We read with interest that Quatrro, a busines process outsourcing (BPO), knowledge process outsourcing (KPO) and legal process outsourcing (LPO) company, plans to acquire three US BPOs. (Economic Times, 7 August 2008.) We wish them well, but as we previously wrote in BPO Players Moving Up the KPO Value Chain, we think that building a combined BPO/KPO/LPO is a difficult strategy to execute.
We have extensive experience working with demanding professionals such as lawyers and investment bankers. On the one hand, they are apprehensive about dealing with BPO generalists, who are not focused domain-specialists in their markets and therefore may lack the relevant people, process, judgment and technology systems. We are seeing some reversals of earlier decisions to outsource KPO work to BPO generalists where those BPO suppliers have struggled to deliver the appropriate level of professional service, failed to deliver ongoing continuous improvement, promised transformation but did not deliver, or did not create the training and career path that would keep professionals from leaving.
On the other hand, lawyers and investment bankers want to make sure their business partners are financially stable and a suitable scale to serve their business continuity plans (BCP) and breadth of service needs. In our view, the LPOs and KPOs that will thrive long term are those that specialize in these professional support sectors with scale. BPO services such as mortgage servicing and voice support are different enough businesses that they ultimately don’t fit well with KPO and LPO work.
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