5 Advantages of Business Process Outsourcing
Updated: Nov 14
Running a business is a delicate balance between leveraging your skills and those of your employees, maximizing your use of time, and cutting costs where possible. That’s why sooner or later, most companies will consider outsourcing some of their operations.
Business Process Outsourcing (BPO) offers many advantages to companies both big and small, by allowing them to outsource key business operations as needed. Here are the five most critical ways that BPO can help your business thrive.
1. Reduce Costs
The only way to survive in business is to keep your costs as low as possible, and staffing will often be one of your biggest expenses. That’s because full time staff require full time benefits, as well as training and replacement costs, taxes and more. For example, a traditional contact centre will spend 60-70% of its overhead on its labour force alone.
By using BPO to outsource cumbersome duties like customer service, accounting or human resources, companies can greatly reduce costs associated with additional staffing.
The right BPO can also help you to save money on technology infrastructure, by outsourcing your ITIL framework.
This type of cost-cutting is one of the main ways startups in particular can benefit from BPO (see more ways startups can benefit from BPO here).
2. Gain Expertise
With BPO, you don’t need to have experts on your payroll to have experts working towards your success. When you find the right company to work with, you can leverage their trained staff, so that your trained staff can focus on what they do best.
Say that you’re ready to grow your social media presence, but you can’t afford to hire a full time marketer. You have two options. First, you could try to do the marketing yourself, or assign even more duties to someone on your team. This will take your attention away from important things like growth and sales, and you’ll likely end up with sub par marketing, too. It’s a lose-lose .
Or, you can use BPO and find experts whose only focus is on digital marketing. They’ll manage your digital footprint much better than you can, while allowing your attention to stay where it should be.
3. Scale Easily
BPO makes it easy to scale in either direction, making it a particularly great option for young, growing and seasonal companies, and for those that often take on special projects.
Growing and reducing staff is expensive and difficult. It’s so much easier to outsource that HR work to a company that will take care of hiring, training and laying off staff directly, and whenever needed. In this way, BPO helps your company stay more responsive, easily able to adjust to boom and bust cycles.
4. Manage Staff
Managing staff is tedious, and it can drain time away from critical growth work. The beauty of BPO is that you can have an army of skilled professionals working on your business, who aren’t actually your employees. Without any of the complications of managing these employees, you’ll save time, money, and lots of headaches.
And don’t forget that you can also outsource your human resources itself, taking staff management out of your hands completely.
5. Streamline Systems
Finally, BPO can help you streamline your operations. Just because you’re great at sales, motivating staff and seeing the big picture, that doesn’t always translate into knowing how best to utilize your resources and run your business.
Especially in today’s world, streamlining your business planning and organization, in conjunction with your technology and infrastructure, is make-or-break. And this can be very difficult and costly to do in-house.
That’s why many companies choose to outsource this type of work to experts that offer advisory services, getting the right materials, road maps and systems in place, at a fraction of the cost.
Because BPO is so multifaceted, and because it offers so much flexibility, there are ways for just about any type of company to see benefits from it. Ultimately, each company will need a unique combination of BPO to meet their goals.