business and
globalization objectives is really about securing the future for the company.
“Your business strategy should be the primary driver of the globalization
strategy because globalization doesn’t happen in isolation. If you look at what
Applied Materials is doing with globalization, we’re all-around optimizing
performance and focusing on the core, critical competencies of the
organization, the cost-effectiveness of the solutions closer to our customers,
and that means a different geographic footprint.”

Successful
globalizers thoroughly assess their business process portfolio, financial
state, goals, objectives, risk and transformation needs, as well as the
supplier landscape and market capabilities in provider locations. Using
information from those assessments, successful globalizers build a
globalization strategy that includes the following elements:

§  Future proofing

§  Risk management

§  IP protection

§  Transformation

§  Service extension

§  Resource redeployment

§  Innovation management

Armed
with a globalization strategy, successful globalizers develop an execution
roadmap, which includes:

§  Geographic placement

§  Ownership model

§  Third-party supplier relationships

§  Transition timing

§  Financial return

§  Governance organization

Case
Study: Too Much, Too Fast

One
S&P 100 global investment bank offers a good example of a company that did
not allow its business strategy to drive its globalization strategy. Instead,
perhaps eager to jump on the bandwagon of financial services firms adopting
services globalization, the company globalized too much, too fast.

The
organization globalized its application development, application support and maintenance,
IT infrastructure management, and internal IT help desk all at the same time.
Overloaded and lacking a clearly defined globalization strategy, the investment
bank began to experience performance and quality issues with its offshore
internal IT help desk services.

To
remedy the problem, the organization had to backtrack, taking steps that it
would have been wiser to take initially, including securing buy-in from key
client stakeholders, providing for effective knowledge transfer, and building a
well-planned, solid governance framework. After taking those steps and
determining that its newly defined services globalization strategy did follow
its overall business strategy, the company was able to successfully resume its
initiative.

Having a Clear Idea of the Part of the
Business Strategy That Globalization Will Help Execute

In
addition to aligning its globalization strategy with its business strategy and
ensuring that it is the business strategy that’s the driver, the successful
globalizer has a clear idea of what part of its business strategy globalization
will help execute.

Former
Lenovo CIO Steve Bandrowczak explains that globalization is not just for the
sake of lowering costs. "We were lowering costs not because we were not
competitive in the industry. We were lowering costs because our stakeholders
expected it and competition demands it. You keep getting back to what are the
strategic objectives of your business.”

Bandrowczak
added that in his staff meetings, the alignment between globalization and
business strategy was crystal clear. “If you had sat in my staff meeting, we
didn’t say ‘Okay we’re going to shut two data centers down and we’re going to
save three centers.’ Instead, we said ‘We’re going to improve our
expense-to-revenue ratio from an IT perspective because we’re going to get in
line with industry standards and we have to deliver $100 million to the bottom
line of Lenovo.’ You constantly have to keep tying your global initiatives to
those business and strategic directions.”

Case Study: Lack of Clarity and
Definition

A
Fortune 500 electronics company provides an example of an organization that did
not develop a clear idea of the part of its business strategy that
globalization would help execute before beginning its globalization initiative.
As a result, the organization encountered a number of (avoidable) problems.

The
company initially decided to offshore its corporate business customer service,
retail customer service, levels 1, 2 and 3 customer support, order processing,
accounts payable and receivable, and order-to-cash processes to third-party
suppliers as well as a captive center in India and the Philippines.

Once
the initiative was underway, the electronics company found significant
performance and quality issues with corporate business customer service
processes within its captive center. Additionally, the ramp-up of higher-end,
customer-facing processes was slower than the company had originally expected.

After
analyzing the problems that had occurred within its services globalization
initiative, the organization realized that its fault lay in not fully analyzing
its portfolio of processes to understand the fundamental what, when, where and
how questions that services globalization requires. Additionally, the company found
that its fragmented processes needed to be aggregated and that an effective
transition needed to be based on a detailed analysis of processes.

This
Fortune 500 electronics company responded to the deficiencies it found in its
services globalization rollout, re-planned the initiatives by answering those
critical what, when, where and how questions, and developed a clear picture of
how globalization would help the company accomplish its business objectives.
Now it has very successful offshore operations. 

Case Study: Leading with Strategy

A
Fortune 500 health and life insurance company provides a good example of the
strategic considerations a company might make at different levels of the
organization. This company had a very fragmented and inefficient life claims
process, with no existing manuals or desktop procedures. Each examiner had his
or her own version of the process and method for calculating claim amounts.

In
addition, the organization was bogged down in paper-based calculations that
were full of errors with no audit trail. Furthermore, process
output/productivity, accuracy, and efficiency were not tracked. As a result,
the firm was unable to leverage its systems and knowledge to compete in the
market against new players.

This
organization resisted the urge to adopt services globalization as a fix-it
solution to its inefficiencies. Instead, it considered its strategic goals and
how it could accomplish those goals with an aligned services globalization
strategy. Each executive team member contributed in a different way to the
strategic development: the CEO had a strategic focus, concerned with leading
the business into the future; the CIO took a performance focus, concerned with
flexibility, productivity, guaranteed services levels and proven technology.
The CFO took a bottom-line focus, concerned with reducing current costs and
managing future costs.

Instead
of using services globalization as a substitute for sound business strategy,
this Fortune 500 health and life insurance company used a well-developed
services globalization strategy to complement its business strategy, which was
geared in part toward overcoming several process inefficiencies.

Atul
Vashistha is Founder & Chairman of Neo Advisory (formerly neoIT), a leading
management consultancy since 1999, focused on independent, objective and
actionable advice to enterprises that seek to transform their organizations by
capitalizing on outsourcing and globalization. He is also Founder of Neo Group,
a firm focused on managing, monitoring and improving supply relationships.  His latest venture is
BestOutsourcingJobs.com, an online job portal focused on outsourcing careers.
He can be reached at atul@vashistha.com.