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Offshore Business Process Outsourcing – BPO – Right for your Business?

Technology changes business.  Could you run your business without a fax, phone, or electricity?  Imagine your world without plastics. 

Innovations quickly become necessities.  These technologies   dramatically altered work.  The latest is the internet… the most disruptive change since the printing press.  Those who ignore this reality are at a growing competitive disadvantage. 

You are already using computers in your business.  Can you use the computer to outsource your back office…save money; guarantee your growth and success?  Others are!  Buying products made outside of your community isn’t new.  As economies globalize, sourcing became global. 

 Forbes Office Equipment, 102 N 2nd Ave E, is a Konica (Japanese) authorized dealer.  Their web site tag line is “World Class Products Combined with Local Service and Support”.  

 With the internet, you can now buy services overseas too... 

Large companies go offshore for labor intensive administrative activities.  Under the right conditions, economies are available to your business.  Business Process Outsourcing (BPO) can give you what you want, when you want it, cost effectively.

What benefits?  How do you decide?  What are pros and cons… pitfalls and opportunities?

Benefits are lower overhead and direct cost (30-50%), fewer personnel problems, and less turnover.  You access expertise not in your firm, create flexibility for changing workload and free up people for higher value activities. 

Sounds good; what can I outsource? 

Candidates are standard, repetitive back office operations, web research, legacy computer systems, transcription, forms processing and the like.  First, you must know what results you want.  You need an employee who understands exactly is required to train your supplier.  If they lack project experience, they will need guidance.  If the employee changes jobs, you will need a detailed work specification to maintain consistency.  You can outsource part-time work, but quoted rates are higher…your supplier is working part time too.  They look for efficiencies of scale.  The ideal candidate is continuous, documented work involving one or more full time people.  And it must be something that can be transmitted over the net.  Hardcopy may be ok, but there are time and customs considerations.

Once you have identified your candidate operation, what next?  Most BPO suppliers provide a free quote.  Be realistic about volume, fluctuations, turnaround time and deliverables.  These all affect the quote.  Low bid may not be best bid.  Over the long term, supplier relationship is key.  Agree on a fair contract.

To capture BPO savings you must have predictability and reliability of work flow.  Communications must be timely.  Initially, there is the need for phone and e-mail interaction during your business day.  The time difference is about half a day for offshore work in India…the hotbed for this activity.  Why India?  Surprisingly, India has the second largest English speaking population after the USA.  To compensate for the time difference, you need a contact stateside.  They ensure your requirements are understood, communicated and followed.  Demand it and you will get it.  Communication is a two way street.  Be responsive too.

Trust is the most difficult quality to build in any relationship.  Service providers in India value long-term, strategic relationships.  Pick a supplier who has been in business and plans to stay.  They know they will prosper as your business prospers with the competitive edge you have gained by freeing up your valuable people, capital and cash.  Pay invoices on time and the BPO supplier will go through hoops to keep your business and make you successful! 

How do we embrace these inevitable changes and maintain a prosperous work force and economy?  These questions were answered by General Electric, IBM, General Motors… every multinational.  Their response: offer customers high quality, innovative products and service at competitive prices.  They moved activities offshore and provided the customer what they demanded.  Those unable to do that fell by the wayside, victims of shortsighted management paralyzed by the disruptive technology.  The list is long…….US Steel, Hathaway Shirts, the shoe and apparel industry.  The technology is now available for the small business to stay competitive.

Responding, adapting and taking advantage of a disruptive technology is not easy.  Change isn’t easy.  Your commitment to your employees is important to your business success.  With today’s technology some of your best “employees” can be half a world away.  After all, in the final analysis, your commitment to your customer and your ability to serve their needs is what makes your business grow.   

A careful examination of your operations and opportunities offered by Offshore BPO deserves your attention.  Your competitors are doing just that.

Clint Ackerman is CEO of The Network Connection Inc., (978) 863-0123 or  c_ackerman@thenetworkconnection.com.