Back-Office Support and BPO: The interrelation of the two
Back office generally refers to the business operations, which do not involve any customer interaction. The back-office generally includes operations as: record maintenance, regulatory compliances, accounting operations, date entries, online researches, and similar.
Some financial institutions would typically be divided into three sections, that is: a front section which incorporates operations as the sales, customer support, and marketing of goods or service, a middle office which incorporates risk management, and the back office which encompasses services of support and administrative tasks.
From what has been said so far, it can thus be inferred that, the back office involves the tasks, which are behind the curtain, or which are not manifest to the customers; however, they are continuously being performed, in one way or the other, for making an organizational operations run and to provide the customers with the services, seamlessly and uninterruptedly.
As the importance of back-office operations is undeniable, supporting it, by the necessary means, carries an equal importance. Nonetheless, back-office support generally requires a company to spend a considerable amount of resources on it. Considering this, companies normally outsource the back-office processes. Companies find this back-office support outsource helpful to quite an extent. Also, the outsourcing of the back office support services is better known as the ‘Business Process Outsourcing’, which has been addressed in detail in the later section of this article.
Explaining the Business Process Outsourcing
Business Process Outsourcing or the BPO, as the name implies, refers to acquiring third-party services for some business process or procedure of an organization.
The business processes for which the organizations opt to acquire third-party services, includes but is not limited to: sales payrolls, sales prospects, talent prospects, the customer support, etc. From this, it can thus be inferred that business processes which are, to some extent, subsidiary to the core company processes, when outsourced, are referred as the ‘Business Process Outsourcing’.
Ways Business Process Outsourcing helps in
Companies, regardless of their organizational sphere, benefit from the back-office support company outsource. Below are the primary ways in which an organization benefits from the online back office support:
- Enhances the team productivity
- Lessens the Company Expenses
- Empowers business development
- Enhances the team productivity
When the teams are assigned tasks precise to their skills,the team productivity is bound to increase. By outsourcing the role-specific business processes, much of the employee resource is relieved from being overburdened. This provides the team with extra mental headspace for focusing on their core responsibilities. Consequently, the team performance enhances, which subsequently results in an enhanced team productivity.
- Lessens the Company Expenses
From online back office support and freelance back-office support to IT back-office support, no matter the kind of back-office support is required for the business process, it would always result in the reduction of in-house expenses. By outsourcing the business process, companies on a limited economic budget, can have fewer, yet important, employees only. This can result in smaller working space, which in return saves expense as the rental expense. Moreover, the resources as the time and money, which used to be spent on the training of the new employees, can be secured.
Additionally, if the company has outsourced its services, in the form of online back office support or the freelance back-office support, to some developing country, the company will be able to save a considerable amount of the monetary resource; which has nothing to do with a company’s policy, but with the very developing country’s low-labor cost.
Last, not the least, acquiring a third-party service for back-office support is not full time. It is, rather, acquired when needed. This gives a company benefit over having some regular employee; since, a regular employee would be needed to be paid all around the year; as opposed to a service-provider, who would be paid, only when there would be need.
- Empowers business development
This one use, which comes with the BPO, probably overshadows the other uses.
The pinnacle use of having your business process outsource is that it enables organizations to focus their business development processes more. There are the processes that help companies in standing out from their competitors and are the primary source of increasing a company’s revenue.
Use Cases for Back-Office Support
Enough with all the theoretical reasoning and explanations of what and what not! Let us explore real-world use cases, which include outsourcing of the business processes:
- Outsourcing the sale process
The outsourcing of the sale process, does not refer to the outsourcing of the sales process itself, but its supplementary process which eases the sales process.
Consider Mr. Stuart, who’s one of the top sellers in his respective company. However, he has always had spent a larger portion of his time searching for prospective clients. The time, which he spends in looking for potential customers, could rather be surfed on the revenue generating processes, such as the closing deals. Mr. Stuart, therefore, by outsourcing a part of the sales process, which is, the prospective client finding process, but not the actual sales process, can achieve new highs for him and his company.
- Human resource back-office support
Having back-office support in the human resource management can be a relief for the human resource department itself. Although human resource management requires a great deal of head-space, the hiring process is the one most hassle-some of them all.
As soon as a vacancy is required to be filled, the hr department would find itself buried under a sea of paperwork. As a consequence of which, the HR department is typically distracted from other attention requiring matters; subsequently the human resource control is affected badly.
Consider Mr. Harry, who’s an HR manager at some respective company. The company meets with a situation, where it needs to expand its workforce and that too in a shorter period of time.
Now, since the hiring procedure takes a great amount of time and energy, Mr. Harry finds himself in a bit of a dilemma; which is, he can either opt for an average candidate without carrying out extensive research on the candidature of a particular candidate, or that he can take sufficient time for finding a skilled candidate. The latter, however, may not be possible, given that the company is hiring candidates on the ad-hoc basis.
What Mr. Harry does is that he acquires a back-office support for this business process, which is hiring of the new candidates. By providing the third-party with the pertaining skill-sets of the candidates, not only the vacancies can be filled immediately with the suitable candidates, but Mr. Harry would continue heading the HR properly too.
- Outsourcing the general operations
General operations such as: making the to-do lists, making travel bookings, scheduling the meetings, etc., though are less in significance, but are supposed to get done.
Mr. Tim, he’s the CEO of a promising tech startup, located in Silicon Valley. He’s always being busier from attending the conferences to meeting the investors and demonstrating the tech products to potential clients.
However, with his day always occupied with something, Mr. Tim finds it hard to schedule his conferences, meetings, or the demos which he gives. Moreover, the necessary travel arrangements, which includes: air schedules, airline tickets purchase, and hotel room booking, have always come under conflict due to a lack of proper arrangements.
Nonetheless, all these general processes can be outsourced to some trustworthy third-party service provider. As a result of which, Mr. Tim could save himself from much of the hustle and any future inconvenience which may occur due to improper travel arrangements.
- Insurance industry back-office support
The insurance industry can not only make the most out of the business process outsourcing, but is rather perfect for acquiring back-office support services from third-party service providers.
The business processes entailed in the insurance industry, such as the analyzing and evaluating the insurance claims, are repetitive in nature against every insurance holding customer. However, when such processes are outsourced, can provide the insurance industry’s workforce with clear head-space for other significant processes.
Still, there’s a catch in it; finding the right solution provider for supporting back-office business processes. That said, a right third-party service provider can prove to be a sigh of relief for the insurance industry’s workforce.
- Back office involves the tasks, which are performed behind the curtain, or, which do not manifest to the customers; however, they are being performed continuously, in one way or the other, for making organizational operations run and to provide the customers with seamless services.
- For the back-office task support, a company is generally required to spend a considerable amount of resources on it. Considering this, companies normally outsource the back-office processes. This outsourcing is better known as the ‘Business Process Outsourcing’ or the BPO.
- A back-office task is a part of the whole business process; therefore, when the former is outsourced for ease, it is referred to as the BPO. And this is how the two relate.