Wednesday, 9 April 2008

Good and Bad side of BPO

Now, I had started to think that BPO contracts were a bit 'boring' - none more so than back office Life and Pensions. See Outsourcing - Boring, Boring, Boring. Have none of it.

Yesterday I learned that Liberata has been fined £525,000 by the Financial Services Authority for failures in its systems and controls for producing and issuing documents to life and pensions policyholders between January 2005 and April 2007. The failings resulted in 30,000 of Liberata's 1.3 million policyholders not receiving information; 161 of these suffered financial losses totalling £17,584.

The FSA determined that Liberata had 'acted recklessly in failing to heed warnings in its management information that documents were not being produced.' Source - Ovum Holway Hotnews.

Today BPO specialist Xchanging reported a 17% rise in quarterly revenue to £131m and said growth was slightly ahead of expectations; helped by strong growth in financial markets.

"We've made a good start to 2008 which looks set to be a very promising year for Xchanging," said CEO David Andrews. "The high visibility of 2008 revenues from existing contracts and customers makes us confident about continuing our rapid growth".

Regardless of fines, I believe that BPO is the safest place to be in today's stormy weather. As Xchanging is showing, BPO from financial services players can actually be boosted by the current crisis as these institutions search for quickly implemented cost savings.

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