Business Process Outsourcing (BPO) is a powerful tool that most organisations, regardless of size, growth stage or industry can leverage to more efficiently carry out their essential processes and tasks so that they can focus on innovation and delivering the best possible experience to their customers.
BPO is a process where companies can outsource services externally to a third-party vendor who can then carry out multiple business processes on their behalf. Some of the tasks that can be outsourced to a BPO company include logistics, customer service, invoicing, workflow management, and much more.
When choosing the right BPO company to work with it is critical to choose a partner that has the capability of leveraging the latest technologies, has a quality reputation of working with other businesses in your industry, and has the ability to build a BPO strategy that will help your business achieve your goals.
This complete guide will answer all questions regarding how to choose a BPO partner that can benefit your business.
Below are some of the key advantages of hiring a BPO company.
Outsourcing can help improve flexibility because companies use less money and the process takes less time. Overall, the company's potential to grow increases as a result of better flexibility and scalability. Scaling a company is not easy, and those in leadership positions need to make new hires to enhance the company's customer support and development.
Outsourcing allows companies to scale back or steadily build up their activities more quickly. BPO's flexibility is valuable for companies during their growth process. Companies looking to scale their business processes while exercising caution in hiring employees can rely on BPO, as it offers more flexibility.
Many business processes are manual and time consuming and as companies grow, performing these tasks at scale can quickly drive up expenses. Working with a BPO company can help better manage expenses and allow for greater efficiencies within these processes by outsourcing these critical tasks to skilled teams who can perform them faster and more efficiently. Since BPO companies are solely focused on performing these tasks as a service for other businesses, they are able to apply new processes and technologies to your organisation's business functions, such as the implementation of e invoicing solutions for instance . This helps you optimise, automate or transform those processes in order to deliver much greater efficiencies.
Outsourcing to BPO companies means that your company will have greater access to skilled people with the expertise required to take your business to new heights. You get access to trained individuals who know how to assist the company to meet its goals.
You can rely on the expertise of BPO companies to find qualified and skilled employees who can handle key functions of your company. As such, your organisation doesn’t have to allocate additional budget to recruiting, onboarding and training new employees.
BPO outsourcing is critical to fulfilling your non-core business operations to make them more streamlined. You can trust specialists from the BPO company to handle all your business' non-core functions to improve accuracy, boost productivity and save a lot of time.
Outsourcing to BPO companies provides your company with time to focus more attention on the core business functions. Improved efficiency allows businesses to have more freedom and focus their attention on making the company stand out in the industry. You don't have to keep worrying about recruitments or the performance of the payroll accountant.
Outsourcing can free more business hours for your company because you don't have to waste time on repetitive tasks. BPO companies allow your business to allocate their time to more important tasks and allows your employees to maximise their experience, skills and knowledge.
Outsourcing is a good technique to increase employee satisfaction and helps them feel valued by your organisation because they don't have to do repetitive tasks daily. An increase in employee satisfaction can greatly improve the workplace's efficiency, ultimately leading to business success.
BPO assists organisations in reducing overhead costs and thus allows them to redirect funds that would normally be earmarked for operating expenses into other areas of their business that help sustain or establish a competitive advantage. This means that other critical parts of your business such as marketing, product development or customer service, have more funds available and receive the investment they need to help your organisation move forward and thrive.
As with any major project, there can be some challenges associated with BPO. One critical first step towards minimising the risks of BPO is understanding the different BPO models that the BPO company you work with might utilise. By understanding the pros and cons of each BPO model, you can make a more informed decision and choose a partner that best suits your company based on its current needs. Below are the different types of BPO models.
Offshore outsourcing involves the delegation of your organisation's operations to an overseas team. It is considered as one of the most popular models because it provides businesses with various benefits like lower tax rates and labour costs, as well as advantages in currency exchange rates.
Offshore outsourcing is most often suited to back office functions that are highly repetitive such as basic Finance functions like reconciliations, HR administration, customer on-boarding, or forms and claims processing. However, some offshore locations such as the Philippines offer a higher degree of English proficiency which can further extend your organisation’s ability to outsource more complex, customer facing functions such as IT support, customer service or sales outreach.
Offshore outsourcing works best with companies looking to maintain balance between the service outcomes desired and cost saving.
Onshore outsourcing is the primary model for organisations that choose to contract a service to a third party that performs the function for them in their local domestic market.
A BPO companies can be contracted to provide services in another state, city or province in the country from which your business operates. The benefits of onshore outsourcing include the opportunity for increased oversight, access to specialist skills that may not be available from off-shore service providers, and reduced language or cultural barriers. For certain processes, organisations may be required to utilise onshore outsourcing due to compliance requirements.
Making a choice between offshore and onshore outsourcing involves evaluating the proximity, regulation compliance and knowledge of the local team. One key disadvantage of onshore outsourcing vs. offshore outsourcing is that there are no currency advantages to be gained, which means that your business will not stand to save as much on labour costs.
Nearshore outsourcing is a process where the company outsources specific operations to nations that have a common border. This type of outsourcing is best for businesses that are looking to work with skilled teams that speak the same language and are in the same time zone.
Nearshore outsourcing is beneficial to your business in terms of getting a skilled and qualified team at affordable rates. A key benefit of this type of outsourcing is that it promotes collaboration with your in-house employees because the outsourced team speaks the same language and are in the same time zone.
Another benefit of nearshore outsourcing is that it promotes cultural compatibility because there is a high probability that you share a lot with people from neighbouring countries. Having a common culture can help in strengthening relationships and creating bonds.
One potential disadvantage of nearshore outsourcing is that, similar to onshore outsourcing, there are typically fewer currency exchange advantages that that your company can take advantage of with this model. This means that the cost savings on the price of labour will not be as significant as an offshore model. Nearshore outsourcing also offers fewer destination choices because it limits your business’s pool of options to partners who speak the same language and/or share the same time zone.
BPO is primarily divided into front-office and back-office. Front-office involves services that are linked to the process of contracting clients through technical support and marketing. Back-office entails the internal business operations like purchasing and billing.
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It is essential to work with a BPO company that is experienced enough to promote a successful collaboration between the BPO team and your in-house team. Canon Business Services ANZ has purpose-built solutions, and we can collaborate with you to establish an outsourcing process that suits your business needs to promote the growth of your business. Our team of experts will provide support throughout the entire outsourcing process. Speak with an expert today to learn more about our business process outsourcing solutions.