Covering a wide range of services, from knowledge management through to training and HR, with BPO at its core. Successful operators use intellectual capital to build strong client relationships, a compelling brand positioning and a rounded, cost effective product offering.
These services are powered by the intellectual capital of the providers, which creates both opportunities and challenges. Financial returns can be high for those who deliver innovation and add value to their clients’ thought processes. The ability to grow these businesses and build real scale is, however, critically dependent on being able to access the best talent.
The last five years have seen an increasing willingness amongst corporates to outsource core white collar services, while we have also seen the emergence of international businesses capable of transferring intellectual capital between geographies and supporting the requirements of increasingly global clients.
To achieve long-term profitability, white collar service providers need a clear competitive advantage. In most cases, this will come from one of two sources:
Scale – the largest providers compete through the size of their infrastructure, their wide industry knowledge, their well-established processes, their ability to attract and retain large quantities of talent, their volume-based cost economies and, typically, the complementary offerings from sister companies.
Specialism – successful smaller-scale providers typically compete by providing industry-leading people, processes and technology to niche markets. The services are usually complex and non-commoditised, and the market may have significant barriers to entry.
At 3i, we aim to partner providers who successfully harness the key drivers of the market:
- Creating a compelling brand: Providers that build a powerful brand will be able to differentiate themselves.
- Strong client relationships and a deep understanding of the client’s industry and needs.
- A revenue model that is based on outcomes, not inputs, giving the outsourced provider the opportunity to increase margins through efficiency and innovation.
- Expanding the offering: Agile operators are completely focused on client needs, searching for opportunities to enhance their range of services through profitable new activities.
- Offshoring: Undertaking services remotely, often in Asia, gives European businesses the chance to tap into highly-educated, lower-cost pools of talent, ideally-suited to a wide range of activities, from investment research and design to preparation of client proposals.
