July 31, 2021
July 31, 2021
Small businesses and large corporations alike could use a little help from time to time. This is why business process outsourcing (BPO) has grown to become a multi-billion dollar industry. Even amid the pandemic in 2020, the global BPO market was valued at $232.32 billion and experts predict that this growth will continue in the foreseeable future.
With BPO, companies can delegate their back-end and front-end processes to free up time for their employees. In turn, this allows employees to focus more on improving products and services as well as optimizing operational efficiency.
However, while outsourcing offers a slew of benefits, it is no silver bullet. It does not magically get rid of your workload and boost your bottom line. If you want to get the most out of your BPO partnership, it is important to have a clear understanding of what business process outsourcing is, how outsourcing works, and how you can build a successful outsourcing strategy.
So, in this article, we will talk about some ways that can help you with your outsourcing initiatives from tips on finding an outsourcing partner to managing your partnership.
Knowing what you want is critical to any business endeavor and outsourcing is no exception. Before starting your search for business process outsourcing companies, you must first define what you want to achieve from the partnership.
Having clear objectives will allow you to outline the responsibilities that you are looking to share with your BPO provider as well as what you expect from them. In turn, these objectives help your BPO partner to set the proper targets and come up with strategies to meet them.
To give you an idea, here are a few of the many objectives that businesses use when outsourcing:
70% of companies cite cost reduction as their primary objective for outsourcing, as reported by Deloitte in their 2020 Global Outsourcing Survey. Contrary to popular belief, however, these cost savings do not come from tax breaks. In fact, according to PolitiFact, while companies can reap tax breaks when they relocate to another state or country, the U.S. tax code does not have specific tax breaks related to outsourcing.
Outsourcing can save you money by optimizing processes without having to invest in new infrastructure and personnel. It also gives you access to professionals with extensive knowledge of processes your internal team may not be familiar with. This translates to spending less on recruiting and training employees. To top it all off, outsourcing processes to experts who know them best lets you ensure efficiency and quality at all times.
Managing a business as it expands can sometimes feel like fighting a hydra — every time you overcome one hurdle, two will take its place. While it can be exciting to see your company grow, constantly playing catch-up with new business requirements or consumer demands can take a toll on you and your employees.
Outsourcing allows you to delegate some of these tasks so can focus on your core competencies. This gives your employees the time, energy, and headspace to think about improving critical processes or even come up with new products and services for your clients.
Almost every business has a peak season and in the busiest times of the year, there’s a good chance that the amount of work to be done might be too much for your employees to handle. Hiring additional staff members will allow you to offset some of the load but the recruitment and training can get costly. On the other hand, if you chose not to hire new employees, you might run the risk of jeopardizing production or customer service.
Partnering with a BPO provider makes staffing scalable. It allows you to have access to experienced workers to help your staff whenever the need arises. This way, you can meet your customers’ needs and ensure the efficiency of operations without the long-term commitment of hiring new employees.
Just because a company can develop great products and offer stellar services doesn’t always mean that it can provide equally impressive customer care. After all, managing the customer experience — from handling their inquiries and guiding them through their transaction to providing them with post-purchase support — can be a handful.
Finding a BPO partner that can provide customer support, tech support, and similar functions allows you to ensure that your customers always have a pleasant transaction with your company. This lets you drive more sales and improve customer loyalty.
BPO companies are more than just service providers — they serve as an extension of your organization. These companies will not only be privy to some of your company’s confidential data but also have a hand in helping you run your business. So, you must choose your partner wisely.
It can be tempting to simply opt for the top BPO firms but there’s more to that when it comes to choosing one. Here are some factors you might want to consider when looking for a BPO outsourcing partner:
Choose a provider with a specialization. For instance, if you need the BPO company to help you with customer service, they should have a roster of support specialists with experience relevant to what you offer as well as have the right equipment to provide multi-channel support. This is a good indication that they are capable of performing tasks according to industry standards with efficiency and consistency.
As your business grows, so do the processes that you’ll need help with. So, you need to partner with a BPO company that can perform a variety of business processes. This will be helpful as you scale your organization. For example, if you intend to outsource your customer support processes, you might want to see if the same provider can offer multilingual support options. This keeps you from having to switch companies in case you start taking on customers from other countries.
