What Every BPO Client’s List Should Include

The process of outsourcing a business function seems simple—you seek a service provider, pay a fixed fee, and wait for submitted outputs within a time frame.

However, business process outsourcing (BPO) requires numerous considerations to ensure long-term success. You must specify your targets, required skills, and needed services before hiring the right BPO company. You must also define your outsourcing budget and develop a management plan.

If you are considering outsourcing, this guide is for you. It explores key aspects of outsourcing that every prospective BPO client must list before their business venture.

Why Must BPO Clients Create a List?

BPO clients—whether small businesses or large enterprises—must draft a list before outsourcing any of their non-core functions to achieve benefits in the long run. This strategy guides you in making informed decisions, addressing potential risks, and identifying the best BPO partner.

Although you can hire a third party for short-term projects, BPO requires long-term planning if you aim to build a gainful partnership with your provider and guarantee continued business success. Planning ensures you and your potential partner match work strategies, goals, and outcomes. 

Unconvinced about the power of a well-structured plan when acquiring BPO services? A Deloitte survey found that 88% of respondents achieved a cost reduction after hiring a third-party partner. An outsourcing plan is crucial to achieving this goal because it gives you financial predictability, letting you manage your budget more effectively and accurately. 

Having a list of your outsourcing needs also lets you experience the following advantages: 

• Determine and address outsourcing-related risks beforehand.
• Establish metrics to measure the BPO company’s achievements.
• Scale operations with a provider based on changing requirements.
• Secure a reference point for reviewing goals, expectations, and deliverables.
• Prioritize improving primary products and services.

Six Things a BPO Client’s List Must Have

After understanding what the BPO plan’s importance is, let us discuss its specifics. Consider these factors the building blocks of a successful partnership with a business process outsourcing firm—each contributes to your overall growth. Continue reading, and let us walk you through the basics of a BPO client’s list.

1. Set of BPO Goals

Defining your objectives is the first and most critical step when searching for business process outsourcing companies to work with. This approach ensures your potential provider’s goals align with your business targets. 

Having a set of BPO goals also helps clarify what you want to attain when entrusting specific tasks to a vendor. For instance, Google intends to improve its outsourcing practices as part of its cost-saving objectives for 2023.

The tech giant wants to cut operating costs significantly, from software to equipment and professional services. Thus, the company has been rolling out an enhanced acquisition center to help its teams seek suppliers offering affordable, competitive pricing.

Similarly, you must specify your goals to guarantee long-term success with an outsourcing company. Do note that your goals must be flexible. You and your BPO partner should continuously update your objectives based on changing industry demands and innovations. 

Follow these simple methods to determine workable goals:

• Understand and assess business needs. Carefully analyze your existing processes. Determine pain points, bottlenecks, and areas of improvement. This step guides you in specifying your BPO goals.
• Identify key performance indicators (KPIs). KPIs serve as the foundation for your outsourcing objectives. For example, your KPIs should include cost savings percentages if you aim to cut your operating expenses through BPO.
• Prioritize goals. Remember that not all targets have equal importance. So, categorize your BPO targets based on their significance to your business. Some objectives are crucial for immediate advancement, while others are better achieved in the long run.
• Consider risks and contingencies. Remember to recognize potential risks and challenges that may impact the attainment of your goals. Draft contingency plans to resolve these issues and keep your BPO efforts on track.
• Involve key stakeholders. BPO clients should request help from key stakeholders, including department heads and decision-makers, to formulate their list of goals. Ensure everyone understands and accepts these objectives and their relevance to your growth.
• Communicate with the potential BPO partner. Relay insights about your goals when negotiating with a BPO firm. Lay out your objectives in your service-level agreements (SLAs) to ensure both parties are on the same page.

