BPM Outsourcing: Transforming Business Processes for Success

Most businesses find it challenging to access specialized knowledge and skills that can help transform their processes. One solution is to outsource certain business operations. Business process outsourcing (BPO) helps reduce overhead costs, improve productivity, and streamline operations.  

Within the realm of BPO is business process management (BPM) outsourcing, a critical subcategory allowing companies to enhance business performance and processes. Effective BPM outsourcing is a key component of organizational success.

Keep reading to learn about the benefits of BPM outsourcing. We also share tips for finding the right BPM outsourcing partner and examples of the strategy’s successful implementation.

Benefits of BPM Outsourcing

BPM is a discipline where companies assess all processes individually and as a whole to identify areas for improvement. Meanwhile, BPM outsourcing involves hiring an external vendor to handle high-value processes and expert work.

BPM is similar to knowledge process outsourcing (KPO) and BPO in many ways. So what is BPO? It is subcontracting certain business functions, such as customer service and human resources, to a third party.

The main difference between BPM and BPO is that the former oversees the entire business process, from recruitment and onboarding to training and retention. The BPM service provider teaches workers, motivates them, and, more importantly, manages the entire operation.

The demand for BPM will continue to grow. Reports from the Global News Wire show that the BPM market will reach $26.18 billion by 2028 at a 12% compound annual growth rate (CAGR) during the forecast period.

Companies that outsource business process management achieve greater organizational goals and move toward complete process transformation. Here are the major benefits of partnering with a BPM service provider:

• Reduced costs and increased bottom line. BPM outsourcing eliminates bottlenecks, resulting in reduced lead time for sales and a faster time to market. Ultimately, it leads to boosted sales and revenue. Moreover, BPM helps track and allocate resources to minimize waste and costs, all while increasing profit.
• Better organizational agility. Lower costs mean better agility. Companies that spend less are better positioned to respond to market changes and leverage opportunities. Businesses can also outsource call centers and other non-core business functions to bring in professionals without hiring them.
• More visibility and continuous improvement. BPM vendors perform real-time monitoring and track key performance indicators (KPIs), which leads to higher visibility. Improving visibility is key to better management. It also lets you identify areas for improvement and modify processes that no longer work while tracking the results.
• Guaranteed safety, security, and compliance. A reputable BPM vendor ensures your company complies with industry standards. They help you stay updated on new regulations. They can also improve safety and security by documenting each step of the procedure and facilitating compliance.
• Improved focus. Low-value tasks detract from leadership teams’ ability to focus on core competencies. Sixty-five percent of business leaders believe they can focus more on company growth if they can step back and look at the bigger picture. Instead of being bogged down by the back office, BPM outsourcing allows them to focus on running the business.

Example of Successful BPM Outsourcing Implementation

Centrica, an energy-saving and solutions company in the UK, was looking to increase its customer service capability after an unforeseen customer increase. It needed help delivering quality service. It partnered with a BPM provider that focused on the following areas to improve Centrica’s customer experience:

• Enhancing digital channels
• Developing a simulated digital training environment
• Improving the customer relationship management system’s operational model
• Minimizing recurring inquiries with feedback mechanisms

As a result, Centrica refined its customer experience and achieved the following key metrics:

• Higher first-call resolution rate
• More customers are using self-service to resolve their issues
• Lower wait times during peak periods
• a noticeable uptick in the net promoter score (NPS) and customer satisfaction

How to Choose and Manage the Right BPM Outsourcing Partner

The objective of BPM outsourcing is to achieve business success and transform processes. Selecting the right vendor should be the focus of your efforts. Maintaining a good relationship with the service provider is also ideal.

BPM and BPO challenges are likely to occur, but you can avoid them by choosing a reputable partner. Here is a guide to help you get started with outsourcing BPM.

• Determine needs. Identify what BPM is and why you need it. Determine the problem you want to solve and the value such a service will add. Knowing your requirements and clarifying your criteria for success and failure are good starting points.
• Advertise requirements. Once you know your needs, you must search for vendors that meet your qualifications. You can issue a request for proposal (RFP), which is a form that specifies what you are looking for. Alternatively, you can find prospective vendors online or through directories such as Yellow Pages.
• Short-list service providers. You should have received interest from potential vendors by now. You can short-list those that meet your needs and engage with providers more deeply.
• Conduct detailed evaluation and discussion. Both parties will share information at this point, so it is best to sign a non-disclosure agreement (NDA) that binds all parties to treat the shared information as confidential. At this step, the vendor makes a pitch, and you can discuss the scope of the service and potential pricing.
• Choose the best option. You will eventually identify the most suitable vendor and issue a letter of intent. However, consider keeping other short-listed vendors on speed dial should the partnership fail.
• Finalize terms and contract. Contractual terms that you and your partner discussed early on must be formalized. All parties must sign the formal agreement based on mutually acceptable terms and conditions.
• Deploy project plan. You and the provider will create and agree on an implementation plan outlining the steps you must take to arrive at a steady state. The plan also defines the timelines of projects and goals.
• Identify the team and provide support. Your chosen vendor will identify the staff to support the functions under this contract. The provider’s support and human resources teams will scout for talent. They will also arrange initial training.

The Bottom Line

BPM offers a structured approach when handling workflows, resulting in efficient rollouts, product deliveries, and tracking. With this discipline, companies can minimize costs and transform their operations. More importantly, they can guarantee compliant and consistent execution of procedures.

When done properly, BPM outsourcing helps clients work better. Hence, finding the right service provider and maintaining open communication are necessary.

Unity Communications employs industry experts and empowers them with continuous training for our BPM clients. Let’s connect to find out more.