FAO Today has listed the top Enterprise Providers for years. Now, it takes on the task of ranking them. Here’s how we did it.

by Elliot Clark

In the past, FAO Today magazine has been criticized for its loose selection methodologies. It is an area that we needed to improve following the recent change of ownership. Much of the criticism surrounded lack of data and justification for the lists of providers produced by the magazine. Moreover, the lists when produced rarely offered much insight for the reader on how to interpret the results.

For the FAO Enterprise Provider Bakers’ Dozen, we experimented with a new approach. We generated a survey that comprised 25 qualitative or quantitative questions. We established criteria and weighting for different questions in advance, but we did not disclose the question rankings to the FAO providers. We did this so no provider (not that we thought anyone would) could coach a respondent to the key questions that drove the overall rating. We surveyed our buyer database and asked for responses. We also submitted the surveys to the FAO providers and asked them to distribute the surveys to their customers. We made it clear to customer respondents that their answers were confidential. Almost all responses came from our solicitation. We assembled a database of their input and only counted those with contact information so we could authenticate the response.

The survey items examined the components of FAO service to arrive at an index we show as “Overall Breadth of Service.” A comprehensive service offering that can replace internal functionality is the ultimate goal of the outsourcing industry, so we thought this was important to measure. It is also harder to provide service across broader offerings and we took this into account. Questions sought “Yes” or “No” answers regarding each service component. The answers were then assigned points, averaged, and calculated to generate the index. The larger and more complex the program is, the more axiomatically difficult it becomes to get great Quality of Service scores, and this was factored into weightings of the overall index related to Breadth of Services.

Another index was generated on the overall size of program. While we debated the use of this index and ultimately discarded it as not significant to the outcome, it was a good indicator for us as it closely mirrored the breadth of service and revalidated that data set. The final component of the index was Quality of Service. This was based on a series of questions that examined the performance and the relationship between provider and customer. We used a 5-point Likert scale with answers ranging from “Strongly Agree” to “Strongly Disagree.” Each answer was ascribed a point value, and the points were totaled and averaged, whereupon the mean was calculated into the “Overall Quality of Service” index. We then weighted each element for the overall ranking. We believe it is fair and unbiased and shows the sentiments of the buyer respondents. It is also a very defensible algorithm for indexing service providers.

A few other points are noteworthy.

We recognize that FAO is global and many of the providers are global companies; however, our readership is principally North American, so we did not rate providers that operate primarily outside of the U.S. Many of the providers surveyed, however, are providing their customer global delivery platforms.

The term “Enterprise FAO” has been historically somewhat ill-defined. For example, there are excellent providers such as Outsource Partners International and part of Accenture that target middle market companies but have broad offerings. Is “Enterprise” based upon the number of processes? Or does it include companies such as Sourcenet Solutions, which specializes in a few processes but has very, very large engagements in those processes. Simply put, because our methodology may create a certain ranking does not mean the top-ranked firms automatically meet your needs. You need to consider your requirements and your market environment before deciding whom to include in your RFP process.

There are many highlights in the data. For example, while Capgemini leads the overall index, Wipro has a capacity for very broad programs. Outsource Partners International has the happiest customers. In terms of the top Enterprise FAO Providers you usually hear that IBM, ACS, Accenture, Capgemini, and HP are the industry leaders. However, it is clear that companies such as Genpact, Wipro, Infosys BPO, and WNS are making credible challenges for market supremacy.
Whether you agree with our specific ranking or not (and you will hear lots of opinions in either direction), these are the top FAO firms, and we hope this helps you evaluate whom to call in the year to come.

Click Here for the complete Baker's Dozen Listing.