UnderstandingBusinessProcessOutsourcinginInvestmentBankingFSLab/CapGeminiErnst&YoungDecember2002FSLAB-2-FSLabL_02Dec02_BPO_IB_nmCapGeminiErnst&Young•ProprietaryandConfidentialContents•ObjectivesandApproach•ExecutiveSummary•BusinessProcessOutsourcing(BPO)TrendsinInvestmentBanking•OperationalImplementationofBPOinInvestmentBanking•BenchmarkofCurrentBPOInitiativesinInvestmentBanking•ConclusionsandRecommendationsforSocieteGenerale•Appendices-3-FSLabL_02Dec02_BPO_IB_nmCapGeminiErnst&Young•ProprietaryandConfidentialWehaveassessedtheBPOmarketwithintheInvestmentBankingindustryObjectivesObjectives•ProvidesomeexamplesofthecurrentinitiativesimplementedbySocieteGenerale’scompetitors•ExplainhowcanInvestmentBankstakethebestadvantageofBPOofferings•AssessthepotentialforSocieteGeneraletouseBPO•ProvideadefinitionofBusinessProcessOutsourcing(BPO)•GiveanoverviewofBPOmarkettrendsandofferings•ExplainthedifferentoperatingBPOmodels•Understandthemaindrivers,benefitsandrisksofthedifferentoutsourcingoptions•ProvidesomeexamplesofthecurrentinitiativesimplementedbySocieteGenerale’scompetitors•ExplainhowcanInvestmentBankstakethebestadvantageofBPOofferings•AssessthepotentialforSocieteGeneraletouseBPO•ProvideadefinitionofBusinessProcessOutsourcing(BPO)•GiveanoverviewofBPOmarkettrendsandofferings•ExplainthedifferentoperatingBPOmodels•Understandthemaindrivers,benefitsandrisksofthedifferentoutsourcingoptionsApproachApproachHypothesesGenerationRecommendationsOpportunitiesforSocieteGenerale(SG)toimproveitsperformancebyusingBPOcapabilitiesOpportunitiesforSocieteGenerale(SG)toimproveitsperformancebyusingBPOcapabilitiesResearchBPOinInvestmentBankingisafastgrowingmarketthatcoversanincreasingnumberofbusinessareasBPOinInvestmentBankingisafastgrowingmarketthatcoversanincreasingnumberofbusinessareasInvestmentBanksmustcarefullyselectBPOoptionsandoperatingmodelsinordertomaximisethebenefitsfromBPOinitiativesandsuccessfully‘variabilise’theircostbaseInvestmentBanksmustcarefullyselectBPOoptionsandoperatingmodelsinordertomaximisethebenefitsfromBPOinitiativesandsuccessfully‘variabilise’theircostbaseExternalSecondarySourcesExternalSecondarySourcesCGE&YPreviousPoVsCGE&YPreviousPoVsWeaimtounderstandwhataretheopportunitiesforSGtouseBPO.WeaimtounderstandwhataretheopportunitiesforSGtouseBPO.OBJECTIVESANDAPPROACHExecutiveSummary-5-FSLabL_02Dec02_BPO_IB_nmCapGeminiErnst&Young•ProprietaryandConfidentialBPOinFinancialServicesisalucrativeandfastgrowingmarketestimatedtobeworth$43bnDriversforBPOMarketGrowthinFinancialServicesDriversforBPOMarketGrowthinFinancialServices•Decreasingcustomerloyalty•Highfixedcosts•Increasedover-capacity•Increasingmarketvolatility•Increasingneedfornewtechnologies•Increasingfocusoncorecompetencies•IncreasingregulatoryrequirementsEstimatedBPORevenueForecastsinFSSector2000–2005($million)EstimatedBPORevenueForecastsinFSSector2000–2005($million)CAGR(2000–05)=10,8%20002001200220032004200534,47837,77441,28447,39952,83257,598Onanoperationallevel,BPOcanbeimplementedusingdifferentschemes.Onanoperationallevel,BPOcanbeimplementedusingdifferentschemes.AnIDCresearchaboutBPOinEuropeindicatesthatBPOinbankingsectorshouldgrowbyaround15.3%CAGR(2000-2006)Source:“BPOexpectedtoGrowto$58bninFinancialServicesby2005”,Gartner,26/07/2002;EuropeanBusinessProcessOutsourcing(BPO)Forecast&Analysis,...
