what is bpo ?
What is BPO and its pros and cons
BPO is an acronym for Business Process Outsourcing. As the name suggests, it refers to the engagement when a business, since we are referring to business processes, engages, or contracts, another business, for the purpose of getting them to handle some of their processes.
According to Techopedia, “Business process outsourcing (BPO) involves using a third-party provider company for any business process that could otherwise be done in-house, especially those considered “non-primary” business activities and functions.
Examples include the outsourcing of payroll, human resources (HR), accounting and customer/call center relations, as well as various kinds of data gathering, front-line service work, among others. Some types of BPO are also known as information technology-enabled services (ITES).”
Evolution of BPO
While attempting to understand what is BPO, it would be relevant to also look at its journey and the path it has traversed over the years.
A free market creates a competitive business environment.
Each business makes an effort to open up a distance between itself and its competitors in an effort to maximize the profits and returns over a long period of time.
This is done through strategies that either increase the revenue or reduce its expenses so that the gap between the two, known as profit, that is attributable to its owners or shareholders, is increased.
This is, of course, a simplistic view, more for the purpose of illustration, as the real world is complex and there are multiple variables at play at all times that determine the success or failure of a business.
BPO fits in with the cost reduction part of strategy in most companies.
As consumer franchises started growing, mostly in the western world to begin with, it created a pressure on manpower and real estate.
Till then, businesses were used to operating out of real estate, depending on their pockets, in the big cities as that is where most business was generated from.
With a rise in volumes, faced with the prospect of renting more real estate and hiring more expensive workers in the big city, companies stated exploring hiving off activities that were neither customer-facing nor needed to be done in real time, so that downtown real estate could be optimized and instead those activities could be done from a location that was not far off, perhaps only at an arm’s length, but much cheaper with access to lower-cost workers.
Businesses kept growing, as did competition.
With the success of the initial outsourcing, and no longer having to clarify what is BPO to naysayers, the appetite for setting up processing further afield had developed, aided by the growth in air transport networks and supporting businesses like couriers, leading to the next phase of growth.
The growth had also given rise to a specialized kind of company that had expertise in business processing activities.
Some specialized in activities like Contact Centers, while others offered a wider variety of services.
Many companies have found value in not merely hiving off the non-customer facing and non-time critical elements of their processing, but to engage a BPO company that is often able to deliver better value than they would get by doing it themselves.
With the growth of telecommunications and related technologies, the dependence on physical documentation moving from one place to another also reduced.
Source documentation could be scanned across to the processing center enabling work to be done without having physical documents available.
This paved the way for anywhere processing which is what we have seen grow over the last 30 years or so, gradually penetrating to underserved geographies around the world in step with the expansion of the internet network.
With a pedigree of over 8 years, led by a team of professionals with over 20 years of hands-on experience, oWorkers is a credible player in the BPO space, especially adept at working on modern business processes.
What is BPO and the benefits it delivers
Cost Control
As we have seen, expansion of consumer franchises led to a substantial increase in processing activities and the need for more manpower and real estate.
With the help of outsourcing, companies were able to keep these costs in check and deliver value to customers and owners.
At oWorkers, our clients, especially from the US and Western Europe, consistently report savings of up to 80% when they engage us for their BPO requirements.
They also find our pricing strategy, where we give them a dollar per unit of output and a dollar per unit of input price, and ask them to choose the one they prefer, unique and beneficial.
Technology
Technology, as we know, is the facilitator of the BPO industry.
What is BPO to some is ITES, or Information Technology Enabled Services, to many others. An individual business may not have the resources or interest in investing in technology for improving its business processes.
However, a BPO company, which is able to bring volumes of multiple clients together, develops the heft as well as interest, it is their core business after all, to invest in technology, leading to enhancement of processing efficiency.
oWorkers has forged lasting relationships with major technology providers.
This enables us to access cutting-edge technologies for client needs.
Clients benefit as it is their projects this technology is used on.
Speed of processing
With centers mushrooming around the world, outsourcing can result in faster processing and shorter turnaround times.
Time zones around the world act as natural speed enhancers.
When the outsourcer shuts down for the day, the partner is starting work for the day.
When they finish their day, the client is about to begin the next day at work.
They find that yesterday’s work has been completed while they were sleeping.
In addition, many BPOs make it a point to ensure they are equipped to operate on a 24×7 schedule, if a client project requires it.
oWorkers is equipped to operate 24×7 in all its three global centers.
Access to human resources
Each business expects its employees to be knowledgeable and experienced in ways that are conducive to delivering better products and services and creating value for shareholders.
Each successful business has to often perform a variety of different functions, requiring different skills and knowledge in the people who carry them out.
For processing activities, often performed in large volumes, the level of skill and knowledge required is often different from the core functions of the company.
