A report by Shared Services and Outsourcing Network (SSON), an online network delivering the latest news on business and leadership, stated that Fortune 500 companies lose an estimated $480 billion due to ineffective back-office processes. Factors that contribute to this include the following:
- Leadership challenges faced by businesses
- Handling the ever-increasing workload
- Achieving service goals and timelines
Moreover, establishing back-office functions can be costly due to facilities, tools, and expenses on technological resources.
Over the years, back-office outsourcing in the Philippines has strengthened, particularly in the call center industry. In 2019 alone, business process outsourcing (BPO) companies hired more than 1.2 million workers. Moreover, despite the ongoing pandemic, the BPO industry in the country remains resilient.
Outsourcing back-office tasks has been the solution to inefficiencies in larger companies. Even small to mid-sized businesses can now enjoy the advantages of outsourcing.
For businesses to reap the benefits of outsourcing back-office functions, they must first know the benefits that it can bring and see how these can fit their company.
What are the advantages of back-office outsourcing?
Businesses that outsource find a significant difference in the time and resources saved through back-office outsourcing. Back-office needs may vary according to the size and industry of an organization. Still, several benefits of outsourcing common to every company are available, such as:
Time and Cost-Efficiency. As mentioned earlier, back-office functions can be quite costly due to overhead expenses for facilities, tools, and technological resources (software, applications, and programs). Such costs can put quite a strain on the growth of a company.
With outsourcing, back-office operations can be both time and cost-efficient. Outsourcing companies provide the facilities, equipment (such as computers, accessories, and internet providers), and the hiring process (i.e., training). That being said, businesses can save valuable resources as opposed to having an internal back-office.
Access to Experts. Back-office outsourcing gives access to highly-skilled people equipped to provide quality services while using the most up-to-date technological resources. Offshore personnel know how to utilize the necessary tools needed in the industry they work in. This is possible because outsourcing service providers tend to hire qualified people for specific roles, and then provide extensive in-house training and seminars.
Focus. Outsourcing back-office functions allows companies to focus on their core competencies. While the management concentrates on the main areas of the business, their outsourcing partner focuses on the back-office support they need.
Scalability. Once a company grows, the outsourcing vendor will handle the hiring and training process for back-office operations. Moreover, partnering with an outsourcing company can only be contractual, so a company can hire them as needed.
Besides these benefits, back-office outsourcing becomes more enticing when outsourced in the Philippines. As mentioned, the Philippines is known for having a prosperous BPO industry, even during crises. Several statistics show that the Philippines has had the largest market share in offshore customer service since 2013, making it an ideal option for businesses to outsource some of their services.
What are the most outsourced back-office functions?
With the appealing benefits of offshore back-office services, several back-office functions are undeniably grabbing their chance to experience the benefits of outsourcing.
Below are the usual outsourced back-office roles in a company:
1. Data Entry. This role entails obtaining data stored in a particular medium and entering that data into a computer system through a data entry interface in another specific medium. In simple terms, it implies copy-pasting data from the source to the target system. The tricky part happens when data has to be researched, classified, or needs interpretation or the application of business rules before registering into a system.
By outsourcing the data entry tasks, companies enhance work efficiency and productivity by focusing on business management instead of tedious data entry duties.
2. Payroll. In payroll, calculation errors are usually caused by having a lack of expertise in the payroll practice. Also, when lacking concentration, the staff is prone to make mistakes.
One of the advantages of outsourcing is focusing on a specific job required by the client. Also, proper training is given to the offshore staff to gain better expertise and skills. When payroll activities are outsourced, businesses can avoid payroll tax and, at the same time, prevent human error. This factor gives a guarantee of a correct and on-time salary to employees.
3. Human resource. Outsourcing human resource services helps companies organize their recruitment processes, strengthen their workforce, and boost employee satisfaction and retention. Also, it aids in generating a better human resource approach and establishes systems and workflows. All these perks are feasible as outsourcing contributes further expertise and access to more advanced technology.
4. IT support. IT support is one of the most critical functions in any company and one of the broadest outsourcing areas. It is essential since the team deals with queries or issues from customers in a professional manner.
Outsourcing IT support will lead a company to the most up-to-date technological tools. Also, it provides remote assistance that can be challenging for a small business to run. Other advantages are access to cost-effective storage, high-level security, and contingency plan services.
5. Marketing. A startup, small business, or a conglomerate all know the value of marketing their brand. However, doing so is time-consuming.
An outsourced marketing team will strategize and execute marketing plans across all channels, while giving the business an opportunity to concentrate on their main functions. Moreover, businesses can rest assured, knowing that their marketing strategies and implementation are produced by experts.
The decision to outsource back-office functions is crucial to lighten the in-house team’s workload and set sights on the more critical aspects of the business. However, the advantages are not the only factors to consider when outsourcing. Companies must also know how to choose the back-office solutions that work for them.
What are the keys to choosing back-office solutions that work?
It is essential to be clear and practical about your goals and what you want to accomplish with an outsourcing partner.
With the numerous outsourced service providers that give various proposals in the market, the tips below will help you decide who you should choose as your partner, and which solutions work for you.
- Research. Seek out an outsourcing partner who shares the same values and aligns well with your company culture and expectations.
It is also vital to look for a service provider that meets your needs and exceeds your expectations. Ensure that cost-efficiency is not their only feature but also high-quality service.
Furthermore, find a partner who specializes in your profession and has an outstanding client record.
- Do the math. How much will you save in outsourcing versus building the facilities and providing for the service in-house? Experienced and reliable outsourcing partners can break down the costs to assess if you are getting the best price. A successful business is one that prioritizes both quality and savings.
- Think ahead. Prepare for expansion and check if your service provider can keep pace. Flexibility and agility are the keys to scale up a business. Outline your needs and the types of services you might want to extend as you expand your business.
Overall, your outsourcing partner should understand your primary goals, efficiently achieve them, and revisit them regularly. You need to check if they are meeting your project milestones or if there are areas that need improvement.
What is my next step?
Outsourcing offers promising opportunities to businesses as it helps them save resources while ensuring excellent performance and results. Back-office services such as data entry, payroll, human resources, IT support, and marketing are the most common outsourced tasks by organizations that have experienced the benefits of working with a third-party vendor. However, succeeding by outsourcing would also require researching on the record of your service provider, considering your budget, and contemplating long-term schemes.
If you want to begin your outsourcing journey, SuperStaff is here to help you start and even win big.
At SuperStaff, we do not just focus on making things more cost-effective. We also value high-quality work, partnership, and success.
People tend to see back-office roles as insignificant in an organization. But when you entrust these services to us, we give our best by giving the work to the experts while using the latest tools for the job. Plus, our offshore office is in the Philippines, providing access to a wider pool of talents than any other country in the world.
SuperStaff offers specialization in the following back-office support services:
- Fraud prevention
- Content moderation
- Content creation
- Data entry
- Claim processing
SuperStaff offers several outsourcing solutions for different businesses and industries. Click here to discover what we can offer.