Dec 15, 2016
Swiss Post Solutions (SPS) recently invited the analyst community to its Industry Analyst Symposium held in Vietnam on November 23-26. During this multi-day symposium, SPS’ senior management briefed analysts on the SPS business, its latest technology innovations, as well as on its Business Process Outsourcing (BPO) strategy. Analysts were also invited for site visits to both of its Vietnam offshore facilities in Ho Chi Minh City and Can Tho City. This blog post covers our takeaways from the event.
SPS is one of six executive units within the Swiss Post Group and one of the largest global document management solutions providers. In 2015, SPS accounted for 6.4% of the group’s total operating income with CHF 609 million in 2015. This decline of about 7% compared to 2014 mainly reflected the negative impact of the change in monetary policy by the Swiss National Bank early 2015. With its 7,500+ employees worldwide, SPS manages 450+ mailrooms, scans 1 billion documents each year, prints 1.2 billion statements, invoices, and checks annually, and offers BPO services ranging from mailroom services to document input/output processing and intelligent document process automation. Its key markets today are banking/financial services, insurance, and telecommunications across Switzerland, Germany, the UK, and the US.
Vietnam as an offshore opportunity
With rising labor cost, property costs, and inflation, leading offshore markets China and India are facing increased competition from emerging markets such as Vietnam. There are several characteristics that comprise the value proposition for Vietnam as an offshore country. These characteristics include:
- Low labor costs (about half of the labor cost in China)
- A young and technology-friendly population (the average is around 30 years and digitally savvy)
- A growing services sector (representing about 44% of its GDP in 2015)
- An attractive ICT industry (government tax incentives)
- An improving educational system (language skills and business education)
SPS in Vietnam
SPS established its first offshore facility in Vietnam in 2004 when it took a 100% Foreign Direct Investment in GHP Far East Co. (renamed to SPS in 2013), which initially served German businesses as an IT outsourcing partner. Today, SPS holds two offshore facilities in Vietnam with locations in Ho Chi Minh City and Can Tho City. It employs 1,035 employees in a 24/7/365 operation that processes 1 million documents per day.
Managing 1 million documents per day
To ensure business continuity for its clients, SPS recently opened a new Network Operating Center where all document processes are monitored for the 100+ clients for whom they manage document processes in Vietnam. Workload, SLAs (Service Level Agreements), and other potential problem areas are identified earlier due to the Network Operating Center and resolved before becoming a real issue.
Quality is of paramount importance to SPS and the company continues to invest in this to maintain and improve quality standards. Both offshore sites in Vietnam are CMMI3 compliant (Capability Maturity Model Integration) and have several ISO certifications:
- ISO9001:2008 (covering Quality Management)
- ISO/IEC27001:2013 (covering Information Security Management System)
- ISO/IEC20000 (covering IT Management Services).
Announcing a Service Center Banking Platform for Swiss Customers
At the event, SPS announced a new offering for the banking industry: Service Center Banking. This platform will offer document management and business process services, including intelligent payment processing capabilities to its Swiss banking customers. SPS suggested that other industries will be supported in the future, including healthcare and insurance. The core of the Service Center Banking platform is an artificial intelligent (AI) cloud, which is hosted in Switzerland and based on the recently announced partnership with Celaton, an AI software company. While Celaton already hosts an AI-cloud in the UK today, Swiss banks require that business and customer data does not leave the country.
Investing in Robotic Process Automation and Artificial Intelligence
In his opening presentation, SPS CEO Jörg Vollmer emphasized the impact of intelligent automation on the BPO industry. New innovations, such as Robotic Process Automation (RPA), AI, and cognitive computing continue to bring further cost savings, higher quality levels, and faster processing times. The recent partnership with Celaton reflects the importance of ongoing technology innovations for SPS.
Vollmer was explaining SPS’s vision as “connecting the physical and digital worlds.” As inbound and outbound communications are growing together, it is all about avoiding going from a paper-based workflow to a digital workflow and vice versa, Vollmer further explained. SPS’s AI revenues are estimated at a modest $3 million USD in 2016, but are expected to grow strongly in the coming years. A dedicated team of process engineers, implementation specialists, pre-sales specialists, and marketers are building on making these investments a success.
The impact of intelligent automation can already be seen within the manufacturing industry, where production value chains and associated processes are becoming more effective and highly productive. Now intelligent automation is also impacting the BPO industry with RPA, AI, and cognitive computing as leading technologies.
Investing in intelligent automation is the right way forward for SPS if they are to further differentiate from the competition. A differentiator within the BPO industry will become shifting from labor costs to owning expertise and capabilities in intelligent automation.
Associate Director, Customer Communications Advisory Services
Within our Customer Communications Advisory Services we closely track the Customer Communications market. Through our annual primary research, forecasts, and ongoing industry coverage we provide trends and deep insights for vendors, service providers, as well as for businesses. For more information, please contact Deanna Flanick at email@example.com.
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