The paper "Business Process Outsourcing" is a perfect example of a literature review on business. Business Process Outsourcing (BPO) refers to a practice whereby a firm contracts some of its processes to a provider who offers third-party services. Initially, this process was mostly utilized by manufacturing firms, which used to outsource various segments of their supply chain. BPO mostly targets both back office and front office operations. Back office operations mostly target the internal functions of a firm, such as finance, accounting, and human resources. Front office operations normally target services that are related to clients, such as those offered through a contact center.
Offshore outsourcing mostly comprises of contracting BPO services to a company that is situated outside a given country, while near-shore offshoring describes BPO contracting to a country that is close by. Most BPO contracts are normally based on information technology. For instance, the Philippines overcame India as the biggest outsourcing industry around the world (Halvey & Melby, 2007). This paper will discuss the BPO initiative by Jetstar Australia, and the benefits and drawbacks that it realizes as a result. Jetstar Airways Overview Jetstar Airways an organization that specializes in the provision of low-cost air services in Australia.
The headquarters for the company are situated in Melbourne, Australia and it is a fully-owned subsidiary by Qantas. The company was established to cater to the threat that Virgin Blue low-cost strategy posed in the region. The firm emanates from the two brand strategies by Qantas, whereby Qantas Airways provides premium services in the marketplace whereas Jetstar provides airline services for the low-cost segment. Jetstar airways provide a broad range of products to cater to the domestic, regional, as well as global services from the major base at Melbourne Airport.
It uses a broad range of fleet airlines, which include Boeing 787 Dreamliner, Airbus A330 and Airbus A320 airplanes. Just like its Qantas parent, the company rivals with Virgin Australia. The company also has various sister airlines, which include; Valuair, Jetstar Japan, Jetstar Asia Airways, Jetstar Hong Kong, and Jetstar Pacific Airlines (Bamber, Gittell, & Kochan, 2013). Jetstar Business Process Outsourcing For Jetstar, it prefers the Philippines business process outsourcing industry, since it has emerged as one of the pillars for a company’ s growth.
The industry has been witnessing tremendous growth in the past 10 years, and at a rate of 46 percent since 2006. In 2013, the BPO industry witnessed 26 percent growth and managed to generate exports amounting to $9 billion. The major reasons as to why Jetstar prefers this region is because the labor costs are significantly low, the workforce practices positive employment ethics, the professionals are highly skilled, and globally competitive, and portray high proficiency in the English language. The Philippines is highly accustomed to diverse western traditions and customers, and its strategic location has made it an appealing outsourcing destination on the planet.
With this form of cultural compatibility, the region ensures that Jetstar is capable of coordinating, directing, as well as communicating easily (Contact Center World, 2011). Jetstar regards his suppliers as a source of investment, where it is capable of spreading its risks, thereby allowing it to witness various high paying dividends unlike the case of other airlines. For Jetstar, it currently operates with five IT personnel on a full-time basis whose role is to manage various outsourcing associates comprising of Sonnet (desktops), IBM check-in), iGate (development of applications), Telstra (telecommunications), Zensar (BPO and application development), and CapGemini (a data warehouse).
The company also partners with other suppliers, such as PM Partners (managing projects), 4looop (Middleware), Sissit (research and development for SMS), and Vadaleon (developing applications for Airport and Airlines) (Contact Center World, 2011).
Asefeso, A. (2011). Business Process Outsourcing Unleashed. London: AA Global Sourcing Ltd.
Bamber, G. J., Gittell, J. H., & Kochan, T. A. (2013). Up In the Air: How Airlines Can Improve Performance by Engaging Their Employees. London: Cornell University Press.
ContactCenterWorld. (2011). Jetstar to Transfer 400 Airline Jobs to Philippines. Retrieved from http://www.contactcenterworld.com/view/contact-center-news/jetstar-to-transfer-400-airline-jobs-to-philippines.aspx
Halvey, J. K., & Melby, M. B. (2007). Business Process Outsourcing: Process, Strategies, and Contracts. New York: John Wiley & Sons.