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Business Process Outsourcing, the Solution to Non-Core Business Process Dilemmas

Ada Sandoval

Friday, June 11,2010

Business Process Outsourcing (BPO) is a growing at a stable rate in the Philippines. In an interview of Martin Antonio Crisostomo, executive director for internal relations of the Business Processing Association of the Philippines (BPAP), he says that about 80 percent of BPO companies come from the United States. He also cited that BPO employment is growing at a stable rate, with an 11 percent growth from 2008 to 2009. Indeed, the flourishing of BPO is undeniable. But what is driving overseas companies to outsource to the Philippines?

When a business contracts with a BPO company, it is basically outsourcing its operations and certain functions to that company which serves as a third-party service provider. BPO companies that are present here in the country are more appropriately termed to be “offshore” since the companies that contracted their services come from distant countries such as that of the US.

A few good reasons why the United States is outsourcing are the US’ aging workforce, and the ongoing shortage of BPO skilled employees, according to XMG Global Inc., Information and Communications Technology (ICT) research and advisory firm. The lack of manpower in American industries is one catalyst that drives them to consider outsourcing their business processes to BPO companies. XMG explains that with the endless advancements in technology and businesses’ desire to remain at par with competitors at a global scale, “… off-shoring will stand as a viable business strategy”. XMG also adds that since handling all business processes entails a high operating cost, businesses “… will continue to make off-shoring a worthy option”.

Aside from reasons of practical nature, partnering with BPO companies is also greatly advantageous for businesses. The most obvious benefit of outsourcing would have to be the improved efficiency of a business’s employees. More than often, employees within are burdened by the practical needs of a company. They’re restrained from performing more important, core business tasks by having to deal with administrative, non-core processes. By outsourcing non-core business processes, key employees can then invest their time and energies into giving focus on customers, products and services, as well as excellence in operation.

Another clear benefit of outsourcing to BPO companies is cost reduction – the effect of the less need for expenditures on people and equipment with outsourcing. This is because businesses will only be requiring key employees to continue operations, and do this within a small office space.

Outsourcing to the Philippines gives businesses an even sharper edge that will certainly pop the balloons of their competitors. The home to Filipinos that are highly English literate and proficient as well as immensely versatile professionals compared to neighboring Asian countries, Philippines can provide business processing solutions that can level or even overshadow contending global businesses.

Lastly, because BPO companies operate at a 24/7 basis under smooth Internet connections with advanced technologies, they can cater to businesses from whichever time zone they may belong to. Truly, business process outsourcing can resolve businesses’ dilemmas with their non-core business processes.

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