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Enabling Document Process Outsourcing in the Corporate Document Enterprise

Introduction

Today's corporate organizations are moving faster than ever before to optimize their operationally-necessary business processes, including document business processes. As they do so, they are discovering that they lack the fundamental knowledge and insight required to fully optimize their document processes. The challenge is to understand the total document process, optimize it, and outsource the entire process to an external provider.

InfoTrends/CAP Ventures has begun sizing and tracking a new segment of the document outsourcing market – the outsourcing of document-intensive business processes. It has coined the term “Document Process Outsourcing” (DPO) to describe this emerging document services model.

InfoTrends/CAP Ventures’ new white paper entitled Enabling Document Process Outsourcing in the Corporate Document Enterprise examines this dynamic environment and provides a road map for service providers and corporate organizations wishing to implement successful Document Process Outsourcing.

Defining DPO

InfoTrends/CAP Ventures defines DPO as the assignment of an entire document-intensive business process to an external provider. An engagement typically has three major stakeholders:

The DPO service provider: takes over, optimizes, and operates the document process.  
The DPO customer: contacts directly with the service provider and outsources the document process in question.  

The end-user: the ultimate recipient of the document or set of documents produced by the document process. Examples include consumers, government agencies, suppliers, business partners, distributors, employees, and shareholders.

A number of conditions must be met for a DPO engagement to exist. These conditions include a document business process that can be fully outsourced and a business process that results in the production of an electronic or hard copy document.

The DPO Opportunity: Market Sizing

The DPO market is expected to grow very aggressively in the United States and Europe. This growth is expected to come from a small base and at the expense of more traditional document outsourcing market segments, such as facilities management and contracted print services.

According to InfoTrends/CAP Ventures’ U.S. Document Outsourcing Market Forecast 2003-2008, DPO revenue as a percentage of the document outsourcing market will increase much faster than all three traditional segments (facilities management, statement printing, and contract print services), reaching just over $1.5 billion and accounting for 4.3% of total market revenue in 2008. Growth rates are expected to be in the range of 12%-16% for the next three years, which then accelerates to about 24.1% growth in 2008.

Figure 1: U.S. Document Process Outsourcing Environment Forecast ($ Millions)

According to InfoTrends/CAP Ventures’ Western European Document Outsourcing Market Forecast 2003-2008, about €421 million (2.3%) of the €18.2 billion Western European document outsourcing market can be attributed to Document Process Outsourcing as of 2003. This segment is expected to grow even faster than the DPO market in the U.S., reaching just over €2 billion and accounting for 8.5% of total market revenue in 2008. Growth rates are expected to be as high as 58% toward the later half of this decade.

Figure 2: Western European Document Process Outsourcing
Environment Forecast (€ Millions)

Structuring a Successful DPO Engagement

While the movement toward document process outsourcing continues to gain momentum in the market, real and perceived inhibitors exist. Although outsourcing can offer internal staff new and expanded career opportunities, it is still viewed by many as the grim reaper, akin to corporate downsizing or rightsizing. Another common outsourcing myth is that it implies that a current internal group (IT or document management) is inefficient or ineffective. Effectively completing a structured plan for implementation will most likely ensure a smooth transition. 

Other common concerns are fear of knowledge transfer and loss of control. Many also worry that the outsourcing engagement may not produce the level of savings anticipated, and that backing out of such an engagement may prove difficult. While the danger of such scenarios may occur in a poorly designed or executed outsourcing arrangement, they do not happen in the vast majority of solid outsourcing contracts.

The preceding is an excerpt from InfoTrends/CAP Ventures’ report entitled Enabling Document Outsourcing in the Corporate Document Enterprise. The complete document is available immediately for purchase. For more information on the report or to make a purchase, please contact Alison Hipp at , ext. 126 or or visit www.infotrendsresearch.com and click on the reports icon.