Outsourcing Business from USA: Is Vietnam a sleeping tiger?

Outsourcing Business from USA Is Viet Nam a sleeping 9ger?

By Shivaji (Sam) Sengupta

[email protected] www.shivaji.info

www.LinkedIn.com/in/shivaji

[email protected]/ShivajiSengupta

Worldwide and U.S. Business Process Outsourcing Services 2012-‐2016 Forecast

IDC expects the worldwide BPO market to reach $202.6 billion in 2016, represenQng a five-‐year CAGR of 5.3%. The U.S. market is expected to grow at a five-‐year CAGR of 4.2%, reaching $92 billion in 2016. IDC concludes that BPO services vendors are beginning to assist the transforma9on efforts of their customers. Evidence is now seen in case studies from providers that describe case studies where they have leveraged their automated sub-‐process solu9ons, big data, business analy9cs, mobility, cloud delivery, and so forth, and as a result, customers are not only reducing errors/defects in their processes but beginning to standardize processes globally, analyze business performance (oLen in real 9me), and gain more insight and control over their business operaQons.

© Shivaji Sengupta 2013-‐2015 All Rights Reserved

Latest Trends affecQng the USA Outsourcing Model

Here are few trends which give idea of what is stored in future for this outsourcing industry:-‐ 1.  Client will ask for increased standardized solu9ons from their

outsourcing contracts, so the vendor will have to differenQate their services through performance rather than pricing.

2.  Industry leaders and analysts predict that industry will face cost pressure, though short term, and Vendors/service providers, will be under pressure for more flexible pricing contracts.

3.  Smaller alliances, which have focus on opera9onal efficiencies, good quality control, lesser back office costs, will have rising trend.

4.  The rising energy cost will pressure companies to look for areas where cost reducQon can be done. Taking advantage of technology and outsourced work to save cost will be on the priority list of the companies.

5.   Cloud based technologies will grow, as they are cost effecQve.


BPO Maturity Scale

Ad Hoc

Defined

Linked

Integrated

Functional strong,Process barely visible

Functional strong,Process boundaries visible

Functional strong,Process strong butwith gaps

Functional and Process strong

Increasin

g BPO Maturity

Key: - Process orientation- Functional orientation

✪

Types of BPO


★

★ ★

★ ★

Finance and AccounQng BPO


Outsourcing advances in Publishing Business


Insurance Processin

g


★ ★

Three Tenets of BPO

Flexible & Stable

ConQnuous Incremental Training & Mentoring

Standardized and

Repeatable

Process People

BPO

Technology

Technical Specialist

Human Capital

Sub Contract

Clients


Top IT Outsourcing DesQnaQons


✪

✪ ✪

✪ India 51%

China 3%

Philippines 21%

Ireland 7%

Advantage India

As the markets in outsourcing have become Knowledge intensive, India has become the most preferred global hub for outsourcing for knowledge services (KPO). India has large pool of skilled manpower resources such as Chartered Accountants, MBAs, Doctors, Lawyers, Research Analysts, Sogware engineers, which is necessary for growth of KPO. The areas of KPO are, where India has edge over other desQnaQons, are :-‐ 1. Finance and AccounQng outsourcing 2. Legal Outsourcing 3. Services that require advanced English like Content and Medicine


China Challenges

Undertaking any form of business transacQon in china presents unique challenges as a result of both cultural and regulatory factors. High levels of employee churn amongst outsourced service providers coupled with limited cultural awareness of the importance of proprietary informaQon. It is important to note that the PRC IPR enforcement regime is focused heavily upon registered rights, so local registraQon of IPR within china can be helpful. There are several key challenges which need to be addressed in a china outsourcing, including: •  Language •  Due Diligence •  Regulatory •  ProtecQng IP •  Contractual


