What is Business Process Outsourcing (BPO)? – Forbes Advisor

The following section provides three examples of business process outsourcing, including payroll, call center customer service, and supply chain management. However, business process outsourcing can help with a long list of business functions, including human resources, marketing, accounts payable (A/P), research and development, and sales, among others.

Payroll

Payroll involves calculating and passing on wages and taxes to workers and government agencies. In short, it starts with a list of employees and their status as contractors or employees. Wages are calculated based on employment status, tax withholdings, paid time off (PTO) and more. Wages are often paid by direct bank transfer and payslips are made available to employees. Records are kept, estimated taxes are paid quarterly and taxes are often filed annually.

It is clear that a lot of time and work goes into processing payroll. It requires not only paying talent, but also hiring experienced payroll staff to carry out day-to-day work and avoid financial risk. Companies can outsource this process to save time, money and resources that can then be devoted to their core competencies. By putting this process in expert hands, companies can also reduce the risk of penalties for payroll errors.

Call Center Customer Service

Call centers often work with customers to ensure they are having the best experience with the company’s services or products. The process involves answering customer questions and assisting in resolving issues related to the company’s products or services. For best results, call center staff should be professional (even with disgruntled customers), knowledgeable, personable, clear-headed, and able to balance meeting customer needs with the interests of the company.

As we live in a 24/7 world, the greatest customer satisfaction is often achieved with a constant presence to support them. Many small businesses don’t have the time, resources, or funds to provide 24/7 customer support. In addition to the constant demand for customer support, many companies don’t have the talent to meet other customer needs such as: B. Multilingual support. Call centers are often equipped with the talent and resources to meet such needs.

supply chain management

Supply chain management controls the process and flow of product manufacture. For example, the manufacturing of shoes requires raw materials, sometimes from multiple sources around the world. Next, the raw materials are sent to the company that makes the shoes. The shoes are then sent to the companies that sell them to customers. Meanwhile, inventories are managed so that resources arrive on time but do not incur additional storage, labor, or other costs.

Supply chain management is a complex process that can cost companies their profit margins if not done accurately. The partners chosen in the supply chain can determine or destroy a company’s legal and moral standing. Management includes legal advice, payment processing, sourcing partners, quality control, accounting procedures, specialty software and more. An experienced BPO firm can manage this complexity while reducing risk.

bottom line

Business process outsourcing is the outsourcing of business functions to an external company. This allows companies to enjoy benefits such as: B. Reduction of overhead costs, access to advanced reporting and innovative technologies, reduction of risk, access to specialized talent and better adaptation to changing customer requirements. However, it must be managed carefully to avoid pitfalls such as siled corporate communications, hidden costs, and reputational damage.

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