In a competitive business environment, having the edge isn’t just about making top-tier products or delivering unrivalled services. It’s also about making shrewd decisions concerning your company’s internal operations. This is where Backoffice Outsourcing comes into play, a strategic move worth considering for your enterprise.
Defining Backoffice Outsourcing
Backoffice outsourcing simply refers to the practice of hiring an external company to handle various noncore activities. These activities range from payroll, human resources and accounting to data entry, customer service, and IT services. For instance, a real-world example could be a shoe manufacturing company outsourcing its IT support team to a specialized IT service provider.
The biggest lure for engaging in backoffice outsourcing is the potential for reduced operational costs. This is confirmed by Deloitte’s 2020 Global Outsourcing Survey showing that 70% of respondents touted cost reduction as a significant factor influencing their decision to outsource.
But cost isn’t the sole motivator; companies are also attracted by the likelihood of handling other core functions more effectively. According to the same Deloitte survey, 40% of companies reported that outsourcing allowed them to focus on their core business.
The idea might be simple, but implementing it effectively is a tad more complicated. Outsourcing noncore functions brings along perceived risks including loss of managerial control, privacy invasion, and service delivery failure. The aim of this article isn’t to dissuade you but rather, to assert through expert quotes and compelling findings that backoffice outsourcing, when done right, is a boon for your business.
Countering Outsourcing Concerns
Former IBM CEO, Lou Gerstner, once asserted, “Not all smart people work for you.” Outsourcing embodies this belief as it gives an opportunity to tap into a wealth of knowledge and expertise outside your business. With a professional outsourcing provider, concerns about loss of managerial control and service delivery failure can be put to rest.
Quality outsourcing companies possess robust management structures, well-defined operational procedures, and high-performance standards comparable, if not superior, to in-house teams. KPMG found that companies becoming more mature in their outsourcing capabilities tend to have higher satisfaction levels with their outsourcing providers.
It’s not just about access to a skilled workforce, outsourcing also affords businesses cost-effective scalability. Take for instance, an e-commerce company experiencing seasonal fluctuations in customer inquiries. Rather than hiring full-time staff who might be underutilized during off-peak periods, they could outsource their customer service to absorb these chaotic demand surges. Economically, this works out more advantageous.
As for potential privacy breaches, reputable outsourcing companies understand the gravity of such concerns and have taken stringent measures to ensure data protection. They employ sophisticated data encryption methods, rigorous access control measures, and regular security audits. Thus, when you choose your outsourcing partner, be rest assured with their experience and authenticity to protect your sensitive data.
Business magnate Richard Branson once said, “Succeeding in business is all about making connections.” Outsourcing is nothing short of a strategic business partnership, serving as an important element in your enterprise’s growth journey. When done right, it allows you to focus on your core competencies, while leaving noncore functions in capable hands. It’s a win-win!
In an ever-evolving business landscape, backoffice outsourcing has emerged as a strategic option for companies seeking to maintain competitiveness and profitability. While apprehensions around outsourcing are valid, with right selection and management of your outsourcing partner, the benefits far outweigh the potential hurdles.
Convert your backoffice into a powerhouse of efficiency, hand your non-core activities to experts, and let your business shine in its core proficiency. Making that brave outsourcing leap can turn out to be the most effective business decision you’ve made yet.
So, will you take that leap of faith? Will you seize this opportunity to drive your business ahead? Remember, a realm conquered is a victory earned!