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The Cardinal Rules of Effective and Successful Outsourcing

The-Cardinal-Rules-of-Effective-and-Successful-Outsourcing

Is it possible for both small and big businesses to benefit from engaging the services of a business process outsourcing (BPO) partner? YES! The benefits, as we know, are obvious — reduced labor expenses, greater efficiency, and access to professional experience among others. However, statistics reveal that six out of ten partnerships (which include offshore outsourcing) fail.

Why is this so?
Why many outsourcing partnerships fail

Unfortunately, not all partnerships are successful. And we know why. The most common cause of outsourcing partnership failures occur with low-cost outsourcing companies.

The reasons are palpable. Saving on cost means having to cut down on overhead costs, salaries, rent, infrastructure, and worse, security systems. And when organizations cut down on costs, the first to go are work-life balance incentives. Inevitably this leads to burnout, poor engagement with clients, and higher attrition rates. Training and recruitment will eventually take the brunt, as well.

Outsourcing rules

Here’s what to keep in mind when engaging an outsourcing partner.

The first rule of business process outsourcing is to know and understand your needs at all times. A lot of people who engage in outsourcing services aren’t aware of what they’re getting into. Have well-defined needs and goals from the get-go. Everyone should be on the same page. It is the responsibility of a reliable BPO to verify with their clients if their outsourcing objectives are attainable. Clients need to have a clear idea what they want to achieve with the BPO. Establishing this with more clarity will reduce the likelihood that it will become a problem down the road. The service agreement between the business process outsourcing (BPO) and the customer MUST contain all the key requirements.

Second, delivering exceptional Customer Experience (CX) and high-quality service should also be your top priorities. Guaranteed savings are 30-50% with any offshore outsourcing plan that is carried out with precision by a top BPO provider. When compared to onshore vendor rates, working with a low-cost BPO provider that can offer savings of 60-70% usually only increases the chance of failure tenfold. This is because they can’t afford to spend their resources on infrastructure that will provide high-quality service or outstanding customer experience (CX).
Low-cost BPOs compete only on price rather than quality. At NEARSOL, improving customer experience is the main goal of business process outsourcing. Cost reductions are pointless if this is lowered only for consumers to suffer from poor service.

Third, establishing a partnership with an outsourcing provider (with the appropriate capacities) is crucial. To illustrate, a large-scale vendor with thousands of seats and agents isn’t going to be able to match the kind of care and attention that a smaller, boutique-type BPO can provide to SMEs with lesser outsourced needs (2-50 agents). A good rule of thumb for an outsourced program is to use 3–10% of the BPO vendor’s total available seats. Doing so will guarantee that the outsourcing provider regards your company as an important account.
The Philippines is home to about a thousand business process outsourcing (BPO) firms, so clients may choose from a wide range of specialized industries and services. Collaborating with a BPO, such as NEARSOL, that has extensive knowledge in your program area is the third most important element necessary for a successful and lasting outsourcing collaboration. Consider outsourcing only front-and back-office duties if the BPO is better than what you could accomplish in-house. You may also want to reevaluate how you choose your outsourcing partner if that isn’t the case. The key to a successful outsourcing collaboration in the long run is finding and collaborating with a specialist BPO.

Last, but certainly not least, choose a business process outsourcing (BPO) company that uses cutting-edge technology. Top business process outsourcing (BPO) firms in the Philippines are technology-focused. This is crucial since it determines whether the outsourcing program’s success. To their ruin, the vast majority of small and medium enterprises fail to notice this crucial aspect. Enhanced operational efficiency and customer experience (CX) are possible outcomes of technologies like AI and cutting-edge security systems. Using state-of-the-art technology, a BPO might minimize expenses by reducing the number of agents needed compared to a provider without such technology. Customer happiness and net promoter scores go up when CX is up.

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NEARSOL is a US-based BPO and service company that offers clients custom-design solutions.  With major hubs in Manila and Iloilo, it began operations in 2011 and has since gained a strong presence in the Latin American regions, the Caribbean, and the Asia Pacific, winning many awards for quality and service along the way. Most recent of which is its Great Place to Work-Certified™ Recognition, a global accreditation that tells stakeholders what employees think of the company culture.

Visit our LinkedIn to learn more about our company and our global footprint.

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