BPO is a business practice in which one organization hires a third-party company for their essential business projects for perfect execution. The most common outsourced business functions are customer support, back-office, payroll, data entry, market research, and many more. However, the major reasons to contact the external service provider are lower cost, minimal consuming time, and even focusing on core aspects of the business.
Different Types Of BPO
The following are the 5 BPO (Business Process Outsourcing) types that you should know:
1. Front-Office BPO
Front-office BPO companies mainly opt for the perfect execution of top-to-toe customer-facing operations such as tech support, customer service, sales, and marketing. People in these kinds of roles play a pivotal role in generating revenue and increasing customer engagement. Therefore, excellent communication skills and in-depth product/service knowledge are a must.
For example, salespeople communicate with potential clients and make sure that they share all the product/service-related information in a way that results in successful deals.
Similarly, support representatives handle queries aptly to ensure long-lasting relationships with customers. By joining hands with a reputed BPO company, concerns related to quality automatically get eliminated because deft agents are present to handle any kind of situation, making sure that CSAT never drops.
The benefits of front-office BPO are:
- Reduce certain expenses
- Make a solid strategy to highlight your business all around the world
- Frequently create new avenues
- Top-of-the-world job function
- An increasing rate of service delivery
- Face-to-face interactions anytime
2. Back Office BPO
Back-Office is a type of BPO, meaning third-party companies handle non-customer-facing or administrative tasks for their clients.
It is worth noting that the front-office team relies on the back-office one to carry out operations smoothly. For example, your customer support team (front-office department) will be able to handle payment-related queries properly if your finance team (back-office department) is having complete control over the money flow.
Back-office functions contain:
- Inbound & Outbound call center
- Payroll and Accounting services
- Quality Assurance
- Data entry and data processing
- HR & IT Functions
- Administration
- Software/Web Development
- Software Testing
Benefits of back-office BPO:
- Intensive Research, data entry
- Financial Analysis, auditing, and reporting
- Case management
- Software development and quality engineering
- Keep monitoring remotely and manage essentials
3. Nearshore BPO
Nearshore BPO is the process of outsourcing to vendors located in geographically closer countries. For example, if you are in the US, consider Canada, Mexico, or Central America.
Keep in mind that nearshore BPO and offshore BPO are not the same, although both mean outsourcing to a foreign country. In the offshore BPO, you choose a third-party company that is farther away from your country. On the contrary, nearshore BPO is all about contacting companies located close to your residing country.
Companies don’t mind availing of nearshore BPO services, especially when specialized skills are available at a reasonable rate in a nearby nation.
4. Onshore/Domestic BPO
Onshore BPO is the process of conducting and availing services from a vendor that belongs to your country. Generally, medium-sized businesses prefer to get the services of a local firm to save money and avoid issues related to time differences.
The best part about onshore BPO is that you can communicate with your partner in a native language, which dwindles the possibility of misunderstandings. Also, the time difference won’t be there, enabling you to share your feedback in real-time.
The primary benefits of domestic outsourcing are:
- Easy-to-communicate
- High-cost savings
- Access to the best software engineers and creative professionals
- No cultural differences
5. Offshore BPO
Offshore is a type of BPO, meaning a third-party company from a different country conducts IT operations for its clients. Simply put, it’s the opposite of offshore BPO. Such BPO companies provide world-class software development services at a low rate.
The most preferred offshore destinations are India, Malaysia, and the Philippines. Businesses mainly opt for offshore BPO because they want to access a wider talent pool at a nominal cost. This practice allows them to ensure high-quality work without going out of their budget.
The primary benefits of offshore outsourcing are:
- Reduce labor costs (Typically, you can save 60%-80%)
- Extremely qualified and immensely proficient offshore staff
- Quick-Accessibility to the latest technology
- Highly effective in growing business needs in a very short time frame
What are the Advantages of BPO?
Some of the key advantages of BPO include:
- Reduced Costs: BPO can save companies a significant amount of money on certain tasks and projects, as compared to traditional methods.
- Increased Efficiency: Because BPO services are delivered by a remote workforce, companies can be more efficient in their operations and use fewer resources overall.
- Improved Customer Service: When done correctly, BPO can improve customer service by providing a wider variety of services at lower costs than would be possible if these tasks were handled in-house.
- Greater Flexibility: With BPO, businesses can take advantage of a wide range of flexible staffing options that allow for customization and flexibility in the delivery of services.
What are the Disadvantages of BPO?
There are a few key disadvantages associated with outsourcing business processes. First, the quality of the work can be inconsistent. Second, it can be difficult to track and manage the process. And finally, it can be expensive to outsource a process.
Final Words
All the above information is meant to help you understand what a BPO is and its various types. We would like to underline the fact that businesses of all sizes outsource business operations to increase efficiency and flexibility. As a result, the BPO industry is rapidly expanding.
Since everything about BPO is adequately explained, we would like to know your opinion on it in the comment box. You might hesitate to trust some other company to handle your business tasks, but believe us, it will do wonders only if you join hands with the right partner.
