Top companies, such as Microsoft, American Express and Aetna, will be the first ones to tell you how outsourcing maintains their competitive advantage. These companies have found the perfect business process outsourcing (BPO) partners for them, which now optimize their work flow, cut back their costs, bring them more revenues and increase their savings.
But multinational companies are not the only ones who can benefit tremendously from outsourcing. Even medium-sized businesses and startups can be better at what they do when they outsource all their peripheral needs to outsourcing companies.
What is Outsourcing?
The meaning of outsourcing or BPO has evolved over time. Several years ago, it merely pertained to the contracting of a company or a group by another organization to work on business processes end-to-end. This has changed over recent years to refer to the delegation of IT-related business processes to external providers who have the specialized people and equipment to manage these processes based on a set of metrics previously agreed upon.
Factors that push companies to outsource include heightened competition due to economic globalization, deregulation, mergers and acquisitions and shortage of skilled manpower in fields such as IT, finance and HR. Cost savings are still the main draw for companies when it comes to outsourcing, but they are also realizing more and more that other benefits like innovation and marketing speed are equally important as well.
How to Find the Right BPO Partner
So how do you find the perfect BPO partner for you? The right partner should allow you to focus on what you do best. For example, the core competency of Syncrude Canada Ltd. In Alberta lies in refining sand oil into gasoline or crude oil. To better manage their control processes, such as maintenance of pressure and temperature, they outsourced them to an industrial outsourcing company. Since then, Syncrude has transferred their design, maintenance, construction, procurement and installation processes to their BPO partner with brilliant results.
Another multinational company putting BPO to work is IBM. Handling of its project termed Windows Millenium Upgrade was outsourced to another IT company. IBM provides the products to its outsourcing partner while the partner works on all processes related to online order fulfillment. Through this effective partnership, IBM is able to operate all their worldwide mechanisms and set up proper distribution facilities in various geographic locations. Left alone, IBM couldn’t possibly handle these diverse currencies in a cost-effective manner.
And of course, one of the largest sectors of BPO is customer service. Companies like GE Capital, Epson, AltaVista, even MGM are outsourcing all their customer service processes to firms with dynamic customer relationship management (CRM) systems, which are made up of hardware and software for redundant work. These companies are also relying on outsourced customer service representatives who make use of phone, Web chat and e-mail for all their order-taking, accounting, and other customer service-related needs.
The ultimate question to ask yourself if you need a BPO partner or not is this: “Is this my core competency?” If the answer is “no”, you should definitely find an outsourcing partner right away to secure the future of your business.