Niche BPO gaining traction

March 20th, 2007 at 06:12am David Bush - Iasta

I read an interesting article in European Leaders which was focused on the growing emergence of niche/boutique BPO companies. According to Morgan Chambers, smaller players are starting to gain momentum in outsourcing and beginning to pose a threat to large providers, who were described in some cases as having levels of innovation that were “shocking and lamentable”. Further, the findings showed that 25% of those surveyed intended to outsource more in 2007, which should act as a catalyst for innovation and improvement from the large providers. I tend to disagree with this point. When large companies are getting so much business that they don’t need to work for it, innovation is the first thing that gets the axe. If you don’t believe me, look at how bad Internet Explorer got after MSFT squashed Netscape. It was not until the angry mob built Firefox until something relevant changed with IE7.

This all reminds me a bit of the eSourcing industry too. Eons ago, FreeMarkets could choose their clients and name their price. Slowly companies like Iasta and Procuri, chipped away with features, support and price until there was a new market identity with many options. The rising tide lifted all boats and the users benefited in many ways.

Back to the BPOs, I am sure the findings are accurate but Iasta has an extensive working relationship with one the true heavy weights of this industry and have had a very good experience. There have been times that adjustments were made but that is natural in global, multi-billion dollar shifts like these. I think there are, without question, value propositions from both large and small providers…just like in software.

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Entry Filed under: General, Global Supply Issues/Risk, e-Sourcing Marketplace