HP Clones P&Gs Cincinnati Accounting Ops in India

This behind-the-scenes look at the inner workings of the Procter & Gamble finance and accounting outsourcing deal with HP-which was signed in April 2004-is the result of an eWEEK investigation of India's technology hubs in Bangalore and Mumbai.

Bangalore, India, is a booming, sprawling metropolis. You can find almost anything here. You can even find a piece of Cincinnati if you know where to look.

If you work at the Hewlett-Packard center handling BPO (business process outsourcing) for Procter & Gamble, you spend your day in as close an approximation of P&Gs Cincinnati headquarters as exists in South Asia, or almost anywhere outside Ohio.

It exists because HP, based in Palo Alto, Calif., has taken to heart the notion of bonding with the client—at least in part by emulating the clients physical location.

This behind-the-scenes look at the inner workings of the P&G finance and accounting outsourcing deal with HP—which was signed in April 2004—is the result of an eWEEK investigation of Indias technology hubs in Bangalore and Mumbai.

P&G refused to comment on work that is being done at HPs BPO centers in India and elsewhere.

As enterprises move to outsource critical business processes such as accounts payable, finance and accounting, human resources, procurement, and customer service, issues of corporate culture and brands may come into play, along with the necessities of quality of service and best practices.

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For example, many walls of HPs BPO center here are festooned with posters recalling both P&G and its home in Cincinnati. All the better to give HP workers a sense of oneness with "the company." When its time to huddle, workers head for the William Procter meeting room.

The 140 or so HP staffers are also split into teams, each carrying the name of a P&G product. Walk around the floor, and youll find yourself in the precinct of the "Dash" team, the "Gain" team, the "Lacoste" team, and so on.

Each team manages business processes in a different group of countries and tries to outdo the other teams for the best record of quality and quantity of accounts payable transactions processed.

Its ironic that two well-established American companies had to go nearly halfway around the world to get close to each other. In terms of corporate DNA, both companies were never that far apart to begin with.

"There are lots of similarities between cultures," said Arunkumar Srinivasan, operations manager for HP BPO. HP seeks to bring its "Rules of the Garage" to the table, while P&G asserts its own "Values and Principles," he said. Both sets of guidelines stress integrity, trust and competitiveness.

Fostering the feeling of oneness is critical for both partners of this deal. P&G wants its accounts payable done in a manner that represents its interests and practices as closely as possible, in a way that is transparent to its suppliers.

And with the global BPO market exploding, it behooves HP to get it right with P&G and other current customers and then replicate the best practices with other clients.

This transparent integration may be critical to the growth of BPO. A study by McKinsey & Co., of New York, that was commissioned by Nasscom, an Indian software and services providers association, found the current worldwide offshore BPO market to be $11.5 billion. The potential market, however, is between $120 billion and $150 billion, the study said.

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