This Process Excellence person at the Indian BPO we dealt with was not amused!
The customer was happy with their SLAs, the process seemed to be running smoothly
and no complaints!
Then what was the problem? The Problem was that the company was throwing lots of people at the problem rather than making sure that only those that were necessary to the execution of processes were there and the others who were goofing off, hit the door!
This Process Excellence person analyzed the business process and found that in each of the six main Key Performance Indicators, only about 50% of the agents were meeting targets and less than one percent of the agents MET ALL SIX TARGETS.
How come, the customer is still satisfied? It was obvious that they were throwing more people than necessary at the problem and the low people costs more than made up the deficiencies.
Is this a good thing? Surely not for the Indian BPO, whose personnel costs were rising and margins shrinking! Ripe for the process to move over to some other low cost destination where they can afford to throw even more people at the problem than needed.
This is how low cost nations may throw valuable opportunities out the door even
before they have a chance to stabilize and build on them!
Software Development or IT support is no better. In low cost countries, people are thrown at the problem even more. In Software Development, it is not only stupid but downright
dangerous to throw more people at a software development effort!
In 1975, Frederick Brooks wrote in his book "The Mythical Man Month", the dangers in throwing more people at a software development project. He talked about the number of communication links in a project that has n people – n(n-1)/2 . In other words, a LOT of chances for communication to be screwed up between the participants!
In the past, many Offshore Software Development companies had a vested interest in making team sizes large; they got paid in Time and Materials. However in an age of Fixed Price Offshore Software Development contracts, throwing more people at a software development project ensures that not only is the project delayed and results not satisfactory but also that the margins erode very quickly, especially in a high wage inflation environment like India.
So throwing more people at the problem, even if the wages are relatively low, is a disaster waiting to happen.
In the end, only productivity rules, whether wages are high or low. Low wage environments cannot afford to ignore productivity just because wages are lower!