moving away from a transactional provider - genpact

8/3/2019 Moving Away From a Transactional Provider - Genpact

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1Confidential. All trademarks appearing herein belong to their respective owners.

Making the shift Moving from transactional serviceprovider to end-to-end process transformation

Harpreet DuggalSenior Vice President, Genpact

NASSCOM BPO Strategy Summit

10 June, 2009 Bangalore, India


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The Natural Evolution of Globalization - The MoveTowards Value-Added Services

Labor Arbitrage

Productivity

Capacity

Competitiveness

u 25-50% cost savings

u Leverage global talent pool

u Turn fixed costs into variable to support expansion & growth

u Onshore capital expenditure avoidance

u Benefit from Six Sigma and Lean expertiseu Margin expansion

u Enable companies to become better at Core to grow top line

u Preservation of cash & improved working capital

u Take Processes to Best-in-class

u Minimize capital investment

All of us Want to Travel to Best-in-Class

1990s

Early2000s

Mid2000s

Today


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Corporations Are Facing A New Competitiveness

u Escalating pressures on enterprises global competition

demand for innovation

speed to market

productivity pressures

risk mitigation & compliance

shareholder scrutiny

u are leading to a shift in corporate strategy focus on core

global sourcing

variable cost models

minimize capital investment

improve productivity

uThere are fundamental shifts in the corporate landscape

Demanding a

new breed ofBusiness Partner


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Globalization is About More than Cost Reduction

.. but Getting Full Value is Easier Said than Done

Narrow focus on short term cost

takeout & contracted SLAs

Not getting into full partnership

mode early

Reluctance to change/re-design

processes significantly-

Perception of unique

processes, we are the best

and operational disruption

Clients saving commitment tostreet and budget limitations

delay the right level of upfront

investments required

The Full potential: Road-blocks:


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u Deep expertise in specific industries

Banking, Insurance, Automotive, Healthcare .

u Deep Expertise by Domain

F&A, Supply Chain, Collections, Risk Management .

u Define what is the standard for Best in Class, by industry and byDomain and deliver those to customers.

u Research & Development into Optimum processes and enablingtechnologies

e.g. invoice exchange, translation, task

dis-aggregation, core vs. non-core

1. Process Expertise / Best In Class Services

Need to Demonstrate True Process Expertise & DomainKnowledge to Create Value

Domestic Outsourcing...not about Cost Arbitrage


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2. Delivering Business Solutions Moving from Transactions to Solutions

u Bundling of Services

u Delivering specific value

u Linkages between Services& Technology

u Delivering Cost &Productivity

u Delivering Total Services

Procure to pay (sourcing + AP + cash management)

Sales Force Effectiveness

Risk Management

Working Capital Improvement

Credit Card Operations

Sales Force.com?

SOX.com?

Hospitals.com?

Well beyond labor arbitrage through processimprovements, re-engineering

Pricing based on results

Complete back office to support expansion

Tax, Infrastructure, Accounting, Admin


Integrated Process & Technology Solutions


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3. Unleashing Disruptive Virtual Companies

u Utilize Intellectual Talent & Virtual Expertise to dramatically shift costsand compete in existing businesses.

u Ideally focused on service industries/ knowledge based

u Utilize the power of the internet & telecommunications Virtual Investment Bank?

Virtual Market Research?

Virtual Insurance Co?

Virtual Bank?

Virtual Architect, Law Firm, Advertising?

uHuge Potential current Services work is helping build up the DomainKnowledge to compete

Focus On Core Competencies Revolutionize Biz Models

India More Likely To Adopt Disruptive Models



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Driving Performance on Business Outcomes requires

an End to End Process View

End to End allows a Process view that can transcend thefunctional silos in an organization

Benchmarks at sub processes level allow detailedcharacterization of potential for improvement in each step...

and its subsequent impact at a business Level

End-to-end approach can enable companies drive stepimprovement in process performance through focused andflawless execution

Significant process variability across companies driveslarge variances in similar processes


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u 60/70% of common processes

across industries are similar

u Measuring Process Efficiency

alone misses the real benefits

u Driving real improvements

requires Process Expertise +

Technology + Analytics + Insight

u Clients will require different levels

of interface at different times

Key Elements of End to End

Some Obvious Questions Need An Expert To Answer Them

u Build a common framework for

comparison

u Measurements focused on

Effectiveness and Efficiency

u Huge potential impact of

combining skills, solves real

business issues

u Implement in Modules, no Big

Bang required

Key Hypothesis Key Elements


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End-to-EndProcess Efficiency Effectiveness

Originations Time to key in an invoice Cost per loan application

Conversion rates on applications ? Volumes

Cycle time to open a new customer account

Bill to Cash Collection efficiency % (Cashcollected / Total AR)

Past due %

Eliminate billing leakage

Days Sales Outstanding

AccountPayable

Invoices actioned on time

Total AP cycle time

Paid on Time %

Vendor queries

#Vendor discounts

Key Business Outcome Improvement Drivers

u Insights Technology only solves part of the problem:

E.g., only 40% of transactions in the Accounts Payable process are first pass, straight through

Typically only 5-10% of the end-to-end cycle time of a process is value-added time

u The E2E approach also leads to higher employee engagement

u Will facilitate the move from FTE-based pricing to outcome-based pricing models


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Our Learnings from work with multiple customers/processes

u No one customer is Best-in-Class across metrics pockets of brilliance

u As wide a variation within a company as across companies

uGranular, practical insight is the key to continuous improvement

u Technology is just one potential lever process expertise, analytics andability to drive behavior are often bigger levers

u Unique roadmaps are required for each client based on their view onpriorities, risk, investment and appetite for change

Unlock 2X 3X value,

in addition to the traditional 30-40% process efficiency


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Contact Information

Harpreet Duggal Senior Vice President & Business Leader

[email protected]

www.genpact.com

Thank You

Confidential. All trademarks appearing herein belong to their respective owners.

moving away from a transactional provider - genpact

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