Globalization continues to create new and improved ways to do things. Accessible internet services like Spectrum Specials or ride-hailing services like Uber are good examples. And in many instances, these new approaches can often give birth to entirely new and specialized industries. One such instance is the BPO services industry. BPO or business process outsourcing is a booming sector that caters to a range of corporate needs involving outsourcing.
Almost every business outsources certain types of work. Of course, it may not always fit the typical perception of offshore outsourcing. But being aware of what BPO is and how it works may prove valuable in leveraging greater business success. Read on to learn more.
The Essentials of Understanding BPO Services
BPO is a type of B2B outsourcing. It involves one business delegating the execution of a certain process to an entirely different business offering BPO services. Businesses typically outsource a range of processes like HR, payroll management, IT infrastructure, bookkeeping, and many others. However, these only represent one common type of BPO service known as “back-office” processes. There is another type of BPO known as “front-office”.
Outsourcing first emerged in the 1970s. With consumer goods in great demand amid more relaxed market regulations, businesses rushed into manufacturing them. Of course, businesses have expenses, and when costs run too high they eat into profits. Outsourcing was a great way to help these businesses become more efficient, and execute various processes at a lower cost. Your business could gain several key advantages in exploring a BPO service partner, including:
Reducing Costs and Wastage
The biggest advantage you get with BPO services is also its strongest selling point. It reduces costs significantly. Offshore BPO is almost always more cost-effective than maintaining a process in-house. But outsourcing a process inland can also help businesses cut costs significantly. The idea is simple. And the in-house process would involve floor space, overhead, recruitment and payroll costs, and many other associated expenses. Even after significant spending, there may not be a guarantee of success. A BPO service partner, however, would take on all the responsibilities associated with setting up and managing the process. All you have to do is pay for the service.
Another key feature of a good BPO partner is flexibility and scalability. Many BPO service providers have a large number of human or tech resources to deploy on the specialized process. And you may not always be their only customer. That means they can offer a lot more flexibility and scalability than you would get managing a process in-house. BPO services can scale up and down as you need. And you can also sign up for additional services with BPO service providers with broader capabilities.
Establishing a Global Foothold
A good motivator to examine the BPO model is the chance to create a global footprint. Most businesses are always on the lookout for new markets and opportunities to expand. An offshore BPO partner could carry out strategic services under your brand name. This could help you establish a presence beyond international borders. You can choose to market your global presence to add to your business portfolio and prestige as an added bonus.
Faster and More Efficient Results
BPO service providers thrive on high performance and efficient execution. This isn’t just a good work ethic. BPO providers look to shave off as many wastages and inefficiencies as possible to flesh out their own bottom lines on service revenues. That means they are going to explore every way and refine every approach to make the process as efficient as possible. And they will almost always try to perform beyond what you expect in order to retain your services.
Focus on The Most Essential Parts of Business
Business leaders are often forced to wear many hats. They have to be good managers, know how to spot and reward talent and keep their teams on track. They are entrepreneurs, accountants, recruiters, quality managers, and even production supervisors. Sometimes all at the same time! With only a limited number of hours in any day, this can often direct their focus away from many of the core aspects of businesses that require their attention the most.
Your core business processes are typically the ones that contribute most to business success. However, there may be many other processes that are essential, but not crucial to revenue generation. Processes like payroll management, bookkeeping, administration, or even customer support are mostly support processes. They don’t always relate directly to revenue generation. And many, like IT administration, require specialized technical knowledge.