BPO Sales Outsourcing and Strategy Solutions. Let us drive your 2020 revenue growth in the United States.
Enterprise Sales Support for CCO, Integrated IT+BPO & BPO Pure Plays
What is your Business Development and Sales team during these challenging COVID-19 times? They should be calling, calling, and building the pipeline for when the commerce machine is turned back on. Today.
Our Business Development and Sales Team for 2019
GroupBDO welcomes Ken Schwartz, Arun Jain and Tom Rocca to the senior sales team.
Our BDO team members drive new revenue streams for you and your BPO organization.We identify, meet, and present to your targeted prospective clients across North America. We bring years of management sales experience ranging from FedEx, American Express, SunGard, Genpact and Sutherland Global. We become your instant U.S. sales team.
Contact us today to launch your successful 2019 revenue growth initiatives.
focus and deliver. everyday.
Our BPO Sales and Strategy Solutions
Enterprise Sales Support for CCO, Integrated IT+BPO, BPO Pure Plays, Digital Operations + Platforms (DOP) and AI and Intelligent Automation Solutions.
Driving U.S. Business Development and Sales to the Office of the CxO since 2007. The Importance of First Mover Advantage.
Now is the time to discuss your 2020 U.S. Sales Strategy.
>Business Development during the COVID-19 Pandemic. This is the time to be calling prospects.
There is doubt that the United States and the world are in a fight with this global virus. But the American economy must also be protected and soon the engine of commerce will be turned on again. During this time of massive WFW (Work from Home) conversion, the end result for sales has never waivered. Call. Talk. Exchange ideas. Set Meetings. Sell. Repeat.
If your sales team is getting a little too relaxed from the home office, let GroupBDO help become a force multiplier to get your internal Business Development and Sales teams swinging for the fences again.
Business Process Outsourcing Industry Overview Spring 2020
What is Offshore BPO?
•What is it? Business process outsourcing(BPO) is when companies contract selected business processes and functions of an organization (i.e., F&A, customer service, analytics, supply chain management) to a third-party provider
•Value proposition –Outsourcing provides opportunities for cost reduction (could be 30-40% cost saving upfront and up to 75% over time) while increasing the amount of time/resources used to grow the “core” part of a company’s business
•Market size –We estimate the ITO/BPO market size to be $1.1-1.2 trillion, with the BPO market ~$330-340B (includes BPO, CRM, and F&A)
•Growth –We estimate mid-/high-single-digit growth over the cycle
•Current state of the industry –COVID-19 will likely have a noticeable impact on outsourced industries (like financial services, manufacturing, and travel), however, this could accelerate the transformation to digital over the long term
How Do Contracts Work?
•Sales cycle –12-18 months•Training –Three months for training/onboarding
•Contract length –Outsourcing contracts typically ~3-5 years and analytics contracts are ~1-3 years. A portion of analytics contracts (~one-third of deals) commonly starts as a project and turn into longer-term contracts
•Renewal rates –typically 90%+
•Termination fees/terms –These vary by company and contract (nothing standard across the industry)
•Annual productivity benefit to clients (acts as price benefit to the client) is ~2-3%/year –This creates stickiness, and we believe also acts as a competitive moat (the longer the duration, the more efficient the BPO provider becomes, and harder to be unseated)
ITO/BPO Market 2019E
•Total IT/BPO market of approximately $1.1-1.2 trillion–IT Outsourcing ~$760-770 billion –We define ITO as IT professional services, IT infrastructure management, and ADM–Business Process Outsourcing ~$330-340 billion –We define BPO as industry-specific BPO, CRM, and F&A BPO–Human Resources Outsourcing ~$55-60 billion
•Robotic process automation(RPA) –Application of technology for automating complex business processes. –Software robots act as virtual workers –they capture and interpret existing applications for processing a transaction, manipulate data, trigger responses and communicate with other digital systems in a way that is usually done by a person or an entire team.–BPO providers can RPA to offer even lower rates by applying RPA to own processes.–Company can use both BPO and RPA levers applied to the same processes.
•Pure BPO potential cost-saving–15% to 40% within five years. The cost savings increase as the outsourced process matures and goes through continuous improvements.
•Cost savings potential with BPO and RPA–50% to 95% according to The National Association of Software and Services Companies (NASSCOM). RPA in BPO assumes an end-to-end driven approach, and integration of predictive analytics to guide decision support.
