Business Process Outsourcing Industry: A Lean-Agile Performance Model Validation

Abstract

In recent past, performance measurement of a business process outsource company had mostly been discussed from cost and quality perspectives which are core attributes of lean and agile performance process. Establishing on contingency theory, this study analyze performance measurement of different companies in business process outsource industry. Hence, this study seek to find out if the performance of a business process outsource company can be measured by combination of lean and agile method. To test the hypotheses, we analyze different variability that a business process company faces, how lean and agile have been used in other industry to address such variability and discuss the result using a predictive multiple regression analysis on data collected from companies in Malaysia. The findings from this study revealed that while each method has its own advantage, a business process outsource company could achieve more (up to 87%) increase in performance level by developing a growth strategy which focuses on a perfect mixture of lean and agile methods. Secondly, this study shows that performance indicator could be better evaluated with non-metrics variables of agile method. Thirdly, this study also shows that business process outsource company could perform better when they concentrate more on strengthening internal process integration of employees.