Buyers increasingly realize the need to look at operation, business application, and technology infrastructure cost in a holistic and integrated way. This would address the total cost of service delivery rather than just FTE / operational cost. In response to this, third-party providers are focusing on innovations that address this need as well as create a scalable, non-FTE-linked growth model for them. Business-Process-as-a-Service (BPaaS) is one such model. It is fundamentally different from traditional models as it seeks to converge labor arbitrage value proposition at the operational layer, Software-as-a-Service (SaaS) concept at the business application layer, and Infrastructure-as-a-Service (IaaS) construct at the technology infrastructure layer in an integrated manner.
BPaaS is a sourcing model where buyers receive standardized business process services on a pay-as-you-go basis by accessing a shared set of resources (people, application, and infrastructure) from a single provider. Given the fundamental differences compared to the traditional business process outsourcing (BPO) as well as the information technology (IT)+BPO model, a different approach is required to evaluate, select, and implement a BPaaS model.
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