Business Process Outsourcing, or BPO, concerns hiring specialized companies to manage activities of great importance to the organization but have no direct connection with its core business, such as accounting, the legal sector or logistics.
The idea behind this concept, translated as Business Process Outsourcing, is to streamline the company and focus as many resources on developing innovative products and services as possible.
On the other side of this relationship is a BPO company with expertise in the outsourced sector. She will not only provide consultancy or implement the orders of the contracting company; her job is to think strategically and, in addition to operational service, support the organization’s growth.
In short, the business that hires the BPO will place a department, partially or entirely, “in the hands” of the contracted company so that it meets the demands established through negotiation between the two parties.
How Does BPO Work?
BPO is based on a fundamental principle: instead of applying resources to select and train professionals and investing in a complete structure for their work, it is better to hire a specialized organization to take care of my needs.
In practice, BPO allows you to take advantage of the knowledge, processes and even technologies of a company that has as its primary business what is secondary for you. In addition to the areas mentioned, it can be applied to HR, document management, customer service, IT, inventory management, etc.
The contracted organization seeks to adapt to the contractor’s routine and ideals, presenting an individual work model that enhances each client’s specific characteristics. In many cases, the connection is so deep that the service provider fully supplies the work of a department.
Depending on the agreement signed between the two parties, the professionals appointed to conduct the BPO in the contracting company may even be part of councils and other deliberative bodies, carrying decision-making weight comparable to the directors of internal departments.
What Is The Difference Between BPO And Outsourcing?
In practice, and even in name, BPO is a form of outsourcing. Still, it has little to do with the traditional model, which many companies already use in maintenance or security.
The most crucial difference is that through BPO, the contracted company becomes a part of the contracting party, influencing strategic decisions, presenting projects and using its expertise in an area to solve problems.
Although the care offered by traditional outsourcing is very important for an organization’s daily life, it does not usually have decisive weight for its success. This weight is typical in Business Process Outsourcing relationships, as the company responsible for the BPO will access its clients’ routines, processes and organizational structure.
As the integration takes place, it is normal for the client company to rebuild a considerable part of its processes to ensure minimal obstacles to the circulation of information and resources necessary for the contractor’s work.
We can summarize these differences by observing the relationship between volume and specialization of the two models: while traditional outsourcing is focused on the first element, meeting demands that do not require significant expertise, BPO delivers specific services with a high level of technical skills.
Four Benefits Of Implementing BPO
For a company to be willing to share data and processes of its internal functioning, the BPO must bring a high return. These four benefits show that the practice lives up to expectations, promoting gains on several fronts:
The most evident reduction occurs in the selection, training and management of human resources, but the economy does not stop there. When hiring the BPO, you will have access to cutting-edge technologies for a fraction of the value, which will be shared with the other clients of the contracted company.
It is also possible that there will be a reduction in expenses in other areas, such as rents, maintenance, transport, and even the energy bill. All these amounts become a single, lower payment to the BPO company.
Improved Focus On Core Business
Focusing energies on the core business allows any company to gain agility, innovation and competitiveness, as its leaders have minimal concerns with managing the sectors managed in the BPO model.
Access To New Features
From highly specialized professionals to the most advanced technologies, a BPO company committed to its clients will deliver high-standard resources, allowing the contracting company to expand its activities while maintaining a lean structure.
The idea is that this access receives constant updates as the BPO company trains its employees, creates new processes and hires or develops even more efficient technological resources.
Working with a partner in the BPO model allows you to have someone who evaluates your company from a different perspective and points out opportunities or risks not identified by the “in-house” team.
This external feedback can also contribute to the elimination of biases when the organization’s managers prioritize ideas, people or resources based on factors that have no connection with the company’s results. This can occur gradually, being naturalized within the business but easily perceived by outsiders.
Opening Of New Doors
The BPO company can point out opportunities and drive partnerships with other of its clients, resulting in an ecosystem that allows all parties to grow and further enhances the benefits discussed above.