Deciding whether to outsource a key business function like document process management can be a tough call. Sure, it’s tempting to offload mail, copy/print, fleet management, records management and eDiscovery, but will it pay off?

Now you can know. The calculus is easy when you, the prospective client, can monitor the ongoing performance of the outsourcing service provider with absolute transparency and mathematical certainty. Think of a cardiologist using an EKG to track real-time objective heart performance. With a similar level of insight into your service provider’s performance, you’d have little to worry about.

Too many clients have been forced to wait for monthly or quarterly hard copy reports to get information they can act on. Especially in this challenging economy, a service provider should be providing direct access to rich performance data that proves the value of its services. If it can’t prove the value, the provider should be prepared to pay a penalty or lose the contract.

To obtain an EKG for document process outsourcing, find providers that do business process management. BPM entails tracking agreed-upon metrics that roll up into an interactive Balanced Business Scorecard, which represents the total bill of health for document process operations. The Balanced Business Scorecard considers not only current financial performance but also strategic objectives like customer satisfaction, human resource development and refinement of best practices. Without these other pillars of a healthy business, financial performance won’t last long.

Each objective in the Balanced Business Scorecard – HR, finance, the customer and operations – gets a grade. The grade reflects metrics around discrete microactivities that take place in pursuit of strategic objectives, e.g., like on-time print volume, or transcript production within a three-minute window, device uptime, or any of a million others. These activities are what a BPM system is monitoring in the same way an EKG is tracking the heartbeat’s P wave, QRS complex and T wave. The scorecard framework rolls up the metrics and as a whole helps ensure that the operations align with strategy.

Getting to the interactive Balanced Business Scorecard requires a little forethought:

• Establish strategic performance objectives for the outsourced service.
• Identify processes that drive those objectives.
• Isolate important variables in these processes.
• Define acceptable performance levels for each variable.
• Craft a service level agreement (SLA) that details the key performance indicators (KPIs) and the targets.
• Monitor those key performance indicators in real time, or nearly so.

An Organizational “Bill of Health”
This framework forms the architecture of a BPM dashboard, a Web-based computer interface that managers on both sides of the outsourcing relationship can use to monitor the current business performance. Users can drill from the 60,000-foot level of a given service area down to the atomic level of any discrete microactivity.

Through this intelligence-packed dashboard, managers can monitor document operations down to the device, staffer or resource level, and drill horizontally back and forth through time. As a result, companies can gauge their performance 24 x 7 x 365, and continuously improve it.

If performance in a particular site shows up as “blue” or excellent on the dashboard, the company can replicate this best practice across all sites and functions. If, on the other hand, one site or process is struggling in the red zone, the company can pinpoint the problem and launch a quality initiative – anything from a short staff meeting or revision to a form to a full-fledged Six Sigma project – until the process meets standards.

Although BPM is always valuable, the recession intensifies the need for organizations to do everything in their power to cut costs and improve business results. Consequently, ensuring that outsourced operations like document processes pay off can be a matter of survival.

F. Stephen Olson (stephen.olson@oce.com) is National Director, Best Practices, Océ Business Services.