IPS Blog

BPO is Not a Four Letter Word

Jun 9, 2016 11:21:12 AM

By: Greg Bartels, President & CEO

Business Process Outsourcing (BPO) track record has a history of mixed results. In many cases, BPO has left CFO’s and other C-Level executives with little to show for their efforts.

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In all actuality though, as you might have discovered from our previous blog, BPO is an essential piece of the puzzle for increasing your businesses productivity and even improving the culture of your workplace.

Unfortunately, current political rhetoric and poorly executed and/or misguided BPO projects have set a bad example for what these services can actually achieve.

 

How Bad Business Process Outsourcing Has Burned Businesses in the Past

It doesn’t take much effort to search around the Internet and read about poor business process outsourcing experiences. According to HRZone, 40% of global organizations are dissatisfied with their BPO services and switch to a new one within 1 year.

The amount of time and effort that most companies invest in onboarding a BPO partner gives me heartburn just by thinking about it - let alone the money that these companies put at risk. While some financial risk for the onboarding task is unavoidable, in today’s market your BPO partner should have the industry and application knowledge to limit the amount of time and money required for a BPO integration.

Offshore Solutions are no Substitute to Strategic BPO

The terms offshore and outsourcing are often used interchangeably; however it’s important to know that they are not one in the same. I recently heard a politician attack BPO with the same protectionist rhetoric as others do offshoring. BPO is not offshoring and offshoring is not BPO! According to the latest studies the US BPO market is a US$135 billion market and will grow to US$200 billion by 2020. 

Offshoring is often confused with outsourcing and can be an extremely ineffective BPO solution for your business for several reasons:

  • When you lift & drop something (your business process, for example), guess what happens? It usually breaks.

  • Many offshoring companies simply do not adequately automate business process and substitute low cost labor for real productivity improvements.

  • Offshore business models are focused on ever increasing labor pools. Many Offshore companies have limited knowledge of US business processes, technology and practices. This often goes hand-in-hand with haphazard technology integrations.

  • Offshore sales strategies focus on the promise of lower cost per employee or FTE and rarely focus on reducing the total cost of the business process including technology.

  • Offshoring also brings in different cultures, languages, and dialects that break the critical connection between your company and your provider. If you cannot communicate due to language barriers, your BPO strategy will suffer.

 Integrating a BPO Service

Strategic BPO is about adding value to your business with a more effective business process, not replacing it with lower cost labor. Successful BPO is all about people, process, and technology. IPS implements your long-term strategic plans and integrates quality, labor and innovative technology. This is the key to strategic business process outsourcing and digital transformation. The reason why IPS takes a strategic approach is simple: it makes your business better. BPO is a simple, yet powerful tool that cannot be replaced with offshoring alone.

5 Ways to Stay in your Lane on the Business Process Outsourcing Highway

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IPS has been in the business process automation industry for 25 years and deeply understands how to help your business achieve the best outcomes with BPO. IPS has revolutionized the way that companies outsource their business processes—and does so with an innovative and strategic approach.

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Topics: AP Processing, Digitizing Business, Invoice Processing, BPO, Business Process Outsourcing