The Benefits and Risks of Business Process Outsourcing

Businesses now outsource many of their non-core processes to survive rising costs and difficult economic conditions. Outsourcing companies provide high quality, competitively priced back office solutions for a wide range of operations - from data entry and document management to medical and legal transcription, medical billing and coding, and much more. However, business process outsourcing comes with both benefits and risks. Read on to get an idea of both sides of the picture.

Outsourcing Help Businesses Face Global Competition

The latest trends in outsourcing say that businesses are looking beyond the cost advantage. They want innovative solutions that will help them get an edge over their competitors, and business process outsourcing companies are going all out to provide that. A list of the many gains that outsourcing offers:

• Infrastructure cost savings: The buyer would not have to set up the infrastructure necessary for back office operations. The BPO company is usually specialized in a wide range of tasks and would have the resources, technology and manpower to offer professional services. This offers the buyer a high degree of flexibility.

• Increased productivity: Internal resources and personnel can be directed to core tasks. Administrative burdens are eased and valuable time saved. The focus is on increasing productivity and revenue.

• A paperless office: Electronic documentation paves the way for a space-saving, efficient, paperless office. Official records and important documents are easily retrievable with document conversion and document scanning solutions.

• Innovative solutions: As mentioned earlier, reliable service providers are geared towards providing their clients with innovative solutions. They are equipped with the latest technology and a skilled workforce that can provide customized solutions to take your business to the next level.

• Competitive pricing: Am established service provider can offer competitively priced BPO services to save their clients up to 40 percent on overhead.

The Risks of Outsourcing

• Security: Breach of security is one of the most important risks of outsourcing. The client allows the BPO company access to its valuable data. Misuse of the data and network access privileges is therefore one of the most important risks that the client faces. This can have serious legal consequences for clients in health care industry where patient confidentiality is crucial.

• Intellectual property risks: Client companies face the risk of theft of their source code and confidential design documents of a key product to which the vendor has access.

• Vendor organizational risks: If the business process outsourcing company faces internal organizational issues, this could affect the client company too. Operations may get stalled and services would not be delivered on time.

How to Get the Best out of BPO

Given that business processing outsourcing has both benefits and risks, both clients and service providers should look to mitigate them. Clients should take care to partner with an established company that can provide safe and effective solutions. Checking out the track record of the vendor company is important. The BPO company should have every measure in place to ensure the confidentiality and security of client information.

Offshore Business Process Outsourcing - New Opportunity To Save On Costs

The necessity to look for ways of reducing costs for various financial services is now higher than ever. Nowadays, the global market today is constantly changing and growing, that is why every business seeks to increase productivity. Banks, insurance offices and capital markets are urgently searching for ways to quickly reduce costs without losing the quality of their services, therefore many are thinking of hiring the offshore business process outsourcing, which can help not to lag behind the times and retain competitiveness. The non-core but still important processes which take up a lot of time are better to be outsourced to offshore business process companies, which are often viewed as more flexible, quicker, less expensive and more productive.

Taking into consideration that a great number of employees at offshore business process outsourcing centers are a better educated in highly specialized fields labor force, which constantly upgrades according to the needs of the time, as well as the possibility of using the world-class telecommunications, the typical services bought offshore can become an improvement in the quality and level of services, offered by your company.

Offshore business process outsourcing companies are normally situated in the in the countries with low average-sized wages, such as India, the Philippines, Brazil, Russia, the Czech Republic, and China. The companies may provide instant cost saving possibilities, which are available because of the great number of competing businesses, often without the need to make serious initial investments. For the businesses striving to decrease their production costs the variant of employing offshore business process outsourcing is one of the best options on the way to achieving savings, taking into account that nearly every firm has at least one area or task, which can be successfully outsourced. The most common examples of offshore business process outsourcing include such spheres as call centers, human resources, accounting and payroll outsourcing, mortgage processing, financial analysis, accounting, legal research, paralegal services, legal transcriptions, insurance claims processing, market and competition analysis, product launch, publishing services, patents , storage, lease management, lease abstraction, real estate management and several other services.

The clients who finally decide to employ offshore business process outsourcing can often get almost complete control of the policies, workflow processes, reporting, systems and data with the help of the modern means of information. Some of the businesses buy or develop their own Internet-based project management tools, allowing the real-time control of all your offshore tasks. This actually destroys the assumption that it nearly impossible to control the work of offshore business process outsourcing centers due to their distant location and time difference.