Advantage Philippines

From an outsourcing perspecQve, the Philippines is one of the global Qtans. Ranked 2nd ager India as a business process offshoring market by desQnaQon, the Philippines has emerged as a power-‐player that has aggressively taken advantage of the outsourcing trends over the past decade. Choosing the Philippines for your BPO requirements presents disQnct advantages: •  Lifestyle, language and professional skills that are culturally specific to Western

partners •  A mature, funcQonal democracy operaQng in a free-‐trade environment •  A steady supply of highly qualified and skilled manpower •  Well organized and workable labour laws •  English speaking populaQon •  A 'value added' and pro-‐acQve work ethic •  Access to state-‐of-‐the-‐art technology •  Deregulated financial systems •  U.S. based legal system


Country Snap Shot – BPO PerspecQve

India China Philippines Ireland

High End BPO

Process Maturity

Technology Competence

Scale

Project funding

High End BPO

Language

Process Maturity

High end BPO

Quality

Technology Competence

Rising Costs

Quality Issues

Rising Costs

Language

Low end BPO

Labor Shortage

High Cost

Tax Benefits Gone

PosiQ

ves

NegaQ

ves



Weakness Threats

Strengths Opportunity

Viet Nam SWOT

ENVISIO

N RE

COGN

IZE

DEVELOP

REDUCE

Clients Looking for AlternaQves

ConnecQvity

Real Estate costs

Focused Delivery Teams

Language

25% 50% 100% SCALE OF IMPACT

Business Friendly

Geography

Young Workforce

AccounQng Standards

Sub ContracQng

Value BPO Processes

Domain Experience

InflaQon

Stable Government Labor Costs

Technology Skill Sets Technology Infrastructure

Regional Business

Core Team -‐ Trainer

Vietnam Plan of AcQon

BPO Capability

Workflows & Technology

Partnerships & Alliances

Business Development

Market – India

Market – USA

Market – EMEA


Its not all about wages


Healthcare Outsourcing

What is Healthcare

Health insurance is designed to give you peace of mind. It allows you to focus on your health -‐-‐ instead of medical bills that could pile up when you are not feeling well. When a individual buy health insurance, the health plan pays for many of your medical expenses, whether you visit your doctor for prevenQve care, such as a yearly check-‐up, or you receive medical treatment for a health concern. Health Insurance can also help cover your bills if you need to go to the emergency room. Your health insurance can protect your family members as well, and even extend beyond medical care: certain kinds of insurance can lower the cost of prescripQon drugs, and vision and dental care. You can buy health insurance through your employer, a broker, and directly from an experienced, accredited insurer such as a Health Insurance Company. You pay a premium -‐-‐ a monthly charge -‐-‐ for your insurance and if you get insurance through your employer, your employer may also pay some of the cost. You ogen pay some other costs toward medical bills, too.


Healthcare Programs

• Mailroom/Claims Capture

• Membership and Provider Eligibility

• Edit ResoluQon for Suspended Claims

• Provider /Member Correspondence/Suspended Claims

Claims Processing

• Print and Fulfillment of Membership Kits

• Inbound & Outbound Mailroom OperaQons

• Membership ApplicaQon Review and Approval

• Premium Processing

• Membership Enrollment Card ProducQon and fulfillment Enrollment & Membership Management

• Provider Contract Fulfillment

• Contract Approval and CredenQaling: Direct Access into Client’s ApplicaQons

• Contract Repository & Workflow

• CredenQaling File Conversion

Provider Contract & Creden9aling Management

• Premiums / Provider Reimbursements / PBM Payments

• EOB DistribuQon/Processing/Payments

• Address Search Processing • CMS Compliance Trail

Payment Processing

• Print and Le@er GeneraQon for Surveys

• Capturing of Survey Responses

• Outbound / Inbound Call Center

Coordina9on of Benefits (Commercial, RxCOB)

• USPS / Fax / CD-‐ROM Processing

• Repository / Workflow ApplicaQons • InvesQgaQon / Audit / QA • Audit Trail Adhering to Compliance Measurements for Case TAT

• Integrated Le@er GeneraQon to Providers and Insured • Document Fulfillment • ANSI 837 Receipt

Fraud & Abuse, Hospital Bill Audit

• Complete InformaQon Channel for Medical Benefit RequesQng

• Instant NoQficaQon for Expedited Requests • Integrated Variable Content Management for Approval and Denial

Pre-‐Authoriza9on & Referrals

• Mailroom OperaQons

• Repository Workflow

• Address Search Processing • CMS Compliance Trail

• Address correcQon and re-‐mail

Return Mail


Payment Methodology

MEMBER ENROLLS IN AN INSURANCE PLAN THROUGH EMPLOYER

PATIENT GOES TO A PHYSICIAN/HOSPITAL

PHYSICIAN/HOSPITAL PROVIDES SERVICES

PRVOIDER PREPARES AND SUBMITS THE MEDICAL CLAIM TO THE INSURANCE COMPANY.

