Globalization is at its peak as we are becoming more interconnected these days. Due to increasing globalization, organizations are striving to achieve excellence in their product and service delivery. Since all sectors are interconnected so they are interdependent. A simple disruption caused in one business sector impacts another business sector. One needs to stay pivoted more than being competitive because the marketplace is highly volatile.
BPO Industry for Major Business Sectors
Whether a business delivers products or services, customers remain the central point of their universe. So whatever they do, they must ensure their customers receive comprehensive treatment. There are 2 major focus points of a business - product/service delivery and customer relations. While a company focuses on improving products and services, it must ascertain there is someone trustworthy, dealing with customer concerns and issues.
Hence, this is where the BPO industry steps in. A BPO agency is extremely important for companies dealing with a large customer base because they have to make sure they have the best people for ensuring optimal customer retention and acquisition. Sales and marketing have become a huge spectrum and only a learned group of professionals can truly ensure the maximum sales and marketing results.
Business process outsourcing (BPO) refers to the practice of outsourcing specific business functions to third-party service providers. BPO services can benefit businesses in a wide range of sectors, including:
Financial Services: BPO service providers can handle functions such as payroll, accounts payable, and customer service for financial institutions. Things just don’t end with taking care of these operations but also making a good job out of it. The third-party agency ensures that you get the maximum operational output, ultimately leading to improved performance and revenue.
Healthcare Sector: In the last decade, BPO agencies have manifested top-notch support in the healthcare industry by helping many healthcare institutions with operations such as medical billing, insurance claims processing, and patient data management for healthcare organizations. Basically anything related to data collation and computation.
Manufacturing Companies: Since all business sector is adopting digitization, so does manufacturing companies. They also render services from BPO providers for assisting them with computational works related to supply chain management, procurement, and other back-office functions for manufacturers.
Retail Industry: Quite visibly, the retail industry is most benefitted from BPO providers as they have given extensive support in order processing, inventory management, and customer service for retail businesses. Post-pandemic, the reliance of the retail industry on BPO service providers has increased two folds.
Telecommunications System: It is an intrinsic part of BPO companies. Sections like call center services, customer support, technical support, grievance support, order processing, collections, sales, and marketing already come under the wings of BPO agencies. The emergence of the BPO industry was initiated by helping telecommunication companies only.
Travel and Hospitality: There are several BPO agencies in the market holding extensive expertise in the travel and hospitality industry. The new-age BPO companies are equipped with multi-channel support capabilities so, they are able to provide better call center support related to online queries, bookings, reservations, and transactions via different channels such as voice, chat, email, and social media.
Overall, BPO services can be beneficial for businesses looking to streamline their operations, reduce costs, and improve efficiency. Considering the overwhelming benefits of the BPO industry, many organizations from different business sectors are hiring BPO agencies for supporting their front-end business operations such as sales, marketing, and public relations; as well as back-end operations to a greater extent.
Major Operations Run in Financial Institutions
Financial operations are generally transactional in nature. When we talk about financial operations, the first thing that comes to our minds is money. Monetary transactions need to be carried out very consciously and we do not have the luxury of doubts and exceptions. There is absolutely no room for mathematical errors. Therefore, the professionals working on financial operations must have strong expertise in accounting and finance.
There are multiple ways of recording and administrating financial transactions and every business has its individual way of doing it. The processing efficiency of financial transactions depends on the methodologies adopted by the respective company.
●Traditionally, we termed the process of record keeping and administration as bookkeeping. Now we have access to digital technology for processing these operations so we call them accounts and finance.
●Financial institutions, such as banks, credit unions, and insurance companies, perform a wide range of operations to support their core business activities. These operations require accuracy, agility, and intense analysis of records.
These pieces of information are compiled together so they can later be used in the decision-making process. There core financial operations taking place in these financial institutions are as follows.
Account management: Tasks involving customer account management, nurturing good relations with customers, learning customer objectives are finding new opportunities to retain business with customers. The process also involves opening, closing, and managing customer accounts, as well as handling account inquiries and maintenance tasks.
Customer Service: Financial institutions typically have customer service teams that handle inquiries and complaints from customers, as well as provide assistance with account management and other tasks. BPO agencies have been rendering this service for ages now, but with the advent of new technologies and skillful people. Now the BPO agencies will be able to provide assistance in handling the core functions of financial institutions.
