There’s more than one way to outsource, so you can choose the ideal outsourcing strategy for your business—one that will help you improve customer service to boost satisfaction and fuel exceptional growth. Analyzing the available outsourcing strategies will help you realize that each approach offers a unique value proposition around culture, cost, and operational aspects.
Onshore outsourcing refers to outsourcing in your brand’s homeland and employing labor under the contact center’s payroll. Keeping operations in the same country can be an ideal set up, especially for industry verticals such as services and government organizations, which can avoid cross-border transactions. Customer problems may be solved more easily when a local call center agent is handling interactions. Plus, onshore BPOs are familiar with the culture, language, and may even be using the same products and services as your customers.
Hiring third-party employees in the same country also helps to create new jobs, boosting the economy. Privacy and sensitive data can be handled carefully, especially for financial and government centers. Your outsourcing partner can take over end-to-end management of the entire process, which reduces cost and helps the business focus on new segments. Revenue boosting functions, such as sales, generally prefer onshore because agents are geographically and culturally aligned to customers.
Offshore business process outsourcing
This is when you choose to run your contact center overseas, in a country where agents with similar skills can provide the same service quality while significantly cutting costs. Customer operations are shifted offshore, specifically to lower-cost regions like LATAM and South Asian countries. These regions have established a solid base for contact center operations with the help of a diverse talent pool and lower labor costs.
In the past few years, offshore operations have leveled-up with onshore interaction excellence and shown tremendous growth with elevated workforce management, technology, and new-age training. If you’re concerned about the quality of CX performance in offshore centers, be selective about what you move offshore. Start with a smaller business segment and see how your customers react first.
Nearshore outsourcing strikes a happy medium between onshore and offshore outsourcing. Nearshore business process outsourcing is where you outsource to contact centers in a neighboring country, who have similar cultural attributes and understanding when it comes to CX.
Nearshore outsourcing offers two valuable benefits—you get the language and cultural behavior of the home brand with the costing benefits of an offshore market. For example, some countries neighboring the United States and Australia have a lower cost of living, so hiring high-volume customer service talent from these places can help to optimize operational costs. You still need to choose the outsourced business segment wisely and use a phased approach by moving a small segment first. Keep a close eye on how effective the nearshore centers are and track CSAT and NPS scores to evaluate outcomes.
This leading retailer successfully combined offshore and nearshore outsourcing strategies. They expanded their chat program, ramped up the number of agents, and looked to BPO to provide agents for voice as well as digital. The retailer expanded its chat services to Canada and deployed nearshore voice agents in Colombia to reduce costs and improve performance.
Work-from-home (WFH) agents
Although WFH agents have ranked as the most prioritized beyond-the-shore outsourcing strategy in a Covid-driven world, many industries were using them long before the pandemic. The remote work model eliminates the cost of office space and saves in-class training costs by providing highly-digitized, interactive, and economic virtual training.
In addition to cost-optimization benefits, WFH models also help your company reach a larger and more diverse talent pool with zero geographical challenges. Agents are more experienced, skilled, and have the perfect cultural etiquette for best-in-class customer interactions. Start by identifying which challenged business process you want to outsource, and your BPO partner will handle the operational strategies to boost customer satisfaction and agent retention. If you’re concerned about security and data breaches, choose a partner who provides a work-at-home security tech stack for agent monitoring, hires from a pre-vetted talent pool, and handles end-to-end transactions to mitigate risks.
If you’re not ready to offload key tasks but want to reduce costs and hand off management of some tasks to an external contact center, you can still lower costs for various segments by working with strategic partners. When you have outsourcing partners streamline services per your company’s needs, that’s call managed services. Your BPO partner will take on everything—from recruitment, training, and leadership development, to workforce management and success monitoring. Managed services provide value in key areas including access to a pre-vetted contingent workforce and working knowledge of CX best practices. Start by pinpointing a particular business need to offer the managed services team. Following careful observation and trials, you can gradually hand over additional segments.
Services supported by outsourcing companies
In a modern world, BPO offers a number of intelligent operation solutions to bridge the gap between your brand and your customers and help you level up with competitors. With industries sourcing BPO providers in healthcare, financial services, energy and utilities, retail and e-commerce, telecom, automotive, and many others entering the outsourcing world, business process service vendors have shown tremendous growth, leading to the addition of multiple subspecialties:
Information technology-enabled services (ITES)
This outsourcing model blends a general BPO process structure with information technology (IT). IT is a service delivery mechanism carried electronically over the internet, and has become a vital variant of outsourcing. At times, ITES BPO can also require support from telecommunication and data networks. For example, an outsourced IT helpdesk isn’t completely internet-based—the service provider manages service requests through calls and emails, accesses the company's network, and remotely views employee systems through sourced software, so they can solve every glitch efficiently.
Knowledge process outsourcing (KPO)
the business process outsourcing of knowledge-intensive activities, most often from Western companies to companies in India and the Philippines. KPO is a subset of business process outsourcing (BPO). Whereas BPO generally refers to the outsourcing of transactional activities, such as call center operations, KPO generally refers to the outsourcing of activities that are more knowledge-intensive, such as legal research, software development, and pharmaceutical research. The advantage of this type of business process outsourcing is that it can often lead to a significant cost savings for the company. In addition, it can also result in a higher quality of work, as the workers in the offshore location are often more highly skilled than workers in the company's home country.
The KPO vendor’s onboarded market researchers and strategic mentors use high-tech data analytics to bring operational excellence and efficiency. KPO prevails in accounting and financial services and engineering design and development.
Legal process outsourcing (LPO)
This type of Business process outsourcing is offshore outsourcing within the legal sector. It includes the offshore provision of services such as contract review, legal research, due diligence, compliance, and document management. The LPO industry has grown rapidly in recent years, as law firms and corporate legal departments seek to reduce costs. India is a leading destination for LPO, with a large pool of qualified professionals and low labor costs. Other destinations for LPO include the Philippines, South Africa, and Canada. Businesses are choosing LPOs because they can take on large, complex projects and have a proven track record of quality and cost efficiencies. Outsourcing also enables businesses to access legal expertise that may not be available in-house.