CLAIM IS RECEIVED AT HEALTH INSURANCE COM. THROUGH FAX/ ELECTTONICALLY, ETC.

CLAIM IS DATA ENTERED

CLAIMS LOADED INTO THE ADJUDICATION SYSTEM

INSURANCE COMPANY VERIFIES THE CLAIM

INSURANCE COMPANY PAY /DENY THE PROVIDER


AdjudicaQon Process

Member ValidaQon

Provider ValidaQon

DOS/POS/DX/Procedure Code/Modifiers/Billing Amount

ValidaQon

Edits/Suspend ValidaQon

Resolve the edits based on claims P&P

End Process (File/Deny)


Claims AdjudicaQon and Adjustments

Capabili9es Exper9se

Fully Insured/Self-‐Funded

Commercial/Managed Care(HMO, POS)/

Indemnity (PPO, OOAPPO)

Mul9ple Surgery Reduc9on/CCI/NCD

Pre-‐Authoriza9on & Penal9es

Timely filing/ Provider Appeals

Re-‐Pricing

MEDICAL– Professional, Ins9tu9onal, Prescrip9on, Rehabilita9on, ER, DMEPOS

DENTAL – Oral Surgery, Orthodon9cs, Periodon9cs Prosthodon9cs, Endodon9cs

VISION – Rou9ne Vision, Preven9ve Vision, Lens& Frames, Lab order Entry

Psychiatric– Psychology, Mental Health, Stress Management

Strong Project Management Team

Proven Quality Management System

Unique Training Methodology

Buddy System–Unique Knowledge

sharing plaiorm

Skilled Examiners & SMEs

Plan Coverage Product Coverage

•  Six Sigma Control •  Best Prac9ces Deployment

•  Team Based Performance

•  Web Interfaced Dashboard Services

•  Buddy System •  Progressive Evalua9on

•  Train-‐the-‐Trainer Approach

•  People Focused Career Progression

•  Quality Control Process

•  Stra9fied Internal Audit Controls

•  QC Tools based Analysis & CAPA

•  Knowledge Agreement Analysis

•  Sta9s9cal Process Controls

•  Competency Resource Mapping

•  ISO Cer9fied Process Documenta9on

•  Con9nuous Process Improvement

• Intranet Knowledge Base Tool

• Web based PPM and TAT Controls

• Secured and Integrated Workflow Model

• Semi-‐Automa9on Custom Developed Tools

Methodology

Delivery

Quality

Process Control

Technology


Typical SoluQon

•  Current Work for Daimler Trucks NA (Portland, OR)

•  Accounts Payable Workflow Solution

•  Just Renewed Contract for an Additional 5 Years

•  Potential Architecture Leverage of Existing Platform for DAG Services (Moving Towards One Main System)

•  Potential Ramp Time Reductions for DAG Based on Knowledge Gained from DTNA Implementation

Client


Typical Project Team

Delivery Head

Site Head

OperaQons Training Quality

Support Team

Recruitment

AdministraQon

IT

InformaQon Security

Program Management Team

Account Manager

Director PMO

Technical Project Manager

SME / Business Analyst

Technology

Design

Development

TesQng

Release Management


Typical Team Approach Bu

ild Ven

dor &

Client Teams

Project P

lann

ing

Project Ini9a

9on

Solu9on Analysis

Func9onal Requirements

(Including Desired Quality Levels)

Detail Design

Solu9on Configura9on & Prototyping

Deployment Planning

Systems Test

Stress Test

Documenta9on

User Training

Implementa9on

Produc9on

Prepara9on Solu9on Analysis Implementa9on


THANK YOU

Q & A