Business Process Outsourcing

Business process outsourcing allows the owner of the company to dedicate his company's resources to focus on the mission-critical activities.

The owner of a company has detailed process plans to take care of all the mission-critical activities of the company. To aid the effective execution of these process plans, he would require resources to take care of the non-critical aspects of the company. Business process outsourcing allows the owner of the company to dedicate his company's resources to focus on the mission-critical activities.

It all starts from the company deciding to choose a 3rd party company which will do some of its functions which do not impact the company's standings in the market directly. Once the company decides which functions it needs to outsource, it could select the 3rd party company either in its own country or in a country across the waters. If a company chooses the 3rd party business process outsourcing company in the same country, it is called onshore outsourcing and should it wish to go abroad for its work, it is called offshore outsourcing. Both have its own merits and demerits, but offshore outsourcing provides its own set of advantages, cost-effectiveness being the one big plus point.

The most important domains of business process outsourcing which companies in the US have chosen to outsource are as follows:

  • Call Centers - These are workplaces which handle incoming calls related to inquiry of a product or customer service. Outgoing projects like Telemarketing, 3rd Party collections also form a part of a Call Centers work portfolio.

  • Human Resources - The fact that every company needs people to make it succeed ensures that Human Resources is a critical component of every organization. With an eye on minimizing the financial risk on the company due to its workforce, Human Resource management deals with a wide range of functions like Hiring, Performance Evaluations and Planning.

  • Accounting - Every company with some bottom-lines and sales to go with it, has to have financial activities. The practice of interpreting and maintaining records of these financial activities is called Accounting. Some of these activities like maintaining the balance sheets of a company are extremely confidential and sensitive, some like cross-checking of records, maintaining invoices are not so critical to the company's accounting standards.

  • Payroll - In simple terms, payroll financially explains the system of your monthly pay. Your monthly pay is a break up of your salary, bonus and deductions. Payroll is a summation of all the employees' pay records.

As you can see there is a good mix of low-end processes like call centers to niche services like Accounting and Payroll which dot the business process outsourcing radar.

Business process outsourcing management is all about managing metrics, quality and data confidentiality. So long as a company can integrate these three into their project management plans, the outsourcing contract for sure will be a success.