Business Process Outsourcing and Its Needs

BPO or Business Process Outsourcing is the worldwide phenomenon hitting Australia right now.

BPO is the process of hiring third parties to provide non core administrative type services, for a contracted fixed duration and for a agreed price.

Generally the outsourced services fall may include finance, accounting, human resources, Information Technology, typing, personal assisting, sales administration and training.

Business Process Outsourcing Services allows businesses to concentrate on their core activities thus increasing their turnover at a reduced operating cost and with less management time.

The fee charged, may be either fixed thorough out the contract period or variable based on the services provided or a combination of both.

Another major drawback can be security issues. When the provider of the BPO services is not maintaining adequate security measures, as it claims, sensitive data is at risk. When issues arise, we tend to lose the goodwill of the our customers, thus losing the core business. So choosing the activities for outsourcing and internal process is a major key for success for outsourcing firm. Service level expectancies may fail, contractual issues may not be clear, charges may be more than projected, dependencies on the BPO services increases, thus ceasing the flexibility of internal process.

The outsourcing of subsidiary services provides the firm with more options for expansion, as capital and resources are freed, allowing more opportunities for further growth. As more resources, time and capital are freed from non-core or administrative activities, the speed of business process increases, thus improving client, customer and staff satisfaction, which is a key for business success.

Why Business Processes Are Inefficient

Last week I was watching the classic movie "Office Space". I love the line where he owns up and tells the consultants "I'd say in a given week I probably only do about fifteen minutes of real, actual, work."

Now, my personal belief is that most people put in more effort than that at work but I'd be very skeptical if the general population works a full 7 hour day. Granted they might be there for 7 or more, but are they really working and producing something of value?

Part of my role as a business consultant is to review operational processes and cut or modify unnecessary steps that consume time and therefore dollars, but don't add value. I've worked on countless projects where I've asked an employee why they perform certain steps in a process and received the response "That's the way I was trained to do it when I started".

In fact, I'd boldly state that this is likely the number 1 reason inefficiency creeps into business processes. Over time systems, requirements and staffing changes, but instead of reviewing the business process and updating it, process owners simply add in the extra steps to achieve the final result without questioning the validity of existing activities.

If you can find an employee who takes initiative, questions the validity of what they're doing and strives to improve their daily activity in order to feel good about the work they produce, you've found a superstar.

Sadly, many people at some point have tried to create change, but found themselves beaten down by a bureaucratic corporate culture or a boss that couldn't afford the time to listen and "sign off" on proposed changes. Do you remember those days? Is that part of the reason you became an entrepreneur, so you can think for yourself and enjoy your work? To feel like you're producing something of value? And yet, being an entrepreneur brings a bigger challenge. The responsibility and accountability for not just the work you produce for clients, but the way in which you conduct yourself every day and how you spend your time.

Are you busy doing a lot of things but not really getting anywhere? The problem is, unlike the employee performing valueless steps, no one trained you to do that when you started your business. You didn't inherit a system that (albeit includes a few useless steps) produces results overall. No, you started from scratch and created your own systems and methods for getting things done.

So, my question to you is this, are you producing results in the most efficient way possible? Are you going about your business like a pro or an amateur?