The Business Process Outsourcing Model By Stephen Soos
BPO, or Business Process Outsourcing is the buzz word ofbusiness process re-engineering
. It seems like everyone seeks to outsource everything at the moment, and if you haven't outsourced some parts of your operations, you are running around like a headless chicken fighting little fires. The point is, BPO is actually really good for business's because it frees you to concentrate on your core business activities and lets others who are more able and focused take care of the non-core stuff that keeps you from doing what you are good at. In reality, all businesses outsource to some degree. Just having your accounts prepared and audited is a type of BPO.
Local Authorities in the UK took on the BPO ideology in the 1980's and many services, for better or worse, were outsourced and put out to tender in the private sector. In the last 25 years many of the larger consulting partnerships have grown large and profitable departments specialising in providing advice and implementation of BPO methods and practices to all sizes of business. However, BPO, or access to it has gone through a complete change recently, and with the growth of websites such as Guru.com, Elance.com and PPH, outsourcing now becomes a reality for the smaller business and allows them to compete on a level playing field with larger competitors.
An example would be a software platform that I developed in the late 1990's. This sophisticated vertical managed procurement platform took over a year to develop, it cost more than $1m and had 12 developers assigned to work on it. You could now have a similar, more modern solution developed in just 6-9 months at a cost of $50,000 or less. How, you say ? Well, technology has advanced, so that helps to a degree, but mostly because you can use low cost freelancers on Guru and Elance. You are then free to work on the strategic aspect of your business, whilst highly experienced and technically capable programmers do the rest.
I know, this all sounds wonderful if you want a fully featured business critical program developed, but what about a flyer, a marketing collateral, or simple 4 page site for a small shop ? Sign up to Guru.com, place the job specification on the site and wait for the proposals flood in. The ability of some of these freelancers on these sites is truly amazing. The cost of the work is a fraction of what it would cost in the UK or USA. I recently bought a fully configured eCommerce web shop for an associate in the car parts supply space, including graphics, products uploaded and payment gateway integration for just a paltry$600. That price also included loads SEO work.
What you can commission doesn't end at just websites and graphics. You can get marketing guru's, accountants, secretarial, and even calls centre staff manning a 24 hurl phone line from as little as $4 pean hour on a pay as you use basis. This then frees you to offer a similar quality of service normally only affordable by larger companies, for a small fraction of the cost. A lot of freelancers now have staff that speak good English, so no need to worry too much about your customers not being able to understand what is being said to them.
Indeed, there are pitfalls to BPO. You need to ensure that your job specification is highly detailed and make sure that you are very lucid about all required deliverables, timescales, needs etc, or you are not being fair to yourself or the freelancer. The key to this is to consider carefully what you want and communicate this in words and graphics if you can. Talk with your freelancers regularly and ensure that you use the escrow service provided so that you don't lose any money.
The BPO model can transform your business and let you to compete at a level that you never imagined possible before. You can quickly "E" enable your company and compete online for incredibly low costs.
I'am Stephen> and I'am happy to discuss my experiences, warts and all with you in these articles. My business, Crystal Medical is built around the BPO model with a very small cost base, but huge resource behind it, provided by very highly skilled and professional freelancers.
by: Stephen Soos
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