Does BPO Help the Businesses or Not | Optimus Fox

Does BPO Help the Businesses or Not?

Posted On  April 9, 2020 in  

by OptimusFox

Does BPO Help the Businesses or Not

The first question that strikes the mind is that what does BPO stand for? It stands for business process outsourcing. It is a collection of services which include payroll, human resource, call center, billing, tech support, accounting and customer care relationship services. The BPO companies offer services of multiple domains. These services are carried out by a third party provider for any company. There are many advantages and disadvantages of using BPO services. This article focuses on both the pros and cons of using them, how the business can benefit from using these services and how BPO helps the company to save costs and gain maximum profit.

What is BPO?

Business process outsourcing or BPO is a business practice in which one organization hires another to carry out a task that the hiring organization wants to accomplish for its own business for successful operation. The BPO services can be technical or non-technical. It entirely depends on the mode of business. For instance, if a company wants a call center solution for its business, it can outsource it at a lesser cost rather than implementing its own costly set up. Moreover, support functions for the organizations such as HR functions can also be taken as BPO solutions.

From small scale business to large enterprise sectors, companies outsource many functions. It also helps people to use their skills abroad. For example, if a company is situated in the US, it can have a call center outsourced in any other country. Companies outsource many functions to reduce labor and maintenance costs thereby avoiding overheads.

Why Businesses Need BPO Companies?

There are several reasons why businesses opt for BPO companies to work for them. Some of them are discussed as under:

1. Cost Reduction

Outsourcing decreases the cost of operations. When a company hires people, it needs to train them too. These costs are automatically cut down. The local employees need to be paid fixed salaries. On the contrary, outsource projects have service oriented payment plans.

2. Focus on Core Functions

Every business owner knows what its major functions are. These functions can never be ignored. Therefore, businesses outsource different processes to focus on their main functions. It helps the company to grow gradually. If it focuses on making profit and increasing sales, the company can definitely grow by outsourcing other less important functions.

3. Flexibility in Business

If the company is not busy with less important functions, it can focus on making new products. BPO meaning can be clearly understood when functions are outsourced. The internal resources can be designated to core responsibilities in order to achieve the heights of success. As a result, the flexible environment results in growth.

4. Efficient Workflow

There is another advantage associated with the BPO services. The efficiency is improved overall. For instance, a company has outsourced the payroll operations to a specialized company, it needs not to worry about the payment operations. The specialized companies will handle the payroll process efficiently.

Risks of Business Process Outsourcing (BPO)

There are also some risks associated with BPO solutions. Some of them are:

1. Security

When the outsourced functions involve the information systems, there are risks associated to security. The data of any company is confidential. Nobody wants to disclose the private data. The hackers can always put the data at a higher risk. Potential breaches are the threat to any company.

2. Increased Dependence on Service Providers

The BPO companies become a significant part of the company’s business process. They act as vendors for those who hire them. When a vendor faces any problem in the workflow, the entire business process suffers. It results in the dependence of the service provider because the vendor has to solve the problem of its end. The increased dependence results in delays and halts in smooth operations.

3. Barriers of Communication

If the company outsources any functions across the globe, there is a chance of communication gap due to language barrier. It may result in the delays of the processes. Eventually, the business processes have a chance of getting disrupted by the hurdles of communication.

The Road Ahead

Discussing the future of the BPO, the inculcation of automation in the processes will be seen.

  • Machine learning, cloud services and social media are the emerging technologies that will be changed by business process outsourcing for decreasing costs.
  • The future lies in automating the procedures for all the industries.
  • The outsourcing companies that deal with accounting procedures will automate with state of the art software solutions.
  • The call center support providers will move towards artificial intelligence for their technological growth.
  • The payroll management providers will optimize their processes for smooth implementation of processes.
  • The marketing oriented BPO service providers will also use the cutting edge technology to cope up with the latest technological trends.


The businesses are constantly getting dependent on BPO companies. The gaps of the organization are filled by such service providers, so there is a need to develop mutual trust between the companies and the vendors. The globe is moving towards such organizations where most of the work is automated, thus the need to build the trust is important. With automated business processes, the tools should be used to improve communication, reduce the risks and increase accountability. If there is an offshore company that is providing the BPO solutions, the trust should be ensured by accountability and transparent reporting. The businesses depend on each other, clear descriptions of the modes of business and ensuring accountability will enable both the company and the vendor to grow together.