Pros And Cons Of BPO Business Outsourcing

Today most of the companies wants cost cutting in their business. Nowadays outsourcing helps to achieve such goals. According to the internet, (www.flatworldsolutions.com), outsourcing can be to as the allocation of specific business processes to a specialist external service provider. Outsourcing is an arrangement in which one company provide services for another company that missing or don't have a specialist in the certain area of expertise. Most of the times, an organization cannot handle all aspects of a business process internally. Additionally some processes are temporary and the organization does not intend to hire in-house professionals to perform the tasks.

Outsourcing is a business strategy that moves through a number of functions, processes, activities and decision responsibility from within an organization to outside providers, in order to reduce the costs of an organization. This is done through negotiating contract agreements with a vendor who takes on the responsibility for managing it. The decision to outsource is a major strategic most company, since it involves weighing the potential cost savings against the consequences of a loss in control over the products or services.

Outsourcing occurs when a firm subcontracts a business function to an outside supplier. Outsourcing is mainly the result of companies who will always pursue the lowest-cost structure, which means less skilled work will move out of the U.S. to emerging economies.

Growing business organizations are constantly looking for ways to improve their performance by decreasing operational costs and increasing revenue. Business Process Outsourcing (BPO) is one of the strategies that can facilitate these goals. BPO refers to outsourcing of business processes to external agencies, with the goal of relieving the company of non-business-critical tasks, while concentrating on its core business.

Outsourcing refers to a part of business operation or job function conducted by external vendor instead of mother company based on the principle of competitive or competitive advantages and division of labour. In other word, in most case company cannot manage its whole aspect of business function instantly at that time management allocates specific business task or responsibility to a specialist external service provider in exchange of a reasonable amount of money is called outsourcing. According to the Greaver " Outsourcing is the act of

Outsourcing is a practice used by different companies to reduce costs by transferring portions of work to outside suppliers rather than completing it internally.

What is outsourcing? We have all heard the term thrown around but what does it really mean? Outsourcing is defined as contracting, sub-contracting, or 'externalizing' non-core activities to free up cash, personnel, time, and facilities for activities where the firm holds competitive advantage(BD,09).Outsourcing happens when company’s choose to purchases their needed products and or services from an outside supplier ( mainly other countries), rather than doing the same work within their own facilities.

Outsourcing refers to hiring an outside, independent firm to perform a business function that internal employees might otherwise perform. Many organizations outsource jobs to specialized service companies, which frequently operate abroad. The outsourcing trend stands to continue; the latest wave of outsourcing impacts the information technology field. IT outsourcing includes data center operations, desktop and help desk support, software development, e-commerce outsourcing, software applications services, network operations and disaster recovery.2

Outsourcing in different countries of the world has grown and is continuing to grow very rapidly, at a recorded rate of 20%-25% a year (Top 10 Risks of Offshore Outsourcing). Because of the many advantages that businesses can gain from outsourcing, there is no certainty that there will be a reduction of outsourcing anytime soon. The main advantage of making this business decision is that the businesses will have more time to focus on the principal aspects of their business, while the third party vendor focuses on carrying out the supporting aspects of the business. While that may sound good to many, there are a great deal of risks that comes with the process of outsourcing.

Over the past decade or more, outsourcing is becoming an essential success factor. Many multinational organizations rely on outsourcing for a variety of products and services such as technology, customer support, automobile, clothes, telecommunication products and many more (Gottschalk, 2006). Outsourcing is an excellent process when it comes to cost advantage. Additionally, it provides organizations the time and workforce to focus on organization’s core business capabilities (Gottschalk, 2006).

The strategic effort of outsourcing is to allow concentration on what the organization does best. In addition, outsourcing assist companies to acquire cost advantage by tabbing into cheap labour; identifying companies with high competency level in the area outsourcing is required; and adds value to the overall process of the organization. However, it is important to note that as mentioned by Child (2005) if outsourcing is not carefully considered the organization may be prone to failure. Therefore, it is very crucial that various elements be thoroughly considered before deciding on what aspect of the organization to outsource.

Business Process Outsourcing (BPO): Xerox business process outsourcing services provide support functions such as customer care, transaction processing, finance and accounting, and human resources to a broad range of firms and organizations. The BPO services segment is focused on providing support functions to select business groups and industries including healthcare, commercial industries, public sector, and government healthcare. Through its healthcare provider solutions, the firm supports health providers operating in varying capacities to better access patient data, comply with industry regulations, reduce administrative costs, and provide better healthcare services. To commercial and public sector entities, Xerox provides support with transportation and logistics, electronic toll collection, parking management, health and human services, administrative support, and various taxation related functions. Xerox also offers many of these services across major global markets.

Business Process Outsourcing (BPO): Xerox business process outsourcing services provide support functions such as customer care, transaction processing, finance and accounting, and human resources to a broad range of firms and organizations. The BPO services segment is focused on providing support functions to select business groups and industries including healthcare, commercial industries, public sector, and government healthcare. Through its healthcare provider solutions, the firm supports health providers operating in varying capacities to better access patient data, comply with industry regulations, reduce administrative costs, and provide better healthcare services. To commercial and public sector entities, Xerox provides support with transportation and logistics, electronic toll collection, parking management, health and human services, administrative support, and various taxation related functions. Xerox also offers many of these services across major global markets.

Information and communication technologies are of paramount importance in the process of international outsourcing primarily through the technological advancement surge and demand in recent years. Through the rise of Information technology in recent years, the importance of international outsourcing rose significantly. Outsourcing is the contracting of the management and/or execution of a business function to an outside third-party contractor or subcontractor. Outsourcing typically refers to the contracting of services to an offshore, rather than domestic, company. While outsourcing has been an accepted business practice for

One of the influential factors on implementation success that emerges from research, trade literature and practice is the level of process orientation within an organization. (Parkes, 2002). Typical advantages of implementing a BPM system in an organization are reduced lead times, fewer hand-off errors, and more flexibility to change the structure of supported business processes. (Parkes, 2002). In the research community, there is some consensus that the essence of a BPMS is the functionality that has been attributed historically to a workflow management system. (WfMS). (Van der Aalst et al., 2003, p.