Your BPO partner should be able to curate a team specific to your business objectives as well as facilitate their training. It is also best if they can assure you that the team assigned to you is dedicated to your project and not being passed on from client to client.
Remember that your BPO partner will be representing your company, especially if you are outsourcing front-end processes. They should closely collaborate with you so that you can move as one team and provide seamless customer experiences.
Processes and partnerships change from time to time. Whether you are undergoing business restructuring, looking to switch providers, or simply renegotiating your rates, your BPO provider should have a transition protocol in place. This way, you can minimize any disruptions the change may have on your operations.
As the old saying goes, numbers don’t lie. So, quantifying your outsourcing initiatives is important if you want to find out if your BPO outsourcing partnership is headed in the right direction. Plus, as research shows, companies with CEOs that rely on data-driven decisions are 77% more likely to meet their business goals.
One of the ways you can implement a more data-driven approach to outsourcing is by establishing key performance indicators (KPIs). These metrics will allow you to measure the performance of your outsourcing partner and gauge whether they are meeting your business goals.
An important consideration here, however, is that there are different types of KPIs. Meaning, you will need to determine which KPIs will accurately target what you want to measure. Some examples of KPIs that you might want to look into include:
Working with a BPO provider does not come without certain risks. After all, you will be entrusting aspects of your business to a third-party provider. However, this doesn’t have to be a deal-breaker.
Taking the time to understand the risks associated with outsourcing will help you prepare for them. This way, should you come face to face with these problems, you will know how to mitigate them and ensure minimal impact on your overall operations.
Some of the most common but preventable outsourcing risks are the following:
Finding a good BPO provider is only the first step to a successful outsourcing effort. To truly reap the benefits that this business strategy has to offer, you’ll need to be hands-on in managing and nurturing your partnership.
A positive relationship with your BPO partner can only lead to good things for your company. For instance, it can boost the morale of outsourced employees resulting in better turnaround times or highly customized service. In some cases, it might even help you get more flexible payment terms or even discounts on services.
To get you started, here are some steps that you can take to foster rapport with your business process outsourcer:
A report by Grant Thronton revealed that 88% of companies say communication is critical to the success of outsourcing initiatives. This means interacting with your BPO provider should go beyond weekly progress reports and meetings on new processes.
One way to do this is to regularly touch base with your BPO manager. Discuss your requirements with them in detail, making sure to mention your preferences as well as the pain points you want them to address. You may also ask them what approach they think is best in helping you achieve your business objectives so you know exactly what they will do with your processes.
In addition to this, you may also want to consider training them the same way you would if you were onboarding a new employee. This way, your BPO provider can have a better understanding of how you operate and provide you with outputs that are tightly aligned with your goals.
Working in different time zones, dealing with language barriers, and having stark cultural differences can make outsourcing partnerships prone to miscommunication. To alleviate this, sharing your corporate culture might help.
Finding similarities in your work methodologies and company values can help you see each other’s perspectives. This way, you can better anticipate each other’s concerns in terms of processes as well as come up with ways to optimize workflows together.
Feedback is necessary for growth. This may take the form of pointing out rooms for improvement or commending your outsourced team for a job well done. Either way, letting your BPO partner know how they are doing helps build a strong partnership.
For starters, detailed comments about BPO performance can help your partner know whether they are on the right track and adjust their strategies accordingly to serve you better. It also allows them to zero in on what parts of their output matter the most to you.
Outsourcing is a great way to keep your company at the top of its game, especially in an age when technology and industry trends are changing at breakneck speed. However, it is important to note that outsourcing is a two-way street.
Your affinity with your BPO provider can make or break your operations or even your company’s authority. As such, you should not only choose a BPO company you can trust but also take the necessary steps to nurture your partnership.
To ensure a fuss-free outsourcing experience, be sure to keep an open line of communication with your provider and closely monitor their performance. It may also help to prepare for problems you and your BPO partner might encounter along the way. By doing so, you can continue to grow your company while improving your processes and take your business to the next level.
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