•Size of BPO Market –We estimate around $330-340 billion, including BPO, CRM, and F&A–India BPO delivery –We estimate ~$35 billion–Rest of World delivery –We estimate ~$300 billion
•Growth–We estimate mid-/high-single-digit YoY growth–India BPO –High-single-digit/low-double-digit yoy growth–Rest of World –Mid-single-digit YoY growth (in line with GDP growth)
Longer-Term BPO Thoughts
•Longer-term thoughts/sentiment–Continued organic revenue growth (mid/high-single digits) •Market expanding nicely–Opportunities are not dependent on competitive wins, as (1) existing clients keep spending more (and renew at high-90% rates), and (2) many clients still new to BPO
•Broadening client needs –Clients are increasingly looking at full redesign plans that can include several-year ramps of recurring BPO services
•Fairly resilient last downturn; however, COVID-19 will be a test –Highly recurring work, and the group has a larger/more diverse client base than 2008/2009 (G grew each year, while EXLS/WNS each had one mild down year due to client-specific issues)
Global BPO / IT Operational Notes and Movers and Shakers
Week ending Friday 29 May 2020
The following BPO & ITO vendors are representative of client profiles that we represent for Business Development and Sales Support Solutions.
THOUGHT OF THE WEEK: What Makes the Cut? IT service providers seem to have stabilized their operations (supply side), and the challenge has now turned to the flow of new business (demand side). Obviously most maintenance work continues (but generally does not grow), so what happens with the project-based, or discretionary spend opportunities? We continue to hear that cloud transition efforts and cyber-security are getting increased focus given the adoption of work-from-home solutions. Most (not all) of digital transformational efforts appear to be moving forward, although this is less true in the more COVID-19 challenged industries (e.g. travel, hospitality, retail, etc.). So we know that the June quarter is to be notably down sequentially, but what will the September quarter look like? We continue to hear of a bottoming by late April, but things are still well below pre-COVID-19 levels. How quickly will project-based spending recover? Which efforts are critical, which are not? Will projects just be pushed into CY21? Our sense is that Street estimates may still be a little too optimistic, but the market is far from clear at the moment, as we note the global economy appears to be determined to get back to some level of “new normal.”
THE WEEK AHEAD:
SAIC, Plus Set Your Clock for 2:00pmET the Next Two Weeks
SAIC (6/4). We look for an in-line quarter. (See our May 19 preview note.) The focus will be more on incremental change in government client behavior.
3rd Annual Wells Fargo IT Boot Camp (5/2-5/16). Starting Tuesday, every weekday at 2:00pmET for two weeks, we will feature an interactive presentation and an open Q&A session with a different senior leader of the Technology, Data Management & Insights (DMI), and Payments, Virtual Solution & Innovation (PVSI) groups of Wells Fargo & Co. This includes the IT/BPO research team hosting a conversation with Courtney Smith, Head of Technology Operations & Services, on Monday, June 15th. Details inside this note. Please contact your Wells Fargo Securities sales representative to register for the event.
WHAT WE LEARNED THIS WEEK:
Booz Allen (BAH, 5/26). FQ4 (Mar.) saw 11% organic growth with an expectation of 6-10% for FY21.
DXC Technology (DXC, 5/28). Reported FQ4 (Mar.) where non-GAAP EPS was supported by a negative tax rate. FY21 indicated as another year of ~$1B client revenue run-off. FQ1 (Jun.) expected to be down 8-10% sequentially. Their regular dividend was suspended in the next step to improve liquidity.
Infosys (INFY). The offered commentary that was generally positive (especially on the supply side), but highlighted uncertainty about new awards and more so project ramps.
Leidos (LDOS, 5/28). Collected $84.6MM as part of its long-running patent dispute with Apple working through VirnetX.
Wipro. Latest leading India-centric provider to tap a Capgemini exec to be its next CEO.
Interesting IT/BPO Tidbits
Cognizant recognized as a leader in Gartner's 2020 Magic Quadrant for Public Cloud Infrastructure Professional and Managed Services. Cognizant noted they have made momentum in cloud as clients modernize infrastructures and applications to accelerate innovation, become more agile in the face of business uncertainty, and generally reinvent their businesses for the new normal.
Genpact appointed Brian Stevens to the Board, effective immediately. Brian Stevens is the executive chairman of Neural Magic and was previously the CTO at Google Cloud and CTO at Red Hat. The Board has not yet determined which Board committees he will serve.
Infosys noted the plaintiff in the ongoing class-action lawsuit voluntarily dismissed the lawsuit without prejudice. The October 2019 class-action lawsuit was filed against Infosys, alleging claims for violations of the US federal securities laws.