For a more effective BPO plan, set your goals based on the SMART guide. This model provides a framework for evaluating and boosting your BPO partnership over time. Make sure your outsourcing targets are:

• Specific: to focus on what you want to gain through outsourcing
• Measurable: to quantify your progress
• Achievable: to ensure initiatives are possible considering your available resources and time frame 
• Relevant: to ensure alignment of your BPO goals with your overall business objectives and priorities
• Time-bound: to add a sense of urgency and accountability

2. Outline of Needed Services

Before seeking a provider, include an outline of the services you in your BPO client’s list. As you evaluate your goal-setting needs, identify the front- and back-office functions you want to outsource. Consider these questions when doing so:

• What tasks take up a considerable amount of your internal resources?
• What specific processes are prone to errors and delays?
• What seasonal workload fluctuations could benefit from flexible staffing?
• Which functions can be standardized and documented for outsourcing purposes?
• What projects can the in-house team handle without any issues?

Analyze your business thoroughly during this step to avoid overlooked efforts and unexpected conflicts. Your plan should also include detailed service descriptions and expectations. Additionally, it should cover contract due dates, termination clauses, intellectual property rights, and dispute resolution mechanisms.

Do not forget to verify if the provider owns relevant technologies that meet your service and system requirements. A reliable third-party vendor should use or provide the necessary equipment in its service packages. 

Here are the different non-core functions you can assign to your provider for short- or long-term engagements:

• Customer support
• Finance and accounting
• Technical support
• Data entry and management
• Human resources (HR) support
• Legal and knowledge process outsourcing
• Healthcare assistance
• Sales and marketing
• Manufacturing 
• Transportation and logistics
• Retail and e-commerce support

3. Breakdown of Workforce Skills and Qualifications

After outlining your required functions of BPO, breaking down the third-party workforce’s ideal skills and qualifications is next and critical to ensuring high-quality output. These skilled professionals are usually more productive; they need less training and can quickly adapt to new processes. 

Hiring qualified third-party professionals helps address skills gaps; 17% of HR managers confirmed this in SHRM’s recent survey. For instance, if your gift shop urgently needs call center agents for the holiday rush, you can tap third-party experts capable of providing fast customer responses without comprehensive training. 

But before reaping such benefits, add your preferred workforce skills to your BPO client’s list to ensure you hire the best ones. Enumerate your ideal BPO professionals’ qualifications by implementing these strategies:

• Define the required skill levels for each function. The skill levels you need depend on a task’s complexity. For example, you might only need entry-level workers for basic marketing services, including social media content creation and moderation.
• Determine the number of workers needed per task. How many workers of similar skill sets do you require? Consider several factors to identify the right staffing levels for your BPO engagement. These aspects may cover workload, productivity, and expected output.
• Draft detailed job descriptions. Create a comprehensive list of qualifications for your required BPO roles and responsibilities. Job listings should cover the necessary skills, service scopes, and reporting structures.
• Specify quality standards that external workers must meet. These standards could include error rates, response times, and customer satisfaction scores. Implementing these metrics helps maintain service excellence in the long run.
• Identify any training needs for the BPO workforce. Discuss training setups with your potential service provider. Confirm whether the vendor will handle the training efforts or if your in-house team needs to host onboarding activities. Provide supporting materials, such as handbooks, and input on training schedules.
• Address security and compliance risks beforehand. Incorporate in your BPO client’s list the security and compliance measures that third-party workers must adhere to. This action is vital when tasks involve sensitive personal and financial account data. Indicate the required certifications or clearances.
• Review your list of skills and qualifications with key stakeholders. Consulting this list guarantees alignment with your overall business goals. Be open to feedback and make necessary adjustments.
• Include the breakdown of skills and qualifications in SLAs. You should add this list to your contract terms and conditions if you plan to work with a BPO provider for an extended period. This action ensures a shared understanding of workforce expectations.
• Establish mechanisms for continuous performance monitoring and feedback. This practice urges the service vendor to maintain expertise in the required skills and qualifications throughout the project.

To define the levels of expertise required when hiring contractors, consider the following aspects:

• Technical skills. What technical expertise does your business need? (e.g., programming languages and project management software proficiency)
• Industry knowledge. Does the task demand knowledge of specific industry regulations and standards? (e.g., Health Insurance Portability and Accountability Act of 1996)
• Soft skills. Are communication and problem-solving skills essential? (e.g., when procuring customer service outsourcing)
• Educational background. What educational attainment or certification is necessary? (e.g., Certified Information Systems Security Professional (CISSP) for technicians)
• Experience. How much relevant work experience is required? (e.g., mid-level expertise in leading a contact center team)
• Language proficiency. Do BPO professionals need to be fluent in specific languages? (e.g., Japanese to accommodate mobile phone customers from Japan.)

