Business process outsourcing refers to a scenario where a firm chooses to outsource its non-core activities to an external partner. That business partner, in turn, undertakes all the processes for the outsourced task. Several companies, even reputable ones outsource, not only to reduce cost but to gain access to industry leading practices and scarce skills. There are many services that a firm can outsource, but in most cases, they go unnoticed and firms fail to realise the benefits they can tap by making such undertakings – theoretical or practical. Here are some of the key services that firms can outsource to reap the benefits;
- Human resource management: Naturally, all firms should have a personnel management section – but depending on the size and complexity of the firm, performing such tasks can become a costly and even risky affair. Based on an understanding that majority of organisations are not specialised in this field, outsourcing such services is a rather wise decision. Firms that choose to outsource their human resource management allow external players handle the recruitment process and other administrative tasks that relate to employee welfare.
- Customer management and call centres: According to UCMS group, customer relationship management is one of the key and most technical tasks that a firm can engage in. Most firms handling production lines do not have such specialisations, and dedicated phone calls can be overwhelming. This, in turn, implies that the only formidable solution is to transfer such tasks to a different firm specialising in such issues. This trend has seen the rise of India as a call centre hub given that it provides reputable quality at affordable costs, while production and manufacturing facilities are situated in China, Eastern Europe and Russia.
- Accounting: Several firms are also choosing to outsource the whole of their accounts department for all bookkeeping and accounting purposes. Such arrangements have always seen the professional firms provide all accounting solutions, including the completion of bank statements, cash transfers and provision of key source materials to the suppliers. In such arrangements, the main firm only retains higher-value decision-making activities and the approval of expenditures – leveraging manpower to engage in other key activities of the firm.
- Basic IT Support: The IT process outsourcing is the most popular form of business process outsourcing given the dynamism of technology. Its process outsourcing allows an external firm to take charge of the entire ICT infrastructure of the main firm, supervise installation of new hardware and software systems as well as the provision of support in the use of such systems. Software-On-Demand outsourcing has also seen a growing popularity where firms rent the software for use with small recurring payments and not full acquisition, while the provider develops and updates such software to the standards of its customers.
Business process outsourcing helps a firm reduce cost. Cost reduction can be attained through the use of technologies that can bring administrative and other related costs under control. Outsourcing helps the company maintain lower rates with better service solution thereby giving them a better market position and a competitive advantage.
Workforce Outsourcing provides effective outsourcing solutions to various businesses. This includes analysis of the benefits and drawbacks of outsourcing for the firm, allowing it to make informed decisions on what services it needs to outsource to realize utmost efficiency and ultimately enhance productivity.