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Business Process Outsourcing: What and Why?

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Business Process Outsourcing is a method of sub contracting some parts of the operations to a third party. BPO was originally associated with manufacturing sector but later it was totally embedded as Information Technology Enabled Services. Outsourcing helps companies to stay focused on important business areas. It also helps them to use their management resources effectively. In the present situation companies face many challenges like tough economy, lack of skilled resources, lack of time to pay more attention to marketing and customer services. It has become necessary for companies to have a flexible pricing, process and technology to be successful. To sustain profitability and to access talented resources many companies go multinational to stay ahead of their competition. It is essential for the companies to sustain their deliveries consistently with competitive advantage utilizing latest technologies.

Some services outsourced are:

  • Human Resources Management / Recruitment
  • Payroll Processing
  • Insurance Claims Processing / Adjudication
  • Medical Transcription
  • Medical Coding
  • Medical Billing
  • Litigation Support Services
  • Medico Legal Services
  • E-publishing
  • Data Conversion
  • Customer Support Services
  • Telemarketing (Sales)
  • Technical Support Services
  • Procurement and Supply Chain Management
  • Employee Training
  • Banking and Financial Services

Business process outsourcing brings in many advantages to the companies. Some of them are listed below:

Scalability: Business is outsourced to vendors, who have the expertise and equipment required to perform the task consistently. In business sometimes we sign up with big clients who look for companies to deliver the projects immediately. Outsourced vendors have the ability to assign manpower to the deliver the projects immediately.

Cost Savings: Outsourcing does save about 30% as the recruiting, retaining, managing costs are totally erased. Outsourcing companies do not need to worry about training, retraining and managing staff. All the responsibilities are moved to the vendor. No loaded expenses, benefits and related taxes. Save big on software, hardware and maintenance cost.

Skilled Resources: Employing and deploying skilled resources to client’s requirements is absolutely critical for any business survival. Outsourcing provides instant access to skilled resources. Outsourcing companies select their vendor based on various criteria to ensure that the project is delivered with high quality and consistency.

Access Latest Technology: Experienced vendors usually make huge investments on latest software and hardware required to run the business efficiently. By outsourcing, companies get access to these latest technologies without making any investments.

Quick Turnaround Time: By outsourcing to professionals, projects are delivered on schedule. A quick daily turnaround is provided on specific tasks and tracking of logs are well maintained. Daily productivity metrics and quality assessing checklist are followed strictly to ensure seamless operations.

Focus: Companies can stay focused on their core activity and spend more time/money on acquiring new business. Outsourcing saves money, which can be invested in various other areas resulting in the growth of the organization.

Reduce Compliance Risk: Certified professionals ensure to deliver all the work accurately. This helps to reduce compliance risk considerably and increase revenues. Outsourcing increases accuracy and also helps to stay ahead of the latest changes in the industry.