4. Layout of Budget Plans and Payment Options

Your BPO client’s list needs an outline of budget plans and payment options to assist you in controlling outsourcing-related costs. This framework overviews your in-house and BPO expenses, helping you avoid overspending.

A budget plan serves as your risk management tool. It lets you evaluate BPO’s financial impact on your business, such as whether the approach could save up to 70% in labor costs. Plus, it guides you in developing strategies to mitigate potential challenges, such as cost overruns and late fees. 

Ultimately, a clear blueprint of your outsourcing funds aids you in screening and selecting potential service vendors. You need to seek proposals from BPO companies. Then, compare their quotes to ensure your chosen provider meets your budget constraints. 

As you design your BPO client’s list, use these pointers when planning your budget and weighing your pricing selections.

• Create a clear and realistic budget for BPO initiatives. Take note of all relevant expenses when hiring a support vendor. The expenditures may include service and contract termination fees. Request a breakdown of service charges for more accurate estimations.
• Explore different payment options that suit your budget and financial goals. Below are the choices that BPO providers offer for their support service packages:
  • Fixed fee: a set amount paid monthly or annually
  • Variable fee: payment based on the volume of completed work
  • Hourly rate: charges based on the number of worked hours
  • Performance-based payment: compensation based on productivity
  • Retainer fee: an upfront fee to secure services from BPO companies
  • Outcome-based payment: compensation based on output
  • Milestone charges: service fees per preset project achievement
• Match the payment options with BPO goals. For instance, pick an hourly rate if you prioritize cost control. But if you want high-quality deliverables, select outcome-based payments.
• Evaluate a vendor’s pricing structure. As you develop your BPO client’s list, understand how service providers structure pricing. Confirm whether they involve hidden or variable costs that could impact your budget.
• Assess payment terms. Analyze the vendor’s payment terms, including billing frequency and due dates. Ensure these factors are compatible with your cash flows and financial setup.
• Negotiate payment terms and conditions. Work closely with the provider to weigh and match payment options with your business needs. Discuss service package fees, billing dates, or contract-related penalties.
• Consider contract duration when planning a BPO budget. Identify the contract length that fits your funding limitations and objectives. Long-term SLAs may offer cost savings, while shorter ones provide flexibility.
• Take note of exchange rates. Check currency exchange rates and associated fees if you outsource work to a provider in a different country, such as the Philippines. Include these factors in your BPO client’s list to guide your budget plans and payment options.
• Review escalation clauses as part of a service contract. This portion of the SLA outlines how fees may increase as the partnership progresses. Study the situations under which service charges may change and their potential impact on your budget allocations.
• Schedule legal and financial consultations. Seek legal and financial advice before finalizing and signing contracts. This way, your structured budget plans and selected payment options are legally sound and financially feasible.

5. List of Potential BPO Providers

BPO clients should research and list all potential providers to have various options available to meet specific operational needs. Note that each service vendor has varying strengths and capabilities.

Hence, this list helps you pick the right BPO partner that meets your business targets, requirements, and skillset preferences. It lets you compare providers based on these critical factors: 

• Industry experience and expertise 
• Market reputation and credibility 
• Track record and service quality
• Pricing and payment options 
• Workforce and technological resources 
• Client ratings and reviews 
• Awards and certifications

Furthermore, having multiple potential providers to choose from enables you to address BPO risks and drawbacks immediately. If one provider encounters problems or fails to meet your expectations, you have other vendors readily available to prevent downtime.

Before achieving such benefits, BPO clients should first create a list of vendors. This structured approach assists you in screening and identifying suitable prospects. Carry out these measures when making such a list.

