Is Outsourcing-as-a-Service the Future?

Over the past few months, the popularity and growth of cloud services has increased exponentially as consumers start to realize that the cloud is their only solution to their ever-increasing demand for both computing power and storage space. Companies, therefore, need to prioritize new cloud-based service offerings in order to take advantage of consumers’ expectations.

BPO service providers don’t want to be left behind, as they are now part of the trend of ‘Outsourcing As A Service’, where BPO companies are now including cloud technology into their everyday delivery infrastructure. Doing so allows them to deliver a more technology-intensive solution without increasing their operational costs. BPO companies also benefit from the consumers’ current fondness for cloud technologies, since they can get more credibility by advertising their use of the cloud infrastructure in order to deliver stable and highly scalable services.

Of course, before Outsourcing as a Service fully takes off, enterprises first need to define the term “cloud” based on their industry’s context. There are actually two kinds of cloud that they need to be aware of: the “Utility cloud” and the “Grid Cloud”. The former is mainly commercial, while the latter is made up of different web services and large scale data analysis systems. In order to reduce costs, companies must scale out and produce multiple copies, instead of simply scaling up within the grid cloud. Eventually they will have to move on to utility clouds.

Another reason for the growth of the cloud’s popularity is the industry’s tendency to gravitate towards more automated and tuned processes within businesses. Cloud has become a divisive issue for BPO providers, with one side languishing in the staff supplementation model while the other side sells productivity through automation.

Smaller BPO Providers

Smaller BPO companies will benefit from cloud-based technology, since it levels the playing field. The cloud’s ability to compensate for lack of server farms and limited manpower means that small BPO providers can now compete with large companies in terms of manpower and technology.

The industry’s move to the cloud is fairly smooth, owing to the fact that the converged platform is not based on a fixed model, as different pieces interact with each other through the movement between the supplier and the enterprise.

Whether a small BPO provider can offer the same level of orchestration as a large enterprise lies in their ability to move workloads and how modular their services are. Business will always start slow and simple, but as it grows or mature, there is a need to be able to keep up with them.

The Benefits of Being a Good Cloud Customer

Before a company can migrate to the cloud, it is important that they first experience what it’s like to be a good cloud customer. Not benefiting from the cloud technology on both ends is a terrible waste, so companies need to be good cloud customers first in order to know which provider to get.

This is one of the biggest reasons why the skills and role of the CIO in companies have changed in the past few years in order to accommodate the needs and requirements of a successful cloud implementation. The CIO’s duty has always been to act as the lynchpin of several IT departments, resulting in some CIOs denying the existence of a cloud in their company.

Unfortunately for CIOs, the massive success of pay as you go cloud services from industry giants such as Amazon and Google meant that a lot of business functions have started to bypass the IT department. This means CIOs need to keep up with the times and update their policies in order to have some semblance of control when cloud becomes widely adopted.

The Current Procurement Models and the Flexibility of the Customer

At the moment, the ITO procurement model fails to capitalize on the benefits of flexibility and agility, which is the two main selling points of the cloud. This is because the ITO, which has been the predominant model for procuring cloud services, usually works in monthly time periods, as opposed to the cloud’s ability to deliver in a span of days. This needs to change before companies benefit from the cloud.

In order to facilitate this change, the CIO must change the IT department’s attitude. They must adopt the mindset that they provide services to various business functions. Enterprises must also learn how to respect the IT department as a procurer of services.

At the end of the day, it is important for a company to develop the ability to provide cloud services via different areas of the business. The main challenge rests in the CIOs shoulders, as he or she must try to get people to realize the advantages of cloud services, both in terms of the consumer and the business.

Source: Cloud Times
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