It often leads to conflict in terms of hiring and training the right people, or ends up being uncompetitive in terms of cost.
Hiving it out to a company that specializes in hiring and training resources that are suitable takes away a basic challenge from the principal.
As a preferred employer in all our delivery locations, oWorkers has access to the choicest talent.
In fact, we even save money on hiring as we do not need to advertise, as we get a steady stream of walk-in applications in our centers.
Our access to talent also enables us to handle short-term peaks for clients, which saves them money as they do not need to retain resources the rest of the year for the purpose of handling spikes.
We can hire almost a hundred additional resources within 48 hours. Though the industry was not well known a few years back, with our efforts, the ‘what is BPO’ question from jobseekers has more or less been answered.
They know what the industry is all about and they have been witness to its growth.
Specialization
The company that is outsourcing can continue to specialize in its core business while actually engaging another specialist who can, arguably, perform those activities in a more professional and efficient manner.
Thus, it is a win on both sides.
In a competitive world, it is important to stay sharp with one’s core business rather than being distracted by activities that are in the nature of support.
oWorkers provides a wide variety of offerings in the broad area of data related services, to many clients from all over the world.
We have been selected as one of the three top providers of BPO services in our chosen area of work.
Globalization of economic benefits
BPO has been a catalyst in globalization and delivering economic gains to many less privileged communities around the world.
By moving processing activities to the most economically efficient locations, it distributes economic welfare around the world and draws marginalized communities into the technology revolution sweeping across the world.
No wonder that political leaders are willing to give concessions to companies for setting up BPO processing facilities in their geography, as it will promote job growth.
Your work enables oWorkers to employ a few more people from the less fortunate communities we work with, and give them an entry ticket to the digital economy of the world.
Partnership for supporting growth
In their quest for growth, which is an imperative for all businesses, they look for partnerships that enable growth, and not block it.
A BPO partner is a good example.
In a bid for growth, with a capable partner, a company has a much shorter worry list compared to what it might have if it did not have a BPO partner.
Now it knows the BPO partner will make arrangements to provide support for the growth, as it is their core business.
For example, with its proficiency in 22 languages, oWorkers is well equipped to support the growth of its clients’ business even across multiple geographies and in multiple global languages.
What is BPO may be anathema to some
Occasionally noises erupt against companies outsourcing their business processes. These are normally ranged around two parameters:
Loss of jobs
This has been one of the shrillest cries against outsourcing business processes.
People who have never questioned buying Japanese cars and athletic shoes made in Bangladesh, suddenly become patriotic and start believing that globalization of business is bad for them and that they are entitled to keep their jobs doing business processes even though someone else might be able to do it better, faster, cheaper.
It cannot be denied that jobs will be lost in one place and gained in another.
Hopefully, like water finding its path through the lowest areas, this is also a natural process meant to attain economic equilibrium.
oWorkers creates jobs for the less privileged, wherever it operates.
It often receives invitations from political leaders from around the world for setting up delivery facilities.
Data security
Information is critical to a business.
Information about products and services. Information about their customers.
Information about the competitive landscape as well as competitors.
All these are variables in the strategy that the company keeps refining in a bid to stay ahead.
Outsourcing requires vital information to be shared with the provider, otherwise how is processing to be done.
While it is minimized, it cannot be eliminated altogether.
While it cannot be guaranteed, beyond technology solutions for security, it is often argued that data security is subject to the integrity of individuals, the likelihood of which is as much or as little if the client were to process it themselves.
There could also be conflicts with national policies.
Some countries may want to retain certain information on servers physically within the country.
These have to be handled on a case-to-case basis.
Besides being GDPR compliant, which is a requirement as we operate from the Eurozone, oWorkers operates out of super secure facilities that are ISO (27001:2013 & 9001:2015) certified. We also offer physical segregation of projects through access control, if required.
Conveying the client’s brand and voice
This is particularly true when processing activities require an interface with the external world, such as customers.
Each company has an ethos, an image that they project to the external world.
When you outsource, do you compromise on that face, that brand value?
While there is no single or simple answer, it normally involves working with each other and narrowing the gap in that projection, if any, and ensuring consistency.
With the help of a dedicated training team, all new hires are required to undergo training before starting work on a client project.
Training can vary from one client to another.
Where the project has a front-facing role that would be visible to the external world, the training is much more detailed and covers all aspects of such an interface.
Besides, refreshers are provided from time to time to ensure that staff is always updated.
Final Word
What is BPO is no longer the question.
The answer is now well known.
When do we go the BPO way or which BPO to partner with may be the more relevant questions today.
oWorkers counts many unicorn marketplaces amongst its global clients.
We hope you will choose oWorkers, as have many businesses around the world.