• Conduct initial market research. Seek a provider using online business directories like Dun & Bradstreet and LinkedIn. Also, consider other sources for potential BPO partners, including forums, online reviews, client ratings, and peer referrals.
• Draft a preliminary list. Based on your research findings, develop an initial list of BPO companies offering services that satisfy your needs. Include relevant information, such as company names, contact details, and website domains.
• Conduct a background check. Review each provider’s experience and market reputation. Consider the above factors to ensure one meets your needs and qualifications.
• Check BPO service offerings and pricing models. Confirm whether the provider specializes in the specific tasks you intend to outsource, such as customer service. Also, the pricing models per service package must be assessed. Ensure these aspects suit your financial goals.
• Validate flexibility and scalability. Verify if your listed providers can scale their operations. They should be able to accommodate your changing needs, growing customer demands, and seasonal fluctuations.
• Evaluate technology and security measures. Examine what advanced solutions the potential BPO vendor uses to accomplish your needed services. Ensure these systems adhere to security protocols and are compatible with your enterprise platforms.
• Consider the provider’s location. Remember to assess where the provider operates. Knowing its geographic location helps you optimize your budget allocations and business schedules. Ensure the vendor’s location is convenient for both parties.
• Request proposals. Reach out to your short-listed providers for detailed quotes. Give them a clear description of your BPO requirements as a reference for payment calculations. Inform them about your budget limits, service scopes, performance expectations, and timelines.
• Perform a final evaluation of the short-listed BPO organizations. Rank providers based on the suitability of their expertise, timeline, and pricing for your project. Confirm the chosen provider’s alignment with your business goals.

After wrapping up and signing an SLA, maintain your comprehensive list of potential providers. Keep track of the vendors you evaluated but did not select. You can use this documentation for future outsourcing needs or as a reference.

6. Framework of Best BPO Management Practices

Seek advice and gather a list of best practices when managing your chosen BPO partner. According to recent research, a strategic plan such as this increases your profitability and market share. It also backs up your long-term aptitude and business competence.

This portion of your BPO client’s list fosters transparency between you and your provider. It details roles, responsibilities, and other relevant measures that your in-house and third-party teams must follow amid ongoing projects. Most importantly, this framework guides you in ensuring that the BPO provider consistently delivers high-quality outcomes.

However, you should take a structured approach when creating the best BPO management framework. To effectively handle your BPO relationship, record the outcomes of the following methods to improve your framework:

• Document a governance structure that outlines duties and reporting lines for both units. 
• Assign a contact person from in-house and third-party teams to oversee the BPO deal.
• Establish a timeline for regular meetings, reporting requirements, and project deadlines. 
• Identify communication channels for effective collaboration and coordination in real time.
• Execute timely evaluation processes for monitoring the BPO provider’s performance. 
• Define KPIs and reporting mechanisms to track the BPO team’s progress and output.

Ultimately, BPO clients should remember to list stringent data security measures that both parties must adhere to. Note that outsourcing involves information sharing through cloud-based systems. Thus, any data is susceptible to various cyber threats.

Based on IBM’s latest statistics, 82% of breaches included data stored in the cloud. The report urges organizations to seek solutions that provide visibility across hybrid environments. They should also safeguard data while transferring it across databases, clouds, and apps. 

Safeguard sensitive enterprise information with your BPO partner by implementing these approaches:

• Data encryption
• Password-protected cloud-based portals
• Biometrics and multi-factor authentication
• Endpoint security and anti-virus software deployment
• Regular system updates
• Patch management
• Firewall implementation
• Intrusion detection or prevention system optimization
• Secure data storage and backup
• Network segmentation
• Remote access control
• Incident response planning
• Security auditing and penetration testing

The Bottom Line

Developing a well-structured BPO client’s list is the first and most crucial step when kicking off your outsourcing journey. This plan outlines the key measures you must understand and execute to identify your BPO goals, requirements, and potential providers. It also outlines other strategic considerations, such as budget plans, workforce traits, and desired service levels. 

Once you meticulously create this list, you can effectively communicate your expectations with your BPO provider. It also establishes the foundation for a successful outsourcing partnership. Hence, expect increased efficiency, reduced operating costs, and improved output quality in the long run. 

Let’s connect if you need assistance creating your list and ensuring success with BPO. Unity Communications is an award-winning provider that employs skilled professionals and advanced technologies to meet your daily operational requirements.