In business, the cost is a major consideration. Utility, equipment, raw material, and other costs are things that owners and management work to keep as low as possible. But as we all know, since businesses must cover these operational costs, we can’t completely do away with them. Without investing in technology, office space, and human resources, to name a few, a firm cannot continue to run or operate.
Moreover, you’ll need more aid if you run a large business with several departments and a variety of goods and services. Thankfully, there is an option to hire and employ individuals directly under your organization to help you out, and that is through business process outsourcing. You’d be astonished at how many advantages using outsourced services might provide you.
Business Process Outsourcing (BPO)
Business process outsourcing (BPO) began when businesses discovered the cost-efficient benefits of contracting out work to third parties in both front- and back-office operations previously performed in-house.
Companies of all sizes, from start-ups to multinational corporations, are taking advantage of the low overhead, specialization, and flexibility of outsourcing non-core functions; thus, allowing businesses to focus on their growth strategies.
More and more businesses entrust critical office functions to their BPO partners. Industries including banking, recruitment, graphic design, maintenance, and legal services have invested in outsourcing. Thus, this demonstrates how far BPO has progressed, with manufacturing companies being early adopters.
In short, Business process outsourcing or BPO is a strategy companies use to accelerate their growth that entails hiring third-party service providers to perform less critical business functions on their behalf.
Top Benefits of Business Process Outsourcing
BPO makes operations easier to manage. Third-party providers, as experts in business processes, bring specialized knowledge or skills that you might not have access to otherwise.
Professionals with Prior Experience
Industry professionals with excellent educational and professional backgrounds make up the BPO workforce. They have the knowledge, capability, and values, making them uniquely qualified to meet your staffing requirements.
Improvements in Technology
BPO companies invest heavily in new software and tools to improve their services. With better results, your company can easily keep up with the market trends and address current and potential challenges.
As you outsource less critical processes to BPO companies, your organization’s marketability will generally improve. That is because you’ll be able to turn ideas into high-demand products and services faster.
According to Deloitte, the primary reason for 70% of BPO clients partnering with third-party service providers is cost reduction. Labor costs are lower in developing countries, where many BPO companies are located; therefore, helping you save money on overhead. BPO services also include the use of the provider’s office space and IT infrastructure, which saves your company money.
Expansion Around the World
Outsourcing eliminates the difficulties that come with starting a business in a new market, location, or environment. You can establish yourself in a new community while adhering to legal and professional standards with the help of a BPO provider.
Types of BPO Services
- KPO (Knowledge Process Outsourcing) – The outsourcing provider is tapped for a specific field that is highly knowledge-based, such as education, finance, healthcare, insurance, and engineering.
- ITES (Information Technology Enabled Services) – BPO has also been known for its information technology-enabled services, given the importance of IT infrastructure in outsourcing. ITES BPO specializes in providing support to businesses in processing large amounts of data. Some of the most common applications for ITES include helpdesks, customer support centers, and data warehouses.
- RPO (Research Process Outsourcing) – This type of BPO focuses on research functions. Pharmaceuticals, investment firms, and marketing firms are examples of companies that hire a BPO partner for RPO services.
- LPO (Legal Process Outsourcing) – This service involves performing legal functions like research, preparation of documents, and legal advice. Your HR and regulatory compliance can avail of LPO services.
BPO Market Trends You Should Know
Increased Customer Diversity
It was once common to believe that BPO was solely concerned with call centers, but this is no longer the case. It has evolved into a segmented industry with a diverse customer base that recognizes the value that BPO services provide. From private corporations to non-profit organizations and government agencies, various groups now outsource to third-party providers.
Emerging Technology Investments
As we further thrive in the digital age BPO firms are expected to stay on top of new technologies that can help their clients cut costs, improve productivity, and be more responsive to customer needs.
Workforce Reskilling and Upskilling
With automation becoming more prevalent, employees performing routine tasks should reinvent themselves to meet the demand for a more highly skilled workforce.
While BPO automation has the potential to displace low-skilled workers, new job roles are bound to emerge. The emphasis is on the employees’ skill development to perform creative and critical thinking processes to help BPO clients accelerate business growth.
Partnerships Between Start-ups and BPO
BPO has leveled the playing field for start-ups. The industry can provide them with the technology, expertise, or opportunities to grow that would have been otherwise difficult to obtain.
Experience Growth with Outsourcing
In summary, the Business Processing Outsourcing model can be critical to the growth of a company. BPO has given businesses of all shapes and sizes a great deal of flexibility in how they run their operations. When you outsource a portion of your tasks to a professional BPO provider, you can save money and improve your productivity.