For governments, it is imperative to bring down the costs of administering a growing number of public services. Since the 1800s, governments have funded law enforcement, water, electricity, town planning, health services, public transport and education. Today, governments must also provide their citizens with waste management services, telecommunications, environmental protection, public housing etc.
Taxpayer money, of course, has to fund these services. And their demand is growing at a menacing pace. According to OECD data, in the US, for example, public spending accounted for almost half of all health spending in 2010.
Business process as a service (BPaaS) is rapidly emerging as an effective way to lower the cost of administration because it:
- Provides access to best-in-class solutions, processes and technologies
- Can scale to meet volumes without a proportionate increase in costs (pay-as-you-go model)
- Can create customized solutions for increased efficiencies
- Eliminates the need for large capital investments
- Reduces operational costs
- Enables a variety of convenient engagement models
Like software as a service (SaaS), service providers are packaging and delivering business processes using hybrid models (offshore-onshore-onsite, private cloud, public cloud, hybrid). Processes that are moving from packaged applications to standardized, repeatable, service-oriented, cloud-based BPaaS include:
- Email and communication management
- Human resource management
- Finance and accounting
- Supply chain management
- Risk management and compliance
- Purchase order processing
- Claims processing
- Shipping, etc.
The key characteristic of BPaaS, enabled by cloud environments, is vast scalability. BPaaS offerings can start with a few customers and less than a dozen processes and grow to literally hundreds of customers with thousands of processes. BPaaS also supports multiple languages and a plethora of deployment scenarios.
This is exactly what governments across the world need.
Governments are already using BPaaS successfully
Several governments are using BPaaS to improve citizen services and lower costs. A Canadian province, for example, is using BPaaS to power a search engine that matches a request for a driver’s licences to nearby offices that deliver the service. All the providers of the service share the same software, consuming it at a business process level. BPaaS also them to share costs, lower the cost of maintenance, enjoy higher efficiencies and receive consistency of the information they provide to citizens.
The UK Government has established a Shared Business Services model that uses BPaaS to address business efficiency and cost challenges. According to its implementers, the model has been delivering operational efficiency, real cash releasing savings and added value services of more than 40 percent.
The key reason for BPaaS gaining traction should be apparent: BPaaS lets governments leverage BPO processes and SaaS from a single provider. This reduces costs and management and integration overheads. It also ensures that a single entity is responsible for the delivery of services in accordance with service metrics.
BPaaS is a high-growth segment. As cloud technology finds widespread acceptance and deployment, BPaaS will continue to balloon. Governments are noting this trend. As they begin to demonstrate familiarity with new IT service delivery models and get a better handle on the different cost models, BPaaS will find its way increasingly into the delivery of public services.
So how do you think BPaaS can be a boon to health systems in your geography?