What if your business isn’t ready for the challenges of tomorrow?
Do you hire more staff to manage your customer service? Do you set up a separate accounting department? Or is it better to outsource those functions?
Business process outsourcing (BPO) has been a significant game-changer for businesses and the economy worldwide. Unfortunately, many companies that would benefit from BPO don’t understand what it is and what BPO providers can do for them.
You want to run your business efficiently and with appropriate costs without compromising the customer experience. When you learn the outsourcing basics, you’ll realize that business process outsourcing is the best way to reach this goal.
Are you curious about the details and having an in depth explanation of this BPO topic and want to learn more about this process and its providers? Keep reading to go in-depth to all the answers!
What Is Business Process Outsourcing?
Business process outsourcing (BPO) is contracting an entire business function, such as inbound sales, marketing, accounting, etc., to a third party.
Historically, businesses have outsourced roles such as accounting, customer support, data recording, digital marketing, payroll, etc.
BPO differs from the general concept of outsourcing in that instead of outsourcing a single job, such as order processing, you outsource the entire business function (all the inbound marketing, for example).
“Outsourcing” means finding a high-quality provider who can care for that business function for you.When you choose the right provider, your outsourced customer service or back-office operations will be professional and seamless.
Many small businesses enjoy BPO because outsourcing these processes helps them complete more jobs for more clients than they could otherwise complete on their own.
However, even larger enterprises have discovered that BPO is a powerful tool to boost efficiency and expand their brand.
What Is a BPO Provider?
Now that you know more about BPO, the definition of a BPO provider is simple enough.
This term simply refers to any person or organization you outsource one or more of your business processes to. This guide will explore some of the different BPO provider categories you must understand to get the most out of your outsourcing.
Types of BPO Providers
At a glance, the best business process outsourcing providers generally specialize in either front-of-office or back-of-office services.
What is a Front Office BPO Service Provider?
The front-of-office services refer to any services requiring customer contact. Whether it’s customer support, tech support, or anything in between, these providers help interface directly with your client.
Front Office Outsourcing Services include services that allow interaction with the company’s customers; some of them would be marketing, appointment scheduling, and tech support.
Several businesses can take advantage of having a solid front office support, a customer service insurance BPO process can enormously level up the game of an insurance company in nurturing existing clients, handling complaints and overall improving customer satisfaction, for example.
What is a Back Office BPO Service Provider?
By contrast, back-of-office services refer to any internal services for your business. This may include simple processes such as billing and purchasing, or even complex processes involving legal documents and account services.
Back office services also include internal business processes, such as data management. Back-office tasks are essential to core business processes.
BPO Provider Categories
There are different BPO providers, and it can be difficult to group them together. Because of this, many businesses group these providers up based on their location.
Three Different Types of Outsourcing Based on Location:
What is an Offshore BPO Provider?
Outsourcing to a distant country. (India, China, etc.)
For example, offshore BPO vendors are those who live far outside your own country. For a North American business, an offshore vendor might live in Europe or the Philippines.
What is a Nearshore BPO Provider?
Outsourcing to a neighboring country. For example, from the US to Mexico.
You might also work with nearshore vendors. In this case, “nearshore” refers to vendors in neighboring countries. For businesses in the United States, nearshore vendors might be located in Canada and Mexico.
What is an Onshore BPO Provider?
Outsourcing within the same country but to a different city or state.
Finally, some onshore vendors are located within your country. While they may not be in your city or state, they are far closer than other BPO vendors.
Let’s dive into what BPO providers are and the different services they can offer your business.
Other Types of Business Process Outsourcing Providers
Business process outsourcing is sometimes categorized by the types of services that are being provided.
The three prevalent BPO categories are:
Knowledge Process Outsourcing (KPO)
KPO Is when the outsource service provider is hired not only for its ability to perform a particular business process but also to provide expertise around it, adding value to the services.
The processes outsourced to KPOs are knowledge-based and specialized compared to BPOs.
Legal Process Outsourcing (LPO)
LPO is a type of KPO specific to legal services, from drafting legal documents to performing legal research.
Research Process Outsourcing (RPO)
RPO is another type of KPO that refers to research and analysis functions. Investment firms, start-ups, and marketing agencies are among the organizations that would hire for RPO services.