TCS launches cloud solutions to help US banks manage the surge in small business PPP loan forgiveness. The cloud-based, end-to-end solution will help banks accept and process forgiveness requests as part of the PPP. Having disbursed most of the allocated $659 billion in loans, banks now expect to process a high volume of loan forgiveness requests.
NASSCOM collaborates with Automation Anywhere to upskill and certify the workforce of the future in RPA. Automation Anywhere, a global leader in RPA, signed a two-year agreement with NASSCOM FutureSkills to train >300k developers, partners, and students across India.
Accenture noted that organizations need to aggressively look at technology transformation. Accenture noted that systems need to be resilient to withstand significant disruption including accommodating sudden surges and drops. They also noted that transformation investment should largely be self-funded and in areas where immediate vulnerabilities are identified.
The Critical Business Development Importance of
The race to 2020 client acquisition and profits has started. Again.
There are no days off for BPO sales in the United States.
The first Quarter business development process as historically been great productive months for GroupBDO and our clients for the following reasons:
C level contacts need to get the new year off to a great start. They are more focused and open to accept calls, but more importantly to speak frankly and openly regarding what may not have worked in their business development and sales process during the year.
Most sales and business development teams grow weary by Q4, this is when our teams take advantage of the mindset of the weary.
Companies that slow down their BD and sales efforts in Q4 will never truly make up the time as competitors will have already scheduled multiple calls/visits in Q4 that puts their company at the head of the line when others are just starting to identify and qualify opportunities.
Typically companies are looking for new vendors for the new year and the relationship-building starts now for the new year.
The is no slowdown in business development and sales work during the year.
The Importance of First Mover Advantage for 2020
Four Pitfalls to Avoid to Ensure Sales Success in Q1
It’s the first fiscal quarter of 2020. In your meetings and strategy development you seek to build upon the success that you had in Q4. Ahead of you is a brand-new chapter, full of possibility and promise. While it’s important to celebrate your recent successes and create a plan to be even better this year, don’t get ahead of yourself. All too often, salespeople get complacent after having a great fourth quarter, and take their foot off the gas as the new year rolls in. Starting small and avoiding common missteps is the best way to ensure success for yourself and your team.
Pitfall #1: Slowing your momentum and starting over.
If you’re coming off of a great fourth quarter, it’s a natural reaction to ease up and coast on your successes. However, this is the quickest way to set yourself back in the pursuit of having an even better sales year. Instead, use your momentum to your advantage and act with the same urgency in the new quarter that you did in the previous quarter. You’ll be ahead of schedule before you know it if you set yourself up for a positive start. As a leader, maintaining this level of passion and drive will motivate others to operate to the best of their ability, breeding a culture of determination and hard work to begin the year. One great way to keep up the momentum is to have a new year kickoff meeting in the first couple of weeks in January. Schedule a meeting in your office to get your sales team excited, by reviewing the goals you’ve set for the year and how you all will work together to accomplish them.
Pitfall #2: Emptying your pipeline.
Typically, the mindset in the waning months of the previous year is to close as much business as possible. This is an important step in the process, but as the calendar shifts, your priorities should too. To start the year, you need to fill your pipeline with as many qualified suspects as possible. The majority of your time should be filled with prospecting. By focusing on prospecting and driving leads early in the year, you’re arming yourself and your team with the tools to be successful all year long.
Pitfall #3: Setting overly conservative or aggressive goals.
Another way to prime yourself for greatness is to set higher expectations based on what you achieved in the previous year. Whether that’s a new revenue number for your business or an increased number of qualified leads in the first quarter, make sure your business goals are challenging, but not too lofty. It’s important that your goals are still realistic, but you don’t want them to be too conservative or you and your team may not be as motivated to achieve them. If you’ve set challenging business goals, one way to keep your team motivated is to incentivize each individual salesperson based on their individual goals. That way, everyone will be equally motivated and off to a strong start in reaching the goals you’ve set for the year.
Pitfall #4: Disregarding industry shifts.
Don’t overlook industry shifts or trends. Successful sellers and business owners are constantly staying up to date on the current happenings in the industry, but the best are looking past that to “what’s next.” Those that can anticipate events in the industry based on existing trends can prepare themselves to adapt accordingly. To blindly progress through the year and only react to changes as they occur is risky, and can ultimately hinder your sales numbers and achieving your overall goals. Staying in tune with what’s relevant in the industry will help to shift your business goals so you can still achieve success. Remember, what you did last year, may or may not achieve the same results this year, but either way, if you want to do better, you will have to grow, change and adapt in 2020.
Contact GroupBDO to get your team off to a great start.