05 Jun 13 Traditional KPOs Can Get a Slice of the Analytics Pie
The tremendous opportunity and growth potential in the analytics segment has attracted a variety of entrants. And it’s not all just hype. While large IT/BPOs, such as Accenture and IBM, have gotten into the sector in a big way, multi-service providers, consultants, and pure-play analytics providers have also established themselves in this USD 5.3 billion global market. A recent report from NASSCOM estimated that the global analytics industry was growing at a compounded annual growth rate (CAGR) of 45%, and will reach USD 25 billion by 2015.
The use of analytics by companies is growing exponentially, and as a result, has become so pervasive that it has started affecting traditional Knowledge Process Outsourcing (KPO) providers. Buyers of KPO services which have already reaped the benefits of traditional KPO, process efficiency and cost savings, are now looking for more value from their outsourcing provider. Part of that value is the ability of the provider to use their existing domain knowledge to analyze data about the processes being outsourced. KPO providers can showcase their thought leadership and innovation capabilities by leveraging their expertise to create specialist analytics services tailored to meet the unique needs of their clientele.
Analytics in Legal Outsourcing
Legal Process Outsourcing (LPO) providers were the first on the KPO scene to start providing specialized analytics service offerings to their clients with patent analytics. This usually includes landscape analysis, infringement analysis, and white-space analysis or GAP analysis. All these LPO specific analytics services allowed their clients to strategize their patenting activity and gain competitive advantage.
The main technologies used in data analytics, such as predictive coding and concept search, can be co-opted by LPO providers to analyze and reduce volumes of documents for litigation review. There are several companies with technology-assisted review products in the e-discovery market which use analytics to reduce the time involved in document review. When lawyers have to sift through millions of documents to identify the few that are relevant for the case at hand, predictive analytics can come in handy. For instance, early case assessment technologies are used to reduce the number of documents to be reviewed by almost 98%.
Daegis, an e-discovery company, teamed up with an analytics provider to develop a technology for their customers to ease the tedious task of document review. There were a couple of constraints the analytics company had to overcome when developing this technology:
- The system should simultaneously make predictions and measure the predictions’ accuracy
- The interface and process should be defendable during court proceedings by lawyers
The final dashboard integrated both these constraints and provided material which a legal team could use to defend their findings in the courtroom.
Analytics in Publishing
With the global e-book market estimated to grow at 42% each year, many Outsourced Publishing Services (OPS) providers are entering the market with their own conversion technologies. To really stand out from the crowd, they should offer publishers the ability to extract analytics from their e-book sales for audience insights.
Some OPS providers have started offering analytics services for the e-books they create for publishers. This analytics service is delivered by attaching a plug-in to an e-book when it is uploaded to their store.
This type of data-driven e-book publishing provides publishers insights on their e-books such as:
- Engagement data: the method and place of purchase
- Demographic data: insights on the demographic profile of the reader
- Performance data: measures how far readers are getting through titles and the areas with the highest reader attrition
To assuage privacy concerns, such data is collected anonymously, with the reader given a choice to opt out. The data collected is aggregated to deliver audience insights to publishers which ultimately help them understand who is reading their books. This type of analytics offering is beneficial for any type of e-book publisher, whether it be educational or trade.
Qbend is one such OPS provider which in addition to custom digital publishing solutions also provides an online store service. While the main goal of this store is to allow publishers to sell their content to a wide audience, their clients can also easily generate customized business analytics of their e-book sales.
Analytics in Engineering Services
The two KPO sectors are not the only ones which offer specialist analytics services. Some Engineering Services Outsourcing (ESO) providers implement analytics in the Product Lifecycle Management (PLM) process.
Since PLM solutions cover the broad range of a product’s lifecycle from ideation to service, there is a need for comprehensive capabilities to track and monitor various aspects of PLM processes. For instance, once information from the Bill of Material (BOM) in various stages, such as engineering, planning, and manufacturing, is accurately gathered, a single analysis report is generated to identify any errors or discrepancies across functions. Any disconnects in the data is then reconciled quickly thereby reducing the impact on production for the end client.
Take a Chance on Analytics
As KPO evolves and matures, providers will be called on to deliver higher levels of value. Providers accumulate a wealth of data and information from their client over a contract period. If they develop their analytics capability, they can measure the right metrics and deploy models or algorithms to offer analytics-based intelligence to their clients. At this nascent stage, it is difficult to predict whether traditional KPOs will have to embrace analytics to grow, or if they can survive without it. In the Business Process Outsourcing (BPO) industry, of which KPO is a sub-set, some companies have embraced the concept of high-performance BPO which includes, among other things, using analytics to drive business outcomes for their clients. While larger and more well-established BPOs have successfully deployed it to increase their top-line, smaller companies have continued to survive without, as it is a non-core offering.
Adding analytics into a provider’s service portfolio isn’t going to be easy, as it involves building an expertise not aligned with their primary business goal and hiring talent with a different skill set. However, its value as a potential revenue generator means that providers in other KPO sectors should follow the lead of companies which have already adopted it. By successfully anticipating the analytics needs of their clients, these providers can add various analytics offerings into their service portfolio and increase their top-line revenues.