4 Benefits and Advantages of BPO
Now you know more about BPO and BPO providers. But you may still be unsure whether your business needs BPO. There are a lot of advantages to outsourcing your business process services. These include costs savings, improved efficiency, expansion possibilities and a focus on quality.
To help you answer the question, let’s take a closer look at the different perks of BPO. Some of those benefits include:
The Primary Benefit is Saving Money
While something else keeps your business from doing everything in-house, trying to complete all the processes on your own will involve plenty of recruiting, staffing, and training.
In many cases, simply outsourcing specific tasks to the right vendors is far cheaper than hiring new staff and paying for their full salary. The costs of labor aren’t going down, and the more you have to do yourself, the more you have to pay.
It’s not just salary for the skilled workers, either — you have benefits, health insurance, and more. You may also need to hire and pay managers to run the department. By outsourcing, you can save that cash.
BPO companies can execute business processes at lower costs without sacrificing quality. There’s also a tax advantage to outsourcing.
BPO Allows Business to Focus on Quality
In addition to saving money, BPO helps your business and its employees do what they do best.
Instead of making your key employees take on various roles and responsibilities, you can take care of various processes via outsourcing. This leaves your best workers free to focus on the overall quality of their primary responsibilities, giving your team time to focus on what’s essential for the company – the core offers that make it stand out.
You know that companies that focus on one main thing do better than distracted competitors. If you want your business to succeed, it’s important to focus your resources on your core competencies.
By outsourcing specific processes to a BPO provider, you can focus your time and money on what you do best.
Gain Speed, Flexibility, and Experience With a BPO Provider
BPO can also make your company much more flexible. Reacting to new challenges with only your in-house team means you may lose valuable days and even weeks to researching an issue and training your team.
With outsourcing, you can have experts handle these unexpected challenges coordinated and efficiently.
BPO service providers are professionals at what they do, and they can provide business process services with high accuracy and efficiency, saving business owners time.
BPO providers have been focused on specific processes for years. They’ve learned the best practices, how to avoid common pitfalls, and how to train staff effectively. When you work with them, you eliminate your learning curve. Access high-quality, efficient, experienced work from day one by outsourcing.
Finally, by allowing corporations more flexibility, BPO service providers speed up business operations to adjust how the outsourced business process is executed so that you can better react to changing market dynamics.
BPO Provider Allow Business to Grow and Expand
Furthermore, BPO provides incredible business solutions for any company seeking to expand its brand.
For example, hiring the right offshore or nearshore BPO services provider can help you bridge language gaps, localize your marketing, and ultimately help you penetrate new markets and discover new customers.
If your business is growing quickly, that’s great! However, it can strain your company if you have to grow specific departments to meet the need.
For example, technical support or customer service can quickly become overwhelmed, and it’s hard to hire and train people quickly enough to keep up.
With a BPO provider, you can simply expand your usage of their service according to your needs. It allows you to scale efficiently and seamlessly!
BPO is a Huge Help to Small Businesses
Smaller companies don’t always have the resources and personnel their larger counterparts do. That means that doing everything in-house doesn’t make sense.
No one needs two or three different jobs. BPO providers can lift the weight off your shoulders and let you focus on running your business.
The Drawbacks of BPO
There are plenty of great benefits of using BPO providers. But this may have you asking: Are there any potential drawbacks to BPO services?
Like anything else, there are advantages and disadvantages to business process outsourcing. Mastering the outsourcing basics means knowing the benefits of outsourcing, but also the drawbacks.
You should be aware of a few of them, but most stem from carelessness on the part of the original business.
Potential Security Risks and Outbreaks
For example, hiring a shady BPO provider may expose your business to potential security and communication risks. But you can sidestep this issue by carefully vetting any providers you contract with.
Also, if you outsource your financial or data processes, you want to ensure you’re working with a BPO provider that provides top-notch security for your data.
BPO Costs May Unexpectedly Rise
Some outsourcing companies also underestimate the cost of outsourcing various services. While this process will save you money, the initial and ongoing fees may be higher than expected.
Language Barriers
In some instances, businesses may encounter language barriers when outsourcing to providers in other countries. However, the right BPO companies can help you bridge the gap and engage in productive communications.
There is no Direct Control on Employees
One is that you don’t have as much direct control over the process. You don’t hire the employees; taking action on a problem may take a day or two. That can bother some business owners and managers.
Do not Become Reliant
Finally, there is always a risk that your business will become overly dependent on a business process outsourcing company.
This is why it is so important for you to determine what your internal staff can and cannot handle before outsourcing any responsibilities.
Take BPO Provider Selection Seriously
As a bonus, being selective at the very beginning can help you save money in the long term for outsourcing.
If you don’t choose the right BPO provider, you might end up with low-quality work. Ensure that the company you outsource to is committed to high quality and consistency in the processes they’re taking care of.
Many of the disadvantages of outsourcing can be taken care of by choosing the right high-quality provider. You can also decide to outsource only specific processes you don’t need direct control over and keep the others in-house.
How to Pick the Right Business Process Outsourcing Partner
Picking the right BPO provider is crucial to the success of your business. You want to choose a provider with financial stability, cultural compatibility, a secure infrastructure, and a solid record of providing services in your industry.
Confie BPO has helped businesses reduce costs and improve efficiency for over 20 years. We are a nearshore operation located in Tijuana with bilingual and multicultural employees.
Which Types of Companies Need BPO?
Companies choose to outsource when they decide that another more specialized company can handle a business process better than they can in-house, or they want to outsource those processes to save money.
Any company that caters to offers specialized services needs a call center or is a manufacturer or distributor can benefit from BPO services.
Although BPO originally applied solely to manufacturing companies, BPO now refers to outsourcing services.
Examples of the Most Common BPO Services
Customer service
As we mentioned above, customer service outsourcing services are popular process to outsource. It isn’t easy to effectively staff a customer service department, hire managers, and maintain a high level of service.
You also need to buy software and keep it up to date while providing top-notch training. Outsourcing this process can save you a lot of headaches.
If done correctly, a client will never know they aren’t speaking to one of your customer representatives.
The provider will answer customer questions and solve problems through well-trained staff using the latest technology. As you grow, your whole operation can scale effortlessly.
Ultimately, you won’t have to worry about finding customer service representatives, managing them, and supplying training and technical support. Instead, your business process outsourcing provider will take care of it for you.
Back Office Processing Support
Who doesn’t love paperwork? Everyone hates it! Why waste your time and staff hours managing back-office processes when you can outsource them?
Free up office space and salary dollars by letting a BPO provider manage your back office support services. Take care of your back-office concerns, so your staff can focus on what you do best.
Technical Support Call Center
It’s important to provide excellent products to your customers, but sometimes they have questions about how to use them — or the device is malfunctioning, that’s when a technical support call center comes into play.
Maintaining technical support staff for your customers has many of the same challenges as running your own customer service department.
Having technical support outsourced allows you to provide high-level customer support without doing so in-house.
Accounting
Accounting outsourcing is an easy way to ensure your financial records stay up-to-date and accurate without hiring expert accountants yourself.
You’ll save money and time while gaining the peace of mind that your accounting record and collections are being handled professionally. Outsourcing to a skilled provider saves office space, time, and wages.
Lead Generation
You can also outsource call center lead generation. The right BPO provider will help you find good leads, build your marketing list, improve brand awareness, and more.
Whether you want to do outreach through telemarketing, surveys, online advertising, or other methods, a BPO provider can deliver qualified, high-quality leads to your sales representatives.
These examples are just the tip of the iceberg. You can outsource a wide variety of business processes!
Other Popular BPO Services:
- Sales
- Payroll
- Insurance BPO Services Company
- Accounting and Collections Call Center
- Customer retention
- Inbound marketing
- Call Center Services
- Social media marketing
- Call Center Payment Processing Services
- Human resources
- So much more!
What is Going to Be Your Next Big Move
Now you know about BPO, including the advantages and disadvantages of the outsourcing process. But do you know where to find more answers to benefit your business?
Confie BPO has over 1,000 highly trained staff members, nearly all bilingual. Our state-of-the-art facility with current infrastructure allows us to operate 24 hours a day, 365 days a year, with maximum efficiency.
We continually improve our processes by adopting the most recent technologies and practices. Confie BPO has experience working with small and large businesses in multiple industries. We can help your company reduce costs and improve efficiency. Call us today at 800-684-2276 to learn more about our BPO expertise.
