Why business process outsourcing is growing in Australia

Why business process outsourcing is growing in Australia
Photo: Crew, Unsplash

Business Process Outsourcing (BPO) has been steadily growing in popularity for businesses around the world, and it’s for a good reason. BPO provides outstanding opportunities to improve productivity and create more efficient business processes, so it’s no surprise to see Australian businesses wasting no time in jumping onto the BPO bandwagon.

What is BPO?

Business Process Outsourcing (BPO) is a growing trend whereby companies move some of their processes to a third-party provider, which is most often situated offshore.

The growth of BPO is fuelled in part by increasing demand in the downstream business sector, or those functions of a business that are close to the end user. This includes things like customer service or IT support. It’s more cost effective to shift low-value, yet resource intensive tasks to overseas operators as this frees up an Australian business to extend more of its resources towards developing higher value opportunities.

As more and more businesses seek to improve efficiency and increase profitability, BPO’s enormous potential for creating growth will only see the trend continue to gain in popularity.

What services can BPO provide?

Traditionally, businesses would complete all operations in-house, however, a more efficient strategy is to outsource these processes to offshore operations. There is a massive demand not just for non- technical tasks, but also more specialised services. This demand has seen a growing trend for Australian companies to shift legal tasks, content writing, translation jobs and IT services to BPO providers.

Customer support

Call centres that provide customer support service via phone and email are a favourite target for BPO firms. Economies of scale can be attained, as a call centre can provide greater coverage for more customers at a lower cost than if the processes are handled in-house.

Marketing

Telemarketing is an expensive business process that is necessary to generate awareness of a business’ goods and services. However, it’s not a service that is geographically limited and so is the perfect candidate for BPO. Indeed, this can allow a company to create interest in its products at a greatly reduced cost.

Back office functions

Back office functions such as payroll processing, data entry, bookkeeping and the like are no longer limited to being completed in-house and are also perfect candidates for BPO. Overseas third- party providers can provide excellent, accurate typists and professional bookkeeping/accounting services to potentially save an Australian-based company many thousands of dollars a year.

Web design and social media marketing services

View of notebook and web design plans
BPO firms can assist with web design. Photo: Pexels, Pixabay

The importance of maintaining an online presence is more important than ever, however, it can be a massive drain on resources and challenging to calculate an accurate ROI. Overseas BPO firms can provide the talent and expertise a company needs to create and maintain a dynamic online and social media presence at a lower cost compared to most homegrown talent.

Software design

Finding talented software design professionals can be a challenge for even the largest companies. However, with BPO providing access to a global pool of technical talent, it’s much easier for a business with an idea for a smartphone app or computer application to turn it into a reality.

Access to advanced systems

Infrastructure such as communication lines and IT resources are expensive to install and maintain, especially in a country like Australia. This is because the population is sparsely distributed across a large geographical area. Computer and software systems have a notoriously short lifecycle and soon need to be upgraded and updated. BPO provides the opportunity for businesses to access advanced software that they would not be able to afford otherwise.

Low cost of entry

Interior of a factory
Factory processes are relocated overseas because of the high cost of manufacturing in Australia. Photo: Tama66, Pixabay

BPO often provides an opportunity for businesses to enter into a market that would otherwise be a risky and expensive endeavour. Being able to outsource dramatically lowers the cost, and subsequently, the risk of investing heavily into machinery, labour and other forms of specialised capital.

Flexibility

BPO frees up resources for companies to scale their business without being tied down with the mundane but otherwise critical office tasks. With access to more resources and time, they are now free to develop and improve the core components of their operations or explore new opportunities.

Who is thriving with BPO?

Because BPO makes a lot of financial sense, a lot of small to medium sized enterprises are utilising the various services available to enhance their viability in the marketplace and remain more competitive. BPO provides affordable solutions for Australian businesses both large and small and everything in between. With the amount of profit BPO can bring to the table, many of Australia’s industry leaders are taking advantage of what it can offer.

Companies like Telstra, Optus, and Jetstar have been taking advantage of BPO for many years. Serving millions of customers presents many financial and logistical challenges. BPO provides cost-savings that benefit their customer base by freeing up resources to provide better service, room to invest in new technologies, and maintain existing infrastructure to a high standard.

The future of BPO

There continues to be a growing demand for human resources and technical expertise, especially in the digital and online sectors, but these services are often out of reach for emerging businesses. However, BPO offers more than just cost savings. It also opens a wider talent pool for Australian organisations to draw from when developing strategies to improve business outcomes. BPO can help fledgling companies remain viable in an increasingly competitive market, while helping established companies improve their operational efficiency, quality and overall output.

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