Back Office Outsourcing Services Explained for Beginners

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Written by Allie Delos Santos

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Do you want to outsource your back-office functions? Back office outsourcing services assist firms like yours in managing labor-intensive administrative tasks. Back office outsourcing is a cost-effective alternative that streamlines operations, increases flexibility, and reduces operational costs.

This article gives you a rundown of back-office outsourcing services and their benefits. Finally, we’ll discuss administrative tasks you can consider outsourcing.

What Are Back Office Outsourcing Services?

Back Office Outsourcing Services concept

Back office process outsourcing involves assigning low-hanging transactional tasks to an external vendor. It allows firms to focus on their core business by automating lower-value procedures. Also, it saves companies money and time by freeing up internal resources.

Companies of all sizes and in all different sectors are using back-office outsourcing services. Cost savings is the primary reason. Modern business leaders want to free themselves of unnecessary workloads. Thus, outsourcing back-office operations has become more popular.

However, you must know several things about back-office outsourcing services before committing to it, including the following: 

  • Check the outsourcing company’s security protocols for keeping sensitive information private. 
  • Assess how the service provider accomplishes the tasks delegated to them.

Back office outsourcing services boost firms’ profitability and productivity. While not directly related to the main operation, back-office tasks are vital to operations and have a substantial impact on the total business.

What Do Back Office Outsourcing Services Do?

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Back office services are your organization’s functions that are not customer-facing. Employees for these roles are responsible for those activities that offer required assistance to front-office departments and enhance customer experience. They manage administrative tasks to keep operations running and make sure resources are available for sales and client-facing staff.

Back office outsourcing services can include but are not limited to the following.

IT Support

Customer satisfaction and retention are directly affected by post-sale technical support. Customers might call about warranty concerns or seek technical support for minor or major issues. It’s critical that courteous IT support with good customer service and technical knowledge handle the issue.

Outsourcing back-office services guarantee customer satisfaction and release your internal employees from the burden of managing multiple customers calls a day. This results in improved employee morale, better customer service, and an increased bottom line.

Finance

For the majority of companies, financial functions are simultaneously critical and mundane. As necessary as it may be, finance takes a significant amount of time from your internal employees. It needs high-level accuracy and proficiency as well as maximum compliance with regulatory standards.

Businesses across the globe have seen the significance of back-office outsourcing companies, especially for finance and accounting functions. Back office outsourcing services with state-of-the-art finance infrastructure and seasoned accountants dominate the industry.

Although this function incurs hefty costs due to the required infrastructure and software arsenal, reputable back office outsourcing services have the necessary resources to manage business finances on your behalf. The typical accounting and finance tasks that third-party providers work on include:

    • VAT returns
    • Cash flow statements
    • Balance sheets
    • Ledger maintenance
    • Tax reports
    • Bank account reconciliations
    • Year-end account adjustments
    • Credit card reconciliation
    • Accounts payable reports
    • Income statements
    • Sales report generation

Human Resource

Outsourced HR enables your company to realize a higher employee satisfaction rate and more streamlined workflows. 

Throughout the years, back office outsourcing services have helped companies establish better human resource strategies, including hiring, screening, compensation, auditing, leave management, performance management, and retention. It allowed companies to cut back on expenses while enjoying improving interdepartmental coordination.

Data Entry

Data entry is another critical yet tedious process. However, it’s not a good idea to keep data entry inside the company. We highly suggest that you outsource data entry services.

Delegating data entry to reliable back office outsourcing services that have robust computer arsenals and security protocols, as well as a team of seasoned professionals, means you get to leverage their resources while you focus on your core operations.

Payroll

Delegating payroll to back-office outsourcing services helps companies of all sizes to save on limited resources and time. People used to believe that only large enterprises could reap the benefits of outsourced payroll. But recently, even small to mid-sized enterprises are following in their footsteps.

Payroll is one of those functions under strict regulations and requires maximum compliance. Since it can sometimes be difficult to keep up with the law, outsourcing payroll ensures that your company is always on top of these standards. External payroll providers stay on top of accounting standards on your behalf, taking away significant weight from your company.

Other important back-office services that third-party service providers manage include:

  • Order management
  • Data extraction and cleansing
  • Invoice forms
  • Document imaging
  • Admin support 

Why Do Companies Choose Back Office Outsourcing Services?

Why Do Companies Choose Back Office Outsourcing Services- concept, software, technology, outsource, services, support

Scouting for quality back-office staff is getting more challenging because of ongoing labor shortages. Companies need to match the asking compensation of their employees and offer additional benefits to keep their existing teams and gain new ones.

For many organizations, back office outsourcing services are a reliable and cost-effective solution to address the challenges in securing quality admin support staff amid the growing complexity of accessing talent pools.

Since many back-office functions can be accomplished digitally, it makes sense to outsource them to offshore countries like the Philippines, where labor costs are significantly cheaper. 

The Philippines is one of the top countries companies opt for when it comes to back-office process outsourcing. So long as your company is offshore-ready, outsourcing to another country is easy and straightforward.

Back office outsourcing services have been a robust solution for companies wanting to increase their bottom line and efficiency. Plenty of benefits accompany back-office outsourcing when done correctly. Here are some of the benefits. 

1. Scalability

Reliable back office outsourcing services will allow your business to expand in terms of the bottom line, size, and productivity. The growth of your organization is directly related to the performance of the outsourcing company. In other cases, your third-party provider will also manage the recruitment and training process, giving you better support.

2. Access to the Newest Technologies

Another important benefit of back-office outsourcing services is that businesses get access to the newest technological resources, top-of-the-line services, and skilled professionals. Third-party outsourcing providers emphasize delivering support with the most recent technologies and providing continuous training to their employees.

3. Differences in Time Zones

Businesses with customers around the globe would need to outsource administrative and customer service to provide assistance to their clients. International outsourcing providers come to the rescue when you set your foot in a foreign market.

4. Lower Overhead Expense

Back office outsourcing services are more cost-effective solutions than keeping administrative functions in-house. The outsourced vendor takes care of the hiring, training, and maintenance of equipment, reducing the money you need to shell out.

The Bottom Line

When organizations start to expand their footstep in the market, back office outsourcing services are a great strategy regardless of your business’s size. Whether you run a multinational enterprise or a startup, back-office functions will always be tedious and cumbersome. For this reason, outsourcing has become paramount.

Before proceeding to outsource any function, first establish the tasks that need to be accomplished and the metrics for measuring success. You can then work with your service provider to create a roadmap for achieving your business goals.

If you haven’t given back office outsourcing service a thought, now is the time to do so. Visit our website unity-connect.com to find out more.

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