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February 2019 | Outsourcing Blog | BPO Industry Updates and Articles

5 Common Misconceptions about Outsourcing

by: Sidney Liquigan

Thursday, February 21, 2019 | Comments (0)

Category: Outsourcing Research / Trends

Aside from helping businesses cut costs and improve efficiency, outsourcing also brings innovation and a wide range of resources that businesses typically can't acquire easily for their in-house operations. However, many businesses are still hesitant to outsource their business processes for various reasons. One is because of their inaccurate assumptions about outsourcing.

Below, we've debunked five of the common misconceptions businesses make about outsourcing.

Outsourced Work Has Poor Quality

Some businesses assume that because outsourcing provides services at lower costs, it means that the quality of work is lower, too. There's also the assumption that outsourced staff is less skilled that in-house employees in the US or Europe.

On the contrary, many businesses turn to outsourcing to get professional help from experts from different parts of the world. Outsourcing gives businesses access to a diversified set of skills and resources that can bring new strategies and innovations, as well as handle projects with a neutral or more objective perspective. In Deloitte's 2016 Global Outsourcing Survey, it said that some of the reasons companies outsource are to enhance service quality and to have access to intellectual capital, among other reasons.

Outsourced work is comparably more cost-effective than in-house teams not because of lower quality work, but because the cost of labor and overhead are much lower in some overseas outsourcing destinations and economies of scale enable large specialized providers to do more work at lower costs.

Outsourcing is Only for Big Companies

Startups and SMEs think that outsourcing is only for larger enterprises with the resources and capabilities to take part of their operations offshore. But there are many outsourcing opportunities available for any type of business. Companies of all sizes from different industries can outsource any part of their operations. Outsourcing providers offer customized services that cater to various objectives, including delegating small tasks and occasional projects, as well as expanding a part of your operations offshore.

In Deloitte's survey, the respondents said that the innovation that outsourcing brings is being used to increase the level of quality, lower costs of delivery, improve customer experience, decrease transaction time, and deliver new capabilities. With startups and SMEs having limited time and resources, these benefits, along with being cost-effective, prove that outsourcing can serve as an essential part of their growth strategy.

It's a Challenge to Communicate with Outsourced Teams

In outsourcing, clear and effective communication is important. Some companies worry that when they outsource to another country, it will be a challenge to communicate with the outsourced team because of the language barrier. Others also don't feel confident about not being able to communicate with the outsourced team in person.

Reputable BPO firms like MicroSourcing have standards in place when it comes to the level of education and language proficiency being required from outsourced applicants. According to international education and language training company EF's 2018 English Proficiency Index, the Philippines ranked 14 out of 88 countries, with a high proficiency score of 61.84.

In terms of remote collaboration, innovations in technology today make it possible and easier for outsourced teams to effectively communicate with the in-house team. In addition to email, there are now different channels of online communication. Project management tools and data management software that are accessed via the cloud also make it convenient to keep track of and monitor offshore teams and projects.

Outsourcing is Only for Tech Companies

Since tech business functions are not heavily impacted by distance, many businesses think that outsourcing only works for tech businesses. However, while IT is the most outsourced business function, it's not only for tech companies. In fact, according to Deloitte's survey, the majority of the companies that benefit from outsourcing belong to the consumer and industrial products industry. Many companies also come from the financial services sector, the healthcare industry, and just about 9% are tech and media companies.

Next to IT outsourcing, commonly outsourced services include legal processes, real estate, taxation, human resources, finance, and procurement. Your business doesn't have to be in the tech industry to take advantage of these services.

Clients Don't Have Control over the Processes

Outsourcing is meant to help lighten your load so you can have more time and money to spend on core business goals. And while BPO companies take care of the outsourced operations for you, their services are customizable to match your existing processes. If you prefer to maintain control over your entire outsourced operations, there are also other outsourcing options available, including the managed operations model.

Offered by MicroSourcing, the managed operations model is like having your own company in the Philippines combined with the benefits that outsourcing offers. You can send someone from your in-house team to serve as the operations manager of your offshore team, or hire and train a Filipino manager who understands both your company's and the local cultures. The managed operations approach serves as the middle ground between incorporating and outsourcing, where your company gets to enjoy the best of both worlds.


For any business, whether a large company or a small business, time and resources are valuable and must be used sensibly on aspects that matter most. Back-office processes that don't directly contribute to growing or improving your core business should be outsourced to professional BPO providers. One of these processes is managing the accounts receivables. It's a time-consuming activity that can be delegated so you could focus on revenue-generating activities.

Here are the ways outsourcing your accounts receivables can help your company save more money.

Ensures smooth cash flow

Having a proficient accounts receivable team ensures that payments are collected on time and tasks are completed efficiently. This helps provide regular cash flow, which in turn enables your business to run smoothly. Outsourcing your accounts receivables to a professional will not only offer you a team of specialists, but also innovative solutions and technologies that make the process quicker and more efficient.

Your own team without the extra overhead

One of the main benefits of outsourcing is you get to hire extra people without having to worry about additional costs for workspace, equipment, and the likes. Reducing staffing costs will improve your cash flow.

Lessens indirect costs

Reducing indirect costs through outsourcing your accounts receivables helps you achieve maximum profitability. The money you saved by delegating your admin activities to an outsourced team can now be spent on more useful, growth-oriented business activities.

Value for money

Not only do you have access to accounting and finance experts that can do the job effectively and efficiently, but you also get to obtain these services at low labor costs. According to studies, it costs around $9.38 for companies to send an invoice and 90% of that is because of labor costs. Outsourcing to developing countries with an educated labor force, such as the Philippines, gives you value for your money.

Better client screening

Outsourcing companies that have the expertise to manage accounts receivables can help you establish credit policies and procedures that will screen your clients thoroughly—if they are credit-worthy and are able to pay sooner. This kind of efficiency will save you money in the long term.

Pay for only what you need

Instead of having to pay a full-time in-house accountant or accounting team, increase your ROI by paying for only the service that you need, only when you need it. Outsourcing has flexible engagement models, including arrangements that allow you to acquire outsourced accounts receivables services for a certain period of time or only as needed.

Conclusion

Managing accounts receivables, while it's one of the lower priority business processes, can create a negative impact on revenues when not done efficiently. It's perhaps for this reason that accounts receivables was one of the first tasks to be outsourced, as well as one of the most commonly outsourced business processes today.

Make sure that your receivables are immediately converted into revenue by ensuring effective cash flow. Improving your accounts receivables collection process through outsourcing will help your company save money in more ways than one.


E-commerce: Tips for Outsourcing Customer Support

by: Sidney Liquigan

Tuesday, February 5, 2019 | Comments (0)

Category: Outsourcing Research / Trends

For an e-commerce store, customer feedback and loyalty play a big part in its success. Customