Everything you need to know about Business Process Outsourcing (BPO)

As a business grows and demand increases, it can be difficult to control the costs and the overall efficiencies of non-essential business functions.

In other cases, some businesses simply don’t want to manage tasks that aren’t aligned to core business competencies. In both situations, a lot of businesses outsource these tasks to a third-party provider. This is called Business Process Outsourcing (BPO).

Unfamiliar with BPO and how it can help your business? Read on for everything you need to know.

What is the definition of Business Process Outsourcing?

Business Process Outsourcing is the contracting of non-essential business tasks to a third-party provider. BPO refers to the outsourcing of a process – either front office or back office work.

The BPO industry can be broken down into three categories, each based on location:

  1. Offshore outsourcing: hiring a third-party provider to perform business functions in a country outside where the products or services are developed or manufactured. For example, expanding your customer services to other countries and provide a native experience for the customer.
  2. Nearshore outsourcing: the third-party provider is in a neighbouring country to where the business is located. For example, if your business is in Ireland, in this case, the BPO provider would be in the United Kingdom or another nearby country.
  3. Onshore outsourcing: the BPO provider operates in the same country as the contracting business.

What kind of business processes can be outsourced?

The following business processes are examples of what can be outsourced by a BPO provider:

  • Payroll: the BPO provider will take care of paying employee salaries, expenses, taxes and any accompanying accounting duties.
  • Customer Service/Support: the BPO provider will take care of a range of customer service duties. They will provide support for your customers and making cost effective and correct use of your service or product. – again this could be worded a bit more concisely
  • Marketing: this is a common form of Business Process Outsourcing. The vendor will take care of part or all of the marketing duties on behalf of the business. For example, a business might outsource their social media activity to an external marketing agency.
  • Accounting: the BPO vendor will keep record of all finances, including costs and taxes.
  • Medical billing: the duties of the BPO provider will include regular invoicing, verification, collections assistance, referral coordination and reimbursement tracking.
  • Development or Operational Activities: the BPO provider will take ownership of designing and controlling the process of production and redesigning business operations in the production of goods or services. This is most common with the manufacturing industry.
  • Technical Support/Help Desk: the vendor will provide either customers or business employees assistance on technology products or IT services.
  • Inbound/Outbound Sales: the BPO provider will take full ownership of the sales cycle and be responsible for generating revenue from your product or service.
  • Quality Assurance: the BPO provider will ensure that your product or service is of a high standard. This includes regular auditing and testing of various aspects of the business and product.

What are the benefits of Business Process Outsourcing?

Cost-effective

Outsourcing can significantly reduce staffing and training costs. BPO can also reduce the work space needed to accommodate employees, which again will reduce costs.

Time-efficient

A lot of time goes into building a whole new infrastructure in a business – especially if it’s not your primary field of expertise.

For example, if you’re looking to build a customer service team internally, you’ll need to make sure you’re equipped to effectively manage and each aspect of that team, as well as ensuring that the service is representing your business in the best way possible.

The right BPO provider will have this built and ready to go, as well as the experience and expertise to manage it. This will reduce the time needed to expand your services properly.

Flexible to suit your needs

Business Process Outsourcing can be scaled up and down to suit the needs of the business. Internal resources can also be reassigned to more critical functions of the business.

Expands your global presence

BPO provides a quick way to expand a business’s presence worldwide. For example, if you’re looking to expand your customer service offering in a variety of languages and around the clock, a BPO provider can provide that.

Are there any risks in Business Process Outsourcing?

Most of the risk in BPO is associated with the quality of the BPO provider.

For example, if you’re planning to outsource your manufacturing needs, if the BPO provider isn’t suitable to build your product, the quality of that product will suffer. This will have a significant knock-on effect across your business, as well as the bottom line.

So what do you need to consider when choosing a BPO provider? Here are some questions to get you started.

1.      Am I getting value for my money?

BPO can potentially provide services more efficiently and at a cheaper rate, but if the price you’ve been quoted to outsource these services is too good to be true, it almost always is.

Picking the cheapest BPO provider could mean sacrificing some quality along the way. At the same time, in a lot of instances, hidden costs could arise and accelerate costs unexpectedly.

To ensure that you’re getting the most out of your budget, don’t be afraid to dig deep and ask as many questions as possible before committing.

2.      Do they have the necessary experience for my business?

Every business and industry have a unique set of requirements; there is no one-size-fits-all approach for Business Process Outsourcing and it is not a straight-forward task to manage.

If you’re shopping for a BPO provider, it’s essential that they understand your unique business requirements.

Make sure that your BPO provider has previous experience and the particular skills you need to grow your business.

If you have goals that you’d like to achieve from hiring a BPO provider and you’re investing budget, it’s important that your BPO provider can meet those demands. The more relevant experience they have, the higher the likelihood of them reaching those goals are.

3.      Do they have the right technology?

Having the right technology is essential to delivering the service you are outsourcing correctly. The right, or wrong, technology will impact efficiency, which in turn affects your budget and the quality of that work.

For example, if you’re looking to outsource or expand your customer service duties, does the BPO provider have the right technology which can:

  • Resolve your customer queries as fast and efficiently as possible
  • Handle the volume of inquiries
  • Effectively record and escalate all instances

4.      Can the provider fully secure all personal information and data?

In the age of GDPR, if you don’t treat the data you hold with the strictest of confidence you could face heavy fines.

In the interest of the integrity of your business (and your bottom line) it’s important to check that your BPO provider has the infrastructure and competence to protect your data.

5.      Do they have the expertise to recruit the right people?

Business Process Outsourcing and recruitment go hand-in-hand. It’s important that your provider has the skills to screen and evaluate candidates who are right for the services you require and the right people to represent the values of your business.

What makes Cpl different for Business Process Outsourcing?

BPO service centres across Europe

Cpl has BPO service centres in Dublin, Cork and Central Europe that serve customers in 12 EU countries. With over 1,000 employees speaking over 20 languages Cpl is one of the largest providers of multilingual service desk services.

cpl bpo locations

Full access to recruitment services

Founded in 1989, Cpl is Ireland’s largest recruitment agency and a global provider of talent solutions with 36 offices in 9 countries and 10,000 employees in client sites. These solutions range from Recruitment, Managed Services and Strategic Talent Advisory.

You will have access to Cpl’s unique suite of talent solutions and candidate database of over 1.5 million profiles. combined with state-of-the-art AI capabilities with Salesforce to help you identify and qualify the best candidates in a shorter amount of time.

Financially stable business

According to our 2018 Annual Report, in the financial year to June 30th 2018, Cpl delivered double-digit growth in revenues and profit before tax, with a revenue increase by €67.5 million to €522.7 million (2017: €455.2 million).

Corporate Social Responsibility

At Cpl, giving back is integral to everything we do. Through our many Corporate Social Responsibility incentives we aim to better people’s lives and the communities in which we operate in.

We enable our staff to choose the charities we support, and we support them in in four main ways:

  • Volunteering of Staff Time: We encourage all our people to use two paid volunteering days each year. These days can be used individually or as part of a team effort to benefit a cause or community of their choice.
  • Community Involvement & Skill Sharing: Our people are experts in their fields and are keen to share useful, practical advice with those less fortunate. We have strong relationships with minority and educational groups across Ireland.
  • Using Digital for Good: As Ireland’s largest recruitment agency, we have an extensive global network of candidates and clients online. We use our social media platforms to promote charities and our CSO ethos through the hashtag #CplGivingBack
  • Philanthropy: Cpl has collaborated with charities to host several internal fundraising events all over Ireland and Europe. We have also collaborated with charities to host several internal fundraising events

Diversity and Inclusion

Diverse talent is essential to creating effective solutions and processes for our people, our clients and our candidates and we’re proud to have employees of over 100 nationalities, who each come from different backgrounds and share a unique perspective.

We invest in the Future of Work

The Cpl Future of Work Institute is an initiative that explores, questions and helps design future work solutions with our clients, partners collaborators and candidates.

We conduct research, workshops and engagements across 7 core areas: Diversity & Inclusion, Talent Technology, Employer Proposition, New Workforce Models, Creative Leadership, Government & Regulatory, Future Skills.

Interested in a Business Process Outsourcing solution?

Are you considering outsourcing a business process? Why not request a free consultation with a member of our team and we’d be happy to help.