By Tennille Bell, General Manager of Sales at Programmed Process Outsourcing (PPO)
As economic conditions continue to intensify, companies find themselves under increasing pressure to survive. One strategy to combat this that continues to gain traction is Business Process Outsourcing (BPO). However, misconceptions and myths often shroud the true potential of BPO, preventing businesses from fully leveraging its benefits. To assist companies to unlock the full value of BPO in their operations, it is necessary first to debunk some common myths surrounding BPO and shed light on its diverse applications and advantages.
What is Business Process Outsourcing?
BPO is a business practice in which a company contracts out certain tasks or processes to external service providers rather than handling those tasks in-house. BPO companies, or outsourcing partners, specialise in specific processes, enabling businesses to concentrate on core competencies by outsourcing non-core functions to external experts. The primary goal of BPO is to optimise efficiency and streamline operations. The outsourcing of these processes can result in cost savings, improved efficiency, access to specialised skills, and increased flexibility for the businesses that choose to adopt BPO solutions.
Myth 1: BPO is limited to handling low-skilled tasks
A prevalent misconception about BPO is that it is suitable only for low-skilled and labour-intensive tasks, which begs the question: can BPO effectively support complex and knowledge-intensive processes that require specialised skills? The answer is a resounding yes. Reputable BPO providers have experience in handling a wide range of processes, including intricate and high-value tasks. BPO is intended not only to streamline routine operations but also to provide access to specialised skills and expertise to reengineer and optimise processes that businesses might not afford in-house.
Myth 2: BPO is only suitable for large companies
It is essential to acknowledge that BPO partnerships are client-dependent, and the size of the organisation doesn’t necessarily limit the scope of BPO services. If the emphasis is on finding the most appropriate solution rather than adhering to a one-size-fits-all approach, the reality is that any business, regardless of its size, can effectively use BPO services as solutions are tailored to each business’s unique needs and budget. The misconception that BPO is exclusively for large enterprises is debunked by the fact that the BPO model is scalable to the needs and budgets of each business. Small companies can find significant opportunities for growth by partnering with a BPO, gaining access to resources and specialised skills that they might not have access to under other circumstances.
Myth 3: cost cutting is the only reason for BPO
While cost-cutting is often associated with BPO, it is not the sole purpose of effective BPO solutions. The reduction of operational costs is usually because of BPO activities that aim to improve efficiency, implement advanced technology, enhance flexibility, and mitigate risks. The focus is always on increasing business profitability and achieving strategic goals. Accordingly, simply opting for the lowest possible cost in BPO might lead to suboptimal results, and a more strategic approach is one that prioritises productivity, efficiency, and overall business growth.
Myth 4: BPO is exclusively for customer service
Another misconception is that BPO is suitable only for customer service functions. Call centres are a common stereotypical application, but BPO services extend far beyond customer support. Businesses can outsource a multitude of processes, including HR services, payroll, management services, warehousing, distribution, and supply chain operations. BPO provides a strategic partnership through which various non-core business functions can be outsourced to enhance overall efficiency and effectiveness.
Myth 5: BPO is restricted to offshore locations
While offshore locations are commonly associated with BPO, the location of BPO services will depend on the nature of the processes being outsourced. Offshoring may be suitable for customer service functions, but onshoring or nearshoring is often required for labour-intensive non-core functions that require hands-on management. The choice of location should align with the business objectives and unique requirements.
Overcoming misconceptions and embracing BPO for growth
To overcome common misconceptions about BPO, businesses must be willing to embrace innovation, remain open-minded, and explore potential solutions that are possible through engaging with BPO companies. Strategic BPO partnerships provide valuable opportunities for businesses to collaborate within the broader scope of their value ecosystem. Businesses must acknowledge that BPO is not a one-size-fits-all approach. Tailoring a solution to their specific needs enhances operational excellence, provides access to specialised skills, and boosts overall competitiveness in the market.
By dispelling lingering misconceptions through a proper appreciation of the diverse applications of BPO, businesses of all sizes can adopt the correct mindset that will allow them to harness its benefits to streamline operations and achieve strategic goals for sustainable growth.