5 Step Process for Selecting your Outsourcing Services Provider

As effective as outsourcing has been, the key to your success lies in finding the right business process outsourcing (BPO) service provider. Thanks to its exponential growth over the past 15 years, more service providers have entered the industry, trying to get a piece of the US$548.5 Billion outsourcing pie.

With a deluge of choices comes the risk of the quality of service becoming diluted. The main reason companies use BPO companies is to reduce business costs. In a highly competitive market and with the absence of quality assurance measures, pricing cost becomes the key differentiator.

The market for business process outsourcing services has become cutthroat. Price and service quality has dropped to levels that would normally arouse suspicion but don’t due to these practices thriving. However, it has seen adverse effects on the industry.

Despite its sharp upward trajectory, outsourcing has had its fair share of critics. Some companies claim the outsourcing provider was overrated and the service provider underperformed and didn’t meet their business needs.

Business leaders warn that BPO service provider selection is vital due to the alarming number of small businesses that report they were victimised by online scammers.

Despite some pitfalls, using a BPO service provider provides businesses with several advantages. Using a third-party service provider to help with your business processes shines during times of economic downturn.

Using a BPO service provider has two main advantages. It reduces your business functions costs while increasing the level of productivity.

It is vital when using business process outsourcing to select the right service provider. There are many BPO service providers out there, so make sure you choose the right one to help your offshore outsourcing core business needs.

Follow These 5 Steps For BPO Success

Here is an easy 5 step process for selecting your outsourcing service provider.

Step 1 – Identify Your Business Requirements

“Why are you outsourcing?” There could be more than one answer to this question:

Reduce Cost – Most companies start small and get their feet wet by outsourcing non-essential tasks such as administrative work to lower costs.

Increase Productivity – In addition to non-essential tasks, you may want to outsource back-office functions such as Human Resources, IT, and Accounting. An outsourcing partner can help realign your resources only to the core functions of your business.

Improve Work Quality – With the right provider, you could outsource highly specialised tasks which require time and attention to become more effective. These highly specialised tasks include customer support, digital marketing, and telemarketing.

Once you have identified the tasks you want to outsource, it becomes easier to find the right business process outsourcing BPO for your business functions.

Step 2 – Research The Right Outsourcing Vendor

The Philippines and India are regarded as the top two destinations for outsourcing service providers. Organisations in the Philippines are widely reputed for customer support and telemarketing, while India is known for its world-class IT services and back-office support.

However, these countries have many business process outsourcing workers, so it could prove tricky to pinpoint the right vendor for your business processes.

Here are some risk management tips on finding the right outsourcing vendor:

  • Contact the local regulating agency and ask for recommendations or referrals. In the Philippines, the regulating agencies are the Business Process Association of the Philippines (BPAP) and the Contact Center Association of the Philippines (CCAP). These agencies have many BPO provider centres as members.
  • Join focus groups on social media and ask for recommendations. There are several outsourcing focus groups on LinkedIn. Engage with members to find out about their experiences with BPO services. They may also give you referrals to reputable vendors.
  • Given the popularity of outsourcing, a few of your friends and associates may know someone directly involved with an outsourcing partner.
  • Conduct due diligence. Once you’ve received some recommendations, always conduct due diligence work. A Google search may yield valuable results on BPO services.

Step 3 – Send A Request

Shortlist at least three qualified outsourcing BPO providers and ask them to submit a Request for Proposal (RFP) or Request for Quotation (RFQ).

Before the chosen BPO company can comply, they may send you a Request for Information form. This is a highly detailed form that will require you to answer both general and specific questions on outsourced projects. The RFI will be used as the reference guide for making the RFP or RFQ.

Step 4 – Initiate The Qualifying Process

Once you have received all of the RFP, do not eliminate the service providers based on their contents or pricing. Remember, everything is negotiable, including payment processing. As the outsourcing partner gets more details on your business needs, the quotation can be fine-tuned.

You should schedule an audio-video interview between your outsourcing team and theirs. Prepare a list of questions, the answers to which your team has fully researched beforehand and discussed. The questions should cover the following topics:

  • Timelines.
  • Hiring Process.
  • Data Security and Integrity.
  • Systems; Processes and Frameworks.
  • Existing Technological Profile.
  • Organisational Culture.
  • Grading and Performance Evaluation Processes.
  • Current Training and Orientation Programs.
  • Current Career and Succession Planning Programs.
  • Social and Cultural Nuances.
  • Disaster Recovery Planning.

Step 5 – Contract Negotiations

Rank the Service BPO Providers in order of preference. Prioritise negotiations with the right outsourcing BPO vendors and initiate contract negotiations. You should submit the following contracts to the BPO partner:

  • Service Level Agreement (SLA).
  • Memorandum of Agreement (MOA).
  • Confidentiality Agreement (CA).
  • Scope of Work.
  • Schedule of Payments.

The outsourcing service provider may want to use their own set of contracts. But it would be best to stay with a single contract, and it should be the clients. Contracts are subject to negotiation. The provisions in the outsourcer’s contracts could be discussed, negotiated, and considered for inclusion in the original agreement.

Make sure your SLA defines the conditions for pre-termination of services and outlines the penalties for any breach of its provisions. This acts as your Exit Strategy should the outsourcing agreement fail to deliver results as expected from your prospective clients.

Selecting an outsourcing service provider is a process in itself. But it is a process that you must undertake with purpose and strategy to find the best-fit outsourcing vendor to best suit your business model and give you a competitive advantage in the BPO market.

Do not select based on pricing alone but on the overall value proposition presented by the outsourcing vendor. Outsourcing is an effective solution in times of uncertainty. It will not just help you survive and save money during volatile periods but even thrive.

Contact Us Today

Many organisations have a poor track record when trying to manage their center operations by just using their in-house team. Often the quality of customer experience is lowered by trying to carry out all the office work themselves.

If your company is focused on becoming a real global presence, then you need to embrace new technology and find the right partner for all your outsourced needs.

Finding the right BPO provider is vital in the real estate industry to help companies grow to the next level. Providers in other countries and time zones can provide outsourced work to organisations and companies like yours while providing value for money.

If you believe it is a good business case for your company to hire a BPO provider, then do not hesitate to contact us today for further details.

We have a pool of talented VAs ready to take on countless tasks so that you can become more dollar productive. We can discuss all the options available and you could be outsourcing mundane tasks in a matter of days.