Provisioning: perfect for BPO

The provisioning function fits the BPO model perfectly. There is very large scope for automation and process improvement, and execution remains invisible to end customers.

Not only does using BPO deliver a variable cost provisioning solution, but also large telecom carriers have seen internal costs tumble. Reduced HR management costs, sharply lower recruitment and training costs, and cuts in administration time contribute to enhanced business productivity. Executives are able to focus on customer facing initiatives and market competition, safe in the knowledge that the provisioning function is securely, reliably and efficiently handled.

BPO providers have a direct interest in service improvement, too. For example, a perfect provisioning service would ensure an exact match between subscribers and lines, reducing costs and maximizing revenues. By treating provisioning as an external service, with clear targets and performance related incentives, constant reductions in operational costs can be embedded in the business plan. For example, savings generated by specific targets for identifying and cancelling unused circuits will contribute directly to the bottom line.

BPO in action

Until now, the perceived risks in outsourcing the Enterprise Provisioning function have restricted the number of BPO contracts. The need for ultra reliable operations combined with very high levels of technical competence created high barriers to outsourcing the provisioning function.

Based on data from several telecom companies who self provide Enterprise Provisioning services in a traditional way, it is clear that the BPO model has the ability to greatly improve service.

For example, by outsourcing Enterprise Provisioning, SLA compliance can be increased from 50% to over 90% and productivity improvements of on average 25% can be expected. In addition, BPO means Enterprise Provisioning moves from a fixed to a variable cost model, with cost reductions up to 50%.

Telecom carriers continue to budget for large provisioning departments, which are periodically flooded with work followed all too frequently by periods of under-utilization. Carrying in-house departments tends to reduce the bottom line, and such departments are typically inflexible: both hard to staff up and difficult to reduce in size.

Moving to variable costs

Outsourcing the provisioning function delivers three key business advantages - reduced absolute costs, increased service capacity, and a variable cost business model.

The lower absolute costs offered by emerging economies are enhanced by specialization. By focusing exclusively on provisioning, outsourcing companies can concentrate their expertise, enabling them to find new efficiencies and leaner processes that might otherwise be overlooked.

With the concentration of expertise comes increased service capacity from a large pool of talented, trained and experienced engineers and this resource is greater than any individual telecom operator could reasonably support. When workloads rise for any particular customer, additional staff are immediately available.

Most importantly, Enterprise Provisioning capabilities are purchased as an on demand, variable cost service defined by service levels and volumes rather than supplied as a fixed cost, dictated by available in-house resources. If workload declines, costs consequently decline.

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