A Framework for Evaluating the Impact of Business Process Outsourcing on the Operational Performance of the Mobile Telecommunications Industry, South Africa

Mobile telecommunications service providers outsource a range of activities like logistics, assembly operations, manufacturing and design. However, little research has been conducted to empirically evaluate the impact of business process outsourcing (BPO) on the company's operational performance. This research tried to redress the existing knowledge gap and the limited body of literature by proposing a framework to evaluate the impact of BPO in the mobile telecommunications industry using cost and profitability as the underpinning quantitative performance measurements. A structured closed-ended questionnaire was used to collect raw data from 210 employees. Descriptive and chi-square tests were conducted to establish the statistically significant relationship between business process outsourcing and the operational performance of mobile telecommunications. The results reflected a statistically significant relationship between implementation of BPO and cost and profitability. The results will help the corporate management to make decisions of outsourcing based on quantifiable metrics instead of managerial estimates. While the study confined itself to the mobile telecommunications companies, more research can be conducted in other South African industries most notably banks, hospitals, car assembling and learning institutions that are also important BPO hubs worthy of further examination.