Loans and Credit: Financial institutions offer a variety of loan and credit products, such as mortgages, personal loans, and credit cards. They handle the processing and approval of these applications, as well as the management of the loans and credit accounts. These types of financial operations require regular interactions with customers.
The conversations held with customers can be quite critical due to the prevalence of complications in the loan and credit facility procedures. To keep the situation under control, the professionals dealing with customers must have strong knowledge of loan and credit procedures. The BPO industry has helped these institutions in streamlining their operations.
Investment and Wealth Management: Financial institutions may offer investment and wealth management services to help customers grow and manage their wealth. This can include offering a variety of investment products, such as stocks, mutual funds, and retirement accounts, as well as providing financial planning and advice.
Affluent people possessing a decent amount of wealth render services from financial experts. These experts have in-depth experience in investment techniques that can help these affluent people to sustain their wealth, and possibly increase their wealth by opting for one of the investment methods such as stock exchange, mutual funds, share market, etc.
Risk Management: Some financial institutions are focused on identifying or foreseeing financial threats. These institutions have financial risk managers who have first-hand knowledge of historical cases of financial crises and existing contingencies at play. Keeping that into consideration, they devise countermeasures for evading financial risk and threats of all kinds. Even the financial institution themselves are prone to various risks.
The risks such as credit risk, market risk, and operational risk. They have teams in place to identify, assess, and manage these risks. These FRMs are responsible for averting threats to assets, business risk analysis, and solving financial crises. Our current market condition is constantly fluctuating and is more volatile than ever. By integrating certain BPO technologies and skillsets, we perform these functions in a more streamlined and effective way.
Compliance: Most of the financial operations are subject to escalations due to obvious reasons so there are regulations and guidelines for processing the operations uninterruptedly. Adherence to these regulations should be strictly monitored. These agencies require compliance teams that handle tasks such as monitoring compliance, conducting audits, and reporting to regulatory agencies.
BPO Industry can Lend a Helping Handing to the Finance Industry
Now we all are quite aware of the time when outsourcing businesses came into existence. Through the ages we have seen businesses have always been customer-centric; in other words, a business can’t truly exist if it can’t handle its customer base. Customer acquisition and retention have always been an integral part of any business. Therefore, the emergence of the BPO industry made total sense, and its demand for outsourcing services is surging.
●Business outsourcing was always quite promising ever since its beginning; however, in order to operate your business functions, it needs to gain access to some integral information about your company that is quite critical.
●For obvious reasons, experts from the finance industry were quite skeptical about outsourcing their front-end operations such as sales, marketing, and public relations. It posed a little bit of a threat to security compliance as it involved extracting some monetary transactional information.
●Things have changed a lot these days. With the advancement in security protocols, financial institutions are taking full leverage of BPO services. BPO industries are good at creating rapport between customers and finance companies (Having a good rapport is crucial for financial companies, especially in this line of business). Hence, reducing operational costs and adding value to the customers.
The 2007 global economic crisis was a tragedy but it instilled all the financial institutions to be more vigilant and extra cautious with their operational quality. Also, they should tailor impactful strategies to avert any possible contingencies that might occur in the future. For reviving from the post-traumatic effects of the recession, the banking sector started exploring every possible means that can help them to optimize their operations.
Business outsourcing agencies became one of the viable options as they took control of menial and tedious tasks. There were many gaps in the regulatory framework so the whole financial sector was under pressure for establishing innovative measures for bringing sustenance. BPO services are more than capable of handling non-strategic functions like payroll and logistics. Fortunately, the BPO is extending its area of expertise even further.
Ways Through BPO Services can Help Finance Industry
The quest for improving working efficiency never stops so, every company searches for innovative methods and strategies for obtaining maximum results. However, with the continuously changing business landscapes, evolving market trends, advancing cutting-edge technologies, and increasing customer demands, companies find it extremely challenging to keep up the pace with regard to these aspects.
Especially, companies providing financial services, and managing most of the operations in-house are privy to these challenges. These are essentially the pain points that most financial institutions are unable to overcome.
●Fortunately, Finance Process Outsourcing, a part of business process outsourcing offers financial firms to subcontract finance and accounting functions to third-party agencies.
●By handing over some of the non-strategic grunt financial operations to a third-party agency, financial institutions can actually meet the criterion for achieving optimal work efficiency.
●Not just improving the performance, but also improving revenue income by cutting costs of operating tedious and time-consuming financial tasks.
There are several ways a financial enterprise can leverage the resources of third-party companies. In fact, strategizing the financial operations in the most cost-effective and organized way is paramount for these firms, let us see how we can do that.
Hiring the Right Skills and Talents for the Team
Companies dealing in finance operations and services are already caught up with tons of work and they seldom get enough time to contemplate other areas of operations. However, it is also important for enterprises to make sure they have assigned the right and qualified professionals for the job.
It is not easy to manage processes like recruiting, training, onboarding, and retention. Therefore, hiring an outsourcing company would be the best bet for hiring and onboarding skilled accountants for efficient delivery of work. BPO companies are more than capable of handling the tedious recruitment job on your behalf.
The finance industry is the most critical industry in the world. So, it needs the most support from technological advancements taking place in the world. Furthermore, like many other industries, finance industries also struggle to keep up with the fast-moving technological landscape - one of the main reasons for being too busy with the ongoing grunt operations. For deploying suitable technology, enterprises would also need the right infrastructure.
By having associations with a BPO provider, finance companies get access to the latest tools and techniques for delivering high performance and agility at work. At the same, the clients don’t need to worry about the upgrades. Especially, small and mid-sized enterprises can reap the maximum benefits by tying up with BPO providers as they can get access to enterprise-level resources at more cost-effective prices.
Use A Variety of Tools for Performing Financial Tasks
Outsourcing can help to streamline financial reporting by bringing all of the necessary data into a single location, eliminating the need to use multiple tools and software to access and aggregate data from different sources.
This creates a "single source of truth" for financial information, making it easier to generate accurate and up-to-date financial reports. By relying on a single, integrated solution for financial reporting, companies can save time and resources and improve the accuracy and reliability of their financial data.
Handle Complex Accounting Tasks
Outsourcing can help to simplify the interpretation of complex financial data by providing regular, easy-to-understand reports on the company's financial position. These reports, which may include income statements, cash flow statements, and other analysis reports, can be generated by the outsourcing provider and made available to all relevant stakeholders.
This can help to improve communication and collaboration between finance and non-finance teams and provide a clearer understanding of the company's financial health for all employees.
Finance Process Outsourcing is Cost-Effective
Outsourcing financial management can save time and money for a company by allowing it to focus on core activities and delegate non-core tasks, such as accounting and financial reporting, to a specialized service provider. This can help to free up internal resources and reduce labor costs, as well as improve efficiency and focus.
By outsourcing financial management, a company can also take advantage of the expertise and specialized knowledge of the service provider, which can help to improve the accuracy and reliability of its financial data and reporting.
Through all the above-mentioned points it is clear how beneficial finance process outsourcing can be. For several years, experts have been scrutinizing BPO providers for their compliance with security protocols. However, as our technology services are becoming robust every day, the security protocols have also been upgraded greatly. There are several potential benefits to outsourcing finance processes, including:
Cost Savings: Outsourcing can help to reduce labor costs and other expenses associated with managing finance in-house.
Improved Efficiency: A specialized service provider can often complete financial tasks more efficiently than an in-house team, freeing up time and resources for other activities.
Access to Specialized Knowledge and Expertise: An outsourcing provider can bring a higher level of expertise and specialized knowledge to financial tasks, which can improve the accuracy and reliability of financial data and reports.
Improved Focus: By outsourcing non-core financial tasks, a company can focus more on its core activities and strategic priorities.
Risk Management: Outsourcing can help to mitigate risks related to financial management, such as compliance risks or the risk of errors and omissions.
Hence, it is clear that all financial institutions should leverage BPO services in the best possible way. Furthermore, BPO services in our current ecosystem are scalable and flexible up to great extent - meaning, you can avail of BPO service depending on the company's specificities in a pay-per-use model. A lot of BPO services are becoming cloud-oriented these days, which means it is only going to add up to the operations efficiency level.