Business is changing at a phenomenal pace. To keep up with this change and continue offering their customers the quality they have come to expect, many companies have turned to BPO services. But what exactly is business process outsourcing (BPO), and how is it changing how new and established businesses operate?
What Is Business Process Outsourcing and BPO Services?
Business process outsourcing is a system where third-party providers are contracted to take over or assist with business functions for a company. With BPO services, the third party is fully responsible for all processes connected to the business’s function.
Some refer to BPO services as externalization or subcontracting. This is because, at first, it was initially applied only to manufacturing entities, and these entities outsource a big part of their supply chains. Now, BPO can be applied to services as well.
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What Business Process Outsourcing Offers Businesses
BPO services can help bridge the gap between a company’s goal and what the customers expect. For example, a firm that produces video games may not provide in-house customer service, and they will outsource that aspect of their business to a BPO. The BPO would serve as the call center for the company.
In this scenario, the BPO speaks and acts as if it were the customer that hires them. They are responsible for delivering the best in service quality while building a solid connection between the brand that hired them and their customers.
BPOs offer businesses the ability to create a new operating model. It is anchored around customer service and strengthened by using state-of-the-art technology, like artificial intelligence, to deliver exceptional experiences and outcomes for the business and its customers.
Factors to Consider When Deciding on Using BPO Services
There are several factors to consider when deciding what business process outsourcing modality is suitable for you. BPO companies come in different forms and are often divided by where they are located.
Onshore outsourcing is where a business works with a company in the same country. Nearshore involves working with an outsourcing company in a neighboring country, such as the United States and Canada. Offshore outsourcing is when an organization engages a provider’s services on the other side of the globe.
Several pros move businesses to decide to outsource services. The first is lower cost. Instead of buying equipment and hiring more employees for different tasks, a company can outsource the job to a service provider. This reduces or, in some cases, eliminates overhead costs.
Outsourcing provides higher efficiency. Outsourcing companies have experienced in a particular field, and this means that their singular focus allows them to perform at an extremely high level. They use the latest technology and adopt best practices, leading to greater productivity and higher efficiency.
Using BPO services allows companies, especially startups, to focus on their core business functions. Ancillary business activities can be challenging for small businesses to balance. By transferring non-core processes, like accounting, to a BPO, an organization has more time and energy to focus on its primary business objectives.
Working with a BPO allows an organization to expand in-country and around the world. If an organization wants to grow out of the country, some activities require local market knowledge, being fluent in the local language, and national law expertise. This makes the expansion process quicker and more efficient.
Making the BPO Decision
Transferring in-house work like accounting and bookkeeping to a BPO services company may require a change in management practices, business operations, and workflow practices. However, the benefits often far outweigh the challenges that come from the change.
Fusion CPA invites you to learn more about our outsourced accounting services. We want to help you grow your business by using an expert team of outsourced controllers and state-of-the-art technology to help you take control of your business. Schedule a call by clicking the discovery button below.
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