Business process outsourcing (BPO) is subcontracting various business operations to third-party vendors. Many businesses, small and large, choose to outsource two main areas: back office operations and front office operations.
Back office operations can include functions such as: IT services, accounting, payment processing, and quality assurance.
Front office operations can include functions such as: technical support, sales and business development, and marketing.
Business Process Outsourcing has become an integral part of many industries– how do you know if choosing a BPO partner is right for your business? In this post, we will explore four benefits of outsourcing parts of your business.
Focus on Your Core Competencies
Outsourcing non-core business functions will allow your business to stay focused on the important, core tasks and processes. It is more efficient to spend your time focusing on doing what your business is good at. If you are in the software industry, you should spend the majority of your time creating and improving your product.
The tasks that are essential, but not necessarily your core product or talent, can be outsourced. For example, your software product will need some form of customer service. Instead of spending time, money, and resources hiring an internal team to handle customer service calls, you can outsource this function to a BPO company. This will allow your business to focus on its bottom line, increase efficiency and lower your costs.
Reduce Labor Costs, Overhead Costs & Retain Flexibility
It is no secret that hiring, training, and retaining employees is costly. Outsourcing will convert these labor costs into variable costs. This means you will only pay for the services you use and provide you flexibility in staffing changes. For example, you may find that a certain time of year is busier than normal. By outsourcing, your business would have the ability to ramp up staff without the financial commitment of hiring in-house employees. Once you have made it through your busy season, you can easily scale back down.
Accelerate Business Growth
Many businesses find that they would benefit from having more staff on hand, but may not be able to afford the cost of hiring and training more in-house employees. This is especially true in cases where businesses are experiencing growth. The most affordable option is to hire an outsourcing firm to support your business during your growth. As mentioned before, outsourcing allows you the flexibility to scale up and down as needed. It is a great way for your business to maintain steady growth while keeping your focus on your core processes.
Access to New Resources and Top Talent
Outsourcers have specialist knowledge, expertise, and experience you may not be able to afford to hire in-house. Outsourcers are continuously learning and adapting to new industry trends, new techniques, and new technologies. With the availability of skilled experts from a BPO firm, businesses can save on recruiting, training and certifications. They can also enjoy the services of business process consultants and industry specialists at lower costs.
Is Outsourcing Right for Business?
Outsourcing may or may not be right for your business. In order to determine if you should outsource, consider the following:
- Would you like to reduce your operational and labor costs?
- Are your employees overloaded?
- Do you need to free up internal resources?
- Would your business benefit from expanding your talent pool?
- Is your operational budget too tight for comfort?
If you answered yes to any of these questions, outsourcing is an option that could improve your business’s success.
The main motive behind business process outsourcing is to allow your business to invest more time, money, and resources in core activities without losing quality. Cost advantage followed by increased ability to focus on core competencies is the major driving factor.