As Published By: NASSCOM
This blog is authored by Rajesh Subramaniam, Managing Director & CEO at Firstsource Solutions. Listen to him at NASSCOM BPM Strategy Summit 2017
Time to transform: how Indian BPMs can build customer-centric enterprises with transformational technologies and capabilities
The global BPM landscape is now more competitive than ever before. Increasing client demands, new technologies and emerging players all mean outsourcing providers need to find new ways to differentiate themselves and stay ahead.
While these factors are influencing BPM providers across the world, as one of the biggest players in the sector, Indian companies in particular are feeling the pressure. India has long been a popular destination for providing smart and value-driven customer experiences however; this landscape is changing as the BPM industry moves from a traditionally cost-effective, labour-intensive sector to a technologically-driven industry. Earlier investment in infrastructure may now be undermined and underutilised due to greater spend being poured into technology. As a result, many fear that India could lose its ranking in the customer service league tables. Thankfully the reality is not as bleak. The emergence of new technologies could in fact be an inflection point for the Indian BPM industry if the industry can display the maturity to turn it to its advantage.
The technology opportunity
The ideal way to approach this challenge is to focus on the transformative power of technology for customer service. This can be done in a number of ways, from integrating new digital touch points such as messenger and chat bots, to incorporating cognitive automation into our processes. These are inextricably linked. At its core, Robotic Process Automation is the application of a computer software or “robot” to process transactions, manipulate data or trigger responses, depending on the scope of the request – and is well suited for both front- and back-office processes.
The RPA technology has the potential to unlock value across a wide range of different industries and business functions. It can provide more customer-friendly, cost-effective and compliant processes in industries from telecoms to healthcare, financial services to travel. But does this sound too good to be true?
Man versus machine?
Understandably, cognitive automation has its pitfalls. Many think of the process as a case of man versus machine. This fear is felt particularly strongly in India, which has always been at the forefront of the transactional front- and back-office work – the tasks most likely to be automated in the near future.
But this reaction is myopic and unwarranted. The past decade has seen a gradual shift of front-office work being transferred from India to the Philippines, or being lost through re-shoring. However with the influx of new technologies, such as chat bots, messaging, self-serve and interaction analytics, there will be a reduction in front office volumes. The back-office processes will make increasing use of RPA, machine learning and AI, which will further change the BPM landscape in terms of resource and skill requirements.
Clichéd as it may be, change is the only constant. We live in an ever changing world and we don’t have to go too far to experience it. Look at the consumption trends around the world – both in terms of data and retail. Can we really believe that the world we lived in – in terms of consumption standpoint in 2007 is the same as 2017? By merely looking at this data over the last one decade, the changes that we have gone through become stark and evident. The myriad of opportunities in this ever-changing business environment and competition bodes well for the scale of higher end demand of BPM services and this as an opportunity will play itself out.
Far from cutting jobs, RPA will take on the manual tasks and give way to far more jobs at the higher-end of the work ladder, in areas such as analytics and customer journey design that match the skill availability and aspirations of the India workforce. Machines won’t replace humans, and the future of customer experience will never be about universal automation. Freeing employees from repetitive manual work opens up the organisation’s bandwidth to focus on value-added tasks. Indeed, it’s through these tasks that the battle for customer service is won or lost.
As a result, Indian BPMs are at a crossroad. By taking the route of transformation, India can stay one step ahead and maintain its place as a leader in the space.
The crossover to cognitive automation of customer service will be gradual and won’t happen overnight. Technological transformation is a big undertaking, from both a financial and staffing angle. Furthermore, new technologies are not time-tested. Clients and technology experts have their doubts and diverging views about capabilities, and often want a tried-and-tested solution.
But those BPMs that commit to experimenting now will reap the rewards down the line. While initial revenue growth in the short term may be slow, the value creation from a customer experience perspective will be invaluable and will offer clear advantage to the first movers. The new technologies are already working well however it will still take time to integrate completely. This gives India a lucrative time window to adopt and prepare for the change.
And we already have many advantages. The strength of our education system, high tech literacy in the young workforce, and the technological infrastructure in place across the country means we are in the right place to capitalise on the current situation.
Beyond this, we are witnessing a gradual change in terms of organisational structure, from a traditional pyramid shape through to a diamond structure. This encourages more effective organisational change, and gives Indian BPMs further opportunity to make the most of today’s transformation landscape.
A leap of faith
The onus now is on Indian BPMs to accept the change and be at the forefront of the cognitive automation and digitization opportunities. While the fear over potential job losses due to RPA is understandable, key to mitigating this is through up-skilling and re-skilling of the workforce.
There are practical steps businesses can begin taking on their transformation journey. Building a strategic plan that encompasses a three to five year outlook, including the skill set requirement needed to follow through, will form the backbone of the journey. To build on their credentials in the technology space, companies can also plan targeted acquisitions, absorbing know-how and skills along the way. Investing in incubators will further build new skills, and help establish them as a forward-looking, innovative leader in the sector.
From Siliguri to Silicon Valley, Indians have displayed their ingenuity, creativity and business acumen when it comes to entrepreneurship. India offers a thriving ecosystem to unleash the entrepreneurial spirit that promotes our unique ability to dream big and above all persevere to see it through. To paint a picture, VC and PE investments have moved from $ 4.5 billion in 2009 to a whopping $23 billion in 2017. I rest my case.
There is no doubt that technology will be a transformative force for customer service. In order to be truly competitive, BPMs will need to take the plunge and embark on their own transformative journey. The key to success lies in finding the right balance between the humans and the robots – an unbeatable combination.