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Business Process Outsourcing Models- How to choose the best model for your business?

Posted by Neha Dubey
Business Process Outsourcing Models

Business process outsourcing is one such trend that is becoming a part of all successful businesses. It has offered businesses a platform through which they can handle their processes with success without any hassle and major investment. Moreover, this approach facilitates innovation, fills existing expertise gaps, and speeds up projects, no matter how large or small.

In this article, we will discuss what business process outsourcing is, BPO service models, and how to select the one for your business. 

What is Business Process Outsourcing?

Business process outsourcing (BPO) refers to the delegation of the management of one or more IT-intensive business processes to an external provider, which then owns, manages, and oversees the selected processes based on defined and measurable performance metrics.

The practice of outsourcing involves contracting the services, business processes, and operations to external vendors. There are also several subcategories in BPO services that describe the location and function of the services provided. 

What are some Popular Business Process Outsourcing Models? 

1. Dedicated Teams 

Dedicated teams give your business direct access to experts. In this business process outsourcing model, you share ownership of the project with your outsourcing partner. A dedicated team is assigned to your project who solely handles and manages it. 

Outsourced project managers manage the team. These developers work for your organization outside of your control. You and the team agree on things like responsibilities, objectives, and timeframes. In this model, proper communication is key to guiding it to success.

For this BPO service outsourcing model, you need to have an experienced project manager who ensures that the dedicated team working on your project sticks to your vision and delivers the desired results. 

Pros 

  • Economically reasonable 
  • Fast-paced development cycle
  • Promotes collaboration
  • Offer complete control
  • Continuous integration 

 

Cons

  • Hiring might take time
  • Good for long-term projects

2. Staff Augmentation

By staff augmenting your existing team, you can maximize your in-house engineers' efficiency and skills while maintaining complete control over the project. It is one of the best options for your organization to increase production. With staff augmentation, you can have the resources you want in-house to ensure better coordination and communication. 

Staff augmentation is an ideal way to bring experts in-house to achieve the desired results. This model is also beneficial as it is difficult to find qualified developers due to the tech talent shortage. Moreover, hiring full-time employees does not always work out to be the best solution. 

Pros:

  • Easy & Quick access
  • Economical 
  • Get the talented professionals
  • Flexibility & scalability 
  • Complete control over the project

 

Cons:

  • Complete Accountability 
  • Communication gaps 
  • Difficulty in collaboration 
  • Managing outsourced professionals

3. Project-based Outsourcing 

It is one of the most preferred business process outsourcing models. In this model, you can outsource any business process of your choice. When you outsource based on the project, your partner handles and manages everything associated with that project. In the end, it is your partner's responsibility to complete the project and deliver it to you. 

All you need to do is to share the requirement with your partner, assign them the deadline, and they will deliver it to you. 

A project-based outsourcing arrangement works well for companies that know exactly what they want. Once you have briefed the outsourcing team, you are free to focus on other aspects of the business. A project-based outsourcing arrangement works best for projects outside your core competency.

Pros 

  • Time-efficiency
  • Timeframes restraint
  • Cost-effective
  • Precise hiring 
  • The project manager owns the responsibility

Cons 

  • No complete control over the project 
  • Results can be slightly different 

How to Choose the Best BPO Service Model for your Business? 

While choosing an business process outsourcing model for your company, you need to consider many factors, including the type of project, the partner's expertise, the contract, and the deadlines. 

Before you make a decision, check on all these aspects to choose the best outsourcing model for your business:

  1. Check for a strong online reputation. 
  2. The deadline offered to complete the project. 
  3. The suitable or preferred outsourcing model. 
  4. The flexibility required to complete the project. 
  5. A project's degree of technological innovation.
  6. Competencies and skills of an in-house team.

If you are drafting a contract with an outsourcing company, you should keep these factors in mind. You should ask your potential technical partner for advice before you make your decision. Describe your project, requirements, time frame, and budget. Doing it all will not only help you make an informed decision but will also help you avoid all the hassles. 

What are the Benefits of Business Process Outsourcing?

 

Business process outsourcing allows companies to drastically reduce the amount of work they have to do while concentrating exclusively on other aspects of the business. By outsourcing to a third-party company, which is already knowledgeable about the business, they can reduce their costs while increasing efficiency. 

Cost-effectiveness

One of the primary reasons for outsourcing business processes is that it helps organizations cut costs and save money. This pool of talented employees at low wages results in huge cost reductions, which in turn lead to increased profits.

Focus on Core Competencies

As the company outsources a substantial portion of its operations, its top management can concentrate on its core business areas. It, in turn, benefits employee productivity and facilitates making better and more informed business decisions.

Access to trained professionals 

Hiring new employees and training them is a complicated process that involves significant costs for a business. When a business outsources recruiting and training, the company does not have to deal with these hassles.

Result in better customer feedback 

Employees of BPO companies stay directly in contact with customers. They can get firsthand feedback on products and services. The valuable feedback provides the company with an opportunity to better its services.

Availability of latest technologies

The cost of licensing the newest software and other technological advances is very high. It is also risky, especially for small and medium-sized businesses that cannot allocate a steady budget for purchasing the latest technologies. 

Therefore, it becomes more difficult for a company to stay abreast of technology updates. As a result, outsourcing to companies that already possess the necessary expertise and have access to technology can be more advantageous for global organizations.

Better employment opportunities 

BPO is one of the top employers in most countries. It is ranked second in some Asian countries for the number of jobs produced.

As a result, there is also a good remuneration package available to employees, one of the main reasons why young people choose to go into the BPO industry. The BPO industry has created jobs for many talented youngsters and has drastically changed the GDP of various small countries.

What are some Industries that use Business Process Outsourcing? 

Industries that use Business Process Outsourcing

  1. Travel Industry 
  2. IT/ITES
  3. Financial services 
  4. Healthcare services 
  5. Retail services 
  6. Telecom Sector 
  7. E-commerce industry 
  8. Manufacturing Sector
  9. Educational Institutions

What are some Commonly Outsourced Business Processes? 

Different businesses have different needs, which is why the choice of process to be outsourced also varies. Here are some of the most commonly outsourced business processes: 

1. Customer Service- Good customer service typically means providing timely, attentive, upbeat service to a customer, and making sure their needs are met in a manner that reflects positively on the company or business. And outsourcing Inbound Call Center services is the best way to offer the best customer services and experience. 

 

2. Payment Processing & Accounts- It involves handling and managing the financial processes and accounts of the company. When you outsource call center services, you get a team of experts who handle these processes with their professional expertise. 

 

3. Online Marketing- In today’s scenario, all businesses need to go online and reach out to their target audience. To achieve that, you can always consider outsourcing Inbound call centre services. 

 

4.Procurement- Procurement is the process of obtaining products or services, usually for business purposes. It is most frequently associated with companies since they have to procure products or services on a large scale, usually regularly.

5.Human Resources- In Human Resource Outsourcing, as the name suggests, a company hires a third party to handle some or all HR-related activities. It may be a single firm or a combination of firms located offshore to handle HR-related activities.

Read More: Business Process Outsourcing- Build a better business with BPO & BPA services

Conclusion: 

There is no denying that BPO services are the best to scale your business. After all, it is customer satisfaction that decides the success of your business. So do your analysis and pick the business processes you wish to outsource. It will not only speed up your productivity but will also help your business generate better revenue. 

For the best BPO services, you can also contact our expert at Go4customer. They have years of technical expertise and experience to offer your business the best services.

 


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