SOPs for ITeS Industry

What is ITeS? What is ITeS Industry?

ITeS is an abbreviation for IT Enabled Services. In simple language, ITeS refers to the outsourcing of certain business processes or functions to tech companies that have the required IT infrastructure and resources to efficiently carry out those processes and functions. ITeS companies provide these services to businesses from almost every industry. These industries include telecommunications, banking, insurance, retail, eCommerce, manufacturing, healthcare, the public sector, etc. The service areas of ITeS companies cover customer support (call centre services), payroll processing, insurance claims, medical transcription, credit card processing, digital marketing, back-office operations, data entry, legal, accounting, gaming communities, etc.

ITeS versus General Outsourcing/Hiring of Services

One may argue that ITeS sounds the same as any general outsourcing. Yes, the fundamental essence of ITeS is outsourcing. But here outsourcing is taking place to tech companies that specialise in the execution of certain business processes via the use of IT systems and other related resources that these tech companies develop and possess for this purpose. It is their business to execute outsourced functions of other businesses. As the name itself speaks, IT ‘enabled’ services. The involvement of IT is critical to qualify as ITeS outsourcing. If a company appoints a law firm to look after its legal cases, that is not ITeS.

Example of ITeS

Take the example of KYC in the telecommunication sector. After completing the KYC process for customers, telecoms may choose to outsource the data entry process to any suitable ITeS company. The reason for them to do so is that data entry is not their core business. Also, it is more cost-efficient for them to outsource this process. If they choose not to, they will have to maintain a separate department and hire employees. But by outsourcing, they get the work done in lesser time and at lesser costs due to the specialisation of data entry companies in their core line of work i.e. data entry.

Process of Outsourcing: Clients and Service Providers

Problem Definition / Need Analysis

Except in premeditated situations, the need for outsourcing is felt when the overall functioning of a business enterprise is adversely affected due to certain processes or functions. A business process/function becomes problematic (worthy of being considered for outsourcing) when executing it internally slows down the overall efficiency and effectiveness of a business enterprise. The first logical step in moving towards outsourcing is defining the problem statement. If there are no problems, then why consider outsourcing? Defining the problem also entails defining the business process in question. If the process activities are not known, deeming the process undoable is poor judgement. In the context of outsourcing, a sound problem statement establishes the general and specific challenges posed by the internal execution of a business process. SOPs are used to define any business process in great detail and help businesses identify the pain points of that process. SOPs are also used to develop the system of collecting information and insights from various stakeholders required for defining the problem statement.

Someone’s problem provides someone else the reason to solve that problem. The understanding of the pain points of businesses is a critical insight for outsourcing companies. These pain points need to be addressed in their services and solutions. The need for service providers or the outsourcing companies is to develop robust process management and SOP solutions for their clients. But the case is more complicated with outsourcing companies because they manage multiple clients. And different clients may have different process requirements that redirect outsourcing companies to develop and run many versions of the same business process.

Case for Outsourcing

Defining the problems surrounding the internal execution of a process need not necessarily take to the conclusion that outsourcing could solve the problem. There is a need to assess the viability of the outsourcing solution as well. Some important questions to be asked at this stage are:

Can outsourcing solve the problem?
Will outsourcing be operationally and financially viable for the business?
Is the status quo threatened? What new risks and challenges emerge from outsourcing?
What organisational changes will be required? Are they feasible for incorporation?
What regulatory framework has to be complied with to avail outsourcing from any domestic or foreign company?

This entire decision-making process could be mapped and defined using SOPs. SOPs could help ensure that the sequence of information collecting and processing takes place as required. And this is not just for the benefit of internal streamlining of the decision-making process. SOPs could be also extended to cover external entities like regulatory bodies and business consultants.

On the other side, service providers also need to assess whether outsourcing could help solve the process issues and how it could be made to work. Their role here is not just to sit back and wait for a client to appear. It is to reach out to them with solutions and recommendations as part of their sales and business development process. Having an SOP-based process for planning and delivering business development packages helps ITeS companies reach out to a wide range of clients with more accurate solutions.

Finding and Appointing Suitable Partners

When a company decides to outsource a business process, a part of its job is to also identify and appoint a suitable outsourcing company. The service provider should possess the requisite IT infrastructure, experience, manpower abilities, and other resources to be able to meet the service requirements. This entire search and selection process could be planned and mapped using SOPs. This will ensure that the activities take place in a systematic and manageable way. Responsibilities could be assigned to eligible authorities with accountability. The process of evaluating the eligibility criteria of the service providers could be established in ways that serve the business interests and leave no scope for bias or favouritism.

And once a suitable service provider is selected, the next steps are to complete the onboarding formalities like the signing of various agreements like NDAs and SLAs, establishing the protocols for sharing of IPR, finalisation of terms of payment, etc. All these activities could be brought under the realm of a process defined by SOPs for Information Technology & system encompassing both business and technological requirements.

Finalising the decision to provide services to a client is also a process for an outsourcing company. The service providers also need to evaluate the potential contract from their perspective. Being process-oriented only helps them to make important decisions in this regard. There could be so many reasons that the terms and conditions of an outsourcing contract may have to be improvised to suit both parties. It is also possible that an outsourcing company may have to reject a service proposal. It is also important for the service providers to work with the right clients in the right environment. All the activities and considerations that an outsourcing company wants to be followed before a client is finalised could be defined as SOP-bound processes.

Delivery and Service Management

Before an outsourcing project begins to roll, both the clients and services-providing companies need to set out the system of processing, delivering and acknowledging the work done. Take the general example of a building contract. The owners and builders decide in advance how the project will move forward. This also includes defining the benchmarks of progress. Frequently, both builders and owners inspect the progress made. The same goes for clients and outsourcing companies. They define in advance the mutual routine obligations, roles and responsibilities for teams on both sides, task deadlines, reporting mechanism, invoicing and payment methodologies, audit and control, performance and feedback, etc. SOPs for IT companies are helpful in the better management of this service delivery and monitoring function.

Closure/Transfer

The situation of closure or transfer of an outsourcing contract emerges when either party decides to terminate the same. The reasons could be the termination of a business process, migration of the contract to a more capable outsourcing company, the emergence of feuds and disputes, failure to honour the contract, poor performance, etc. For any such situation, both parties should have a pre-agreed exit policy and procedure. While policies remain on paper, it is the execution of the exit process that matters. There should be no ambiguity in defining the roadmap for the exit process. SOPs ensure that every step is well-defined with specific standards of performance laid down. Exit SOPs can cover the withdrawal of access rights, fulfilment of pending obligations on both sides, full & final settlement for accounting and taxation purposes, etc.

Why BPX

BPX is a management consulting brand specialising in process management solutions and SOP writing services. With 10+ years of experience, we have served 500+ clients from over 20+ verticals.

As a budding brand in the global picture, BPX strives to deliver world-class solutions with hybrid service design and delivery functionalities. Our robust feedback and reporting mechanism enables us to work in close coordination with our clients and deliver the best solutions.

We have agile working systems that make it possible for us to hire and engage professionals from all over the world as per requirements. Our teams comprise qualified and experienced SOP writing consultants and business process consultants with rich project exposure.

BPX offers process management solutions and SOP writing services to businesses engaged in the ITeS sector. Our services and solutions are aimed at helping businesses develop robust processes and achieve operational excellence in ITeS outsourcing.

To know more about our process consulting and SOP writing services or if you have any queries related to SOPs for ITeS, drop us a message with your contact coordinates and we shall get back to you.

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