A Good, Quick Look at Business Process Outsourcing (BPO)

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Written by Rene Mallari

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Over the years, more companies have turned to business processing outsourcing (BPO), aiming to improve efficiency, productivity, and growth. BPO is a well-known strategy in the business arena. For many business owners, what initially comes to mind when hearing this phrase is a call center where customers can ask questions or complain. But BPO is more than a hotline service. 

This article gives you a glimpse of the why, what, where, who, when, and how of BPO. This walkthrough is your guide to adopting outsourcing as part of your business strategy. 

Read on and check it out. 

 

What Is BPO?

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BPO is hiring a third-party service provider to do certain business functions or complete entire processes for a business. An organization can outsource front- and back-office services.

A call center is just one type of service a BPO company may offer. It is a voice-based service mainly using phones and is considered a front-office task. BPO also provides back-office operations such as data entry outsourcing

 

What Are the BPO Services to Look For?

Business process outsourcing offers many services for enterprises of all sizes, including:

  • Customer service: You can outsource customer support delivered over the phone or online to a BPO company. Establish the required processes for an effective customer service strategy and regularly collaborate with your BPO partner.
  • Human resources: This function covers hiring, training, and managing office and remote personnel. Maximize your outsourcing by asking the BPO company to provide you with a wide range of services, from recruitment and upskilling to payroll administration and attendance handling.
  • Accounting and bookkeeping: These are common areas that many businesses opt to outsource. A BPO company has accountants and bookkeepers to manage financial records efficiently. Ensure your BPO partner is highly knowledgeable about compliance standards and best practices.
  • Marketing: The third-party service provider can help promote products and services. It has marketing professionals who can generate creative ideas and valuable strategies for you. Hire a BPO firm with a wide array of marketing services, from content creation to social media posting.
 

Where To Look for a BPO Provider: Local or Overseas? 

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Business process outsourcing is available in different locales. Choose one that best suits your business needs.

  • Onshore outsourcing: Also called domestic outsourcing, onshoring is when a company transfers jobs to a geographically local service provider. The base of operations of the client and the BPO are in the same country. Similar time zones and cultural expectations are some of the benefits of onshoring.
  • Onsite outsourcing: Onsite outsourcing involves the service provider sending specialists to the client’s company. These specialists cover vacant roles for an agreed fixed period. The specialists becoming permanent is possible.
  • Offshore outsourcing: Offshoring entails outsourcing non-core processes to a BPO company in another country. Labor costs are lower, and the skilled workforce is abundant. These processes include outsourced bookkeeping, administrative functions, customer service, and IT customer support. Significant cost reduction is the biggest benefit of offshoring. 
  • Nearshore outsourcing: Nearshore outsourcing is relocating work to a country close to the client’s main office. Among the advantages of adopting this approach are stronger infrastructure and easier communication. 
  • Multisource outsourcing: Multisourcing consists of different location-based models. This approach combines the advantages of onshoring, nearshoring, offshoring, and onsite outsourcing. Risk mitigation is one benefit because this strategy spreads out the services.
 

Who Are the People to Look For in a BPO Company?

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Business process outsourcing companies employ individuals with different talents. They can fit any of your job requirements. Ask your BPO partner to provide you with staff having the following attributes: 

  • Flexible and responsive: The employees should be willing to be assigned to different local offices, work schedules, and tasks. They should also be able to respond and adapt to change, especially on how and when work gets done.
  • Technically skilled and knowledgeable: Personnel who are adept at technical matters can address customer issues accurately and fast. Individuals with extensive information technology experience are preferable. They comprehensively understand the technical aspect of your products or services.
  • Assertive and articulate: Everyone on the team—particularly in customer service, technical support, and marketing and sales—should be confident when engaging with customers. They should have good English communication skills to deliver high-quality service. They give a solid first impression to your company.
  • Enthusiastic and optimistic: BPO agents should have a go-getter attitude. They take the initiative and go the extra mile to provide a great customer experience. Enthusiastic employees can successfully sort out interpersonal differences and work productively with others. These people help boost morale and motivate coworkers to contribute more.
 

When Should You Look for a BPO Company?

Business process outsourcing companies will help you when the right time has come to delegate your tasks to outside experts. Here are some signs and situations that indicate you need to outsource soon:

  • When the overseas expansion is about to happen: Outsourcing is ideal when you establish a new branch in a foreign country. You will need customer service and technical support agents who can understand and speak consumers’ first language.
  • When communication channels are overwhelmed with customer requests: When your business struggles to address customer requirements despite having an omnichannel (texts, calls, email, web) presence, outsourcing customer service is a recommended solution. BPO companies have enough trained agents and specialists who can address the situation.
  • When the holidays are coming: Business activities spike during holidays such as the Fourth of July, Thanksgiving and Black Friday, and Christmas. Your eCommerce store’s high traffic volume will lead to more customers reaching out to you. Outsourcing companies can handle the processes and address questions and issues about products or services.
  • When the core business is the top priority: The business operations are complex and take a lot of your time and effort. As the owner or CEO, you should focus more on business growth and high-value ventures. Outsourcing is an effective way of assigning non-core functions and time-consuming tasks to external specialists.
 

Why Should You Look for a BPO Provider?

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Business process outsourcing can provide proven benefits, including:

  • Decreased operating costs: Outsourcing can turn fixed costs into variable costs and help you avoid high initial capital expenditures. Invest the money you save from outsourcing in critical business aspects such as marketing, product innovation, and other revenue-generating ventures. Such investments can attract more capital from financers, enabling your business to expand.
  • Enhanced efficiency: Doing everything yourself translates to bigger distribution, marketing, research, and development costs and a higher chance of inaccuracies, irregularities, and wastage. These unnecessary costs will affect product quality and customer service. BPO can help improve your efficiency, capitalizing on its expertise, deep knowledge, and latest technology.
  • Minimal recruitment expenses: Recruiting, hiring, onboarding, and training staff is costly and time-consuming. A BPO company takes care of all these processes. Provide it with details of your ideal BPO team, and you will have that team in a short time. You also don’t need to make the tough decision of laying off employees when times are hard.
 

How To Look for the Right BPO Company

Business process outsourcing firms abound, but finding the right one for you is easier said than done. Below are five outsourcing tips to help you find your best BPO partner:

  • Do detailed research. Check the prospects’ background and other important details. The potential partner should have an excellent track record, proving it did well with the organizations it worked with.
  • Find out the BPO provider’s technology. The service provider should use the latest customer relationship management platform and other advanced software. Monitoring its customer service team’s work with these tools makes them efficient. Its technology should also efficiently process a high volume of customer calls and requests.
  • Compare the BPO work culture with yours. The outsourcing company’s work culture and ethics should match those of your organization. Collaborating while having the same objectives and expectations makes processes effective. The BPO company should be both a backup and a major ally.
  • Verify transparency. Ask the potential partner about hidden service fees or other included costs, if any, from the get-go. Gather the details of its rates. Request that the BPO provider shows its security practices associated with outsourcing services. 
  • Ensure scalability. The BPO company should be capable of scaling its services up or down depending on your business needs. Scalability is an effective cost-management system. You pay the partner more service fees during brisk sales (higher revenue). But on slow periods (lower revenue), you pay less.
 

The Bottom Line 

Business process outsourcing is a proven way to help your business expand and reduce costs. It can also ensure that your customers receive high-quality service and support while you focus on your core functions.

The BPO industry is diverse, which allows you to choose the best type of outsourcing to align with your business requirements. This sector also teems with experts, specialists, and professionals who can help with your non-core activities. 

In any business undertaking, challenges are likely to surface. A better understanding and knowledge of outsourcing will prepare you to handle them.

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