This is the third in a series of three articles. Read Part 1 here, and read Part 2 here.

Business process outsourcing (BPO) transitions are hard. This fact doesn’t change regardless of whether the transition involves more traditional, labor-based services or a technology-based solution. Likewise, the steps associated with a technology-related implementation are broadly the same. What does change are the points of emphasis when transitioning—what to expect and how to best support that transition effort to ensure it goes as smoothly as possible.

With technology-based BPO implementations, everything is changing at the same time. On the surface, this doesn’t sound dissimilar from the more antiquated “lift and shift” approach, where the number of elements changing simultaneously, while daunting, is limited to mostly people and location—legacy processes and technology largely remain intact (although there is always some amount of process and technology change required when moving activities, especially offshore).

With a more transformational, technology-based BPO implementation, the number of variables increases. Provider systems are used, and clients become more reliant on the “standard” provider processes that enable and accompany those systems. This creates the need to think differently about the activities, timeline and resources required to transition effectively to a transformed, automated future-state.

Before Moving Forward, Take a Step Back

Before undertaking any planning or execution activities, it is important that the buyer of a technology-based BPO service understands and appreciates the nature of the solution being provided. Ideally this happens prior to a contract being executed, but it is not unusual that the buyer’s understanding of technical and functional capabilities of the solution is based on the marketing collateral provided, salesperson descriptions and high-level product demos performed during the selection process. These tend to seduce a buyer into believing that the capabilities are more robust, the results are more impactful and the implementation effort is more straightforward than may actually be the case.

Once the detailed design discussions commence, there are often customization and configuration requirements to align the capabilities of the tool with the business processes of the client, which adds to the complexity and implementation effort. Taking a “deep dive” into the tool prior to proceeding with execution provides an understanding about how client requirements drive deviations from a standard configuration and helps to ensure costs, timing and resources are planned for in an informed manner.

Involve IT Early

IT has not always received a welcoming invitation to the BPO dinner table. For many of the traditional labor-based BPO deals, IT’s participation was not considered essential to effectuate service delivery and therefore IT input was either not proactively sought or was circumvented by the function procuring the services. With BPO services that are largely provided based on technology, IT’s participation and ownership becomes a critical success factor for an effective implementation and short stabilization period—and the earlier the better.

A client’s IT organization has the technical knowledge to validate functional capabilities, confirm the implementation approach is compatible (e.g., similar definitions of design, build, test), accurately estimate costs and timing, and identify risks and issues that may not be apparent to the business function (e.g., practical implementation constraints such as blackout periods). IT’s insights and direction are also important when determining data privacy and security considerations that need to be built into the solution design and subsequently tested. Without IT’s early involvement in evaluating integration requirements, a client runs the risk of finding out too late that integrating provider systems to client enterprise systems is cost-prohibitive and invalidates the business case.

Expect Change

Technology-based solutions are inherently different from more traditional labor-based solutions in that a client uses provider systems, and is therefore forced to adapt processes to align with the capabilities of those systems. While the client’s business rules won’t necessarily change, the specific steps required to execute the business processes certainly will, as many of the formerly manual activities will be automated or efficiency-enhanced. Process flows need to be recreated to incorporate the functionality of the systems and detailed process execution documentation needs to be developed (e.g., desk-level procedures) to reflect screen-shots and mouse-clicks that are new to the client.

As the client never abdicates process ownership or accountability for process results, this means the client resources need to dedicate themselves to develop expertise about the new systems and processes in a short period of time. This results in a nuanced knowledge transfer approach, where there is a bifurcation of responsibility for training: provider resources are responsible for much of the process and system oriented training while client resources are responsible for providing business context and monitoring results while simultaneously learning about the new systems and processes.

Establish Robust Governance

With so many operational elements changing simultaneously—people, process, location, technology—implementation governance must be well planned and executed so all the moving pieces remain in sync throughout. A cross-function transformation management office with a mix of dedicated transition management resources and leveraged functional resources (e.g., IT, communications, HR) will help to ensure proper planning and coordination, risk mitigation, and activities are completed on-time and on-budget.

The construct of the retained organization and responsibilities of retained resources often change, as many of their prior transactional tasks have been automated, resulting in a much higher occurrence of more judgment-based, “knowledge worker” activities. As a result, a comprehensive change management plan must be developed to include an evaluation of how life changes for the workers that are affected (e.g., retained resources accessing new systems and executing new processes) and any external stakeholders (e.g., new business rules that may affect suppliers or customers).

It is also not uncommon for BPO providers to develop partnerships in an effort to provide clients with innovative best-of-breed technology solutions that complement their process-based services. In such situations, despite establishing an expectation upfront that the BPO provider will serve as the “one throat to choke” for implementation, coordination, execution and support (i.e., the client will only have to interact with the BPO provider), the reality is that the client implementation team will likely need to serve as an intermediary between the provider firms and at times manage the technology provider directly.

As with any complex, transformational change, implementing a technology-based BPO solution requires the right combination of planning and execution. On the surface, it may seem that solving business problems through automation and technology enablement reduces the reliance on people, but this isn’t the case as so many operational elements are changing at once.

To ensure a successful implementation, a buyer must thoroughly understand the technology solution it has selected, involve the right functional and technical resources, prepare the organization for the impending change, and establish a robust transition governance capability. While these steps will not necessarily guarantee a successful implementation, they provide the foundation for success by focusing key migration resources on knowledge, preparation and delivery.

David Borowski is a principal at Pace Harmon, an optimization and outsourcing advisory services firm providing guidance on complex outsourcing and strategic sourcing transactions, process optimization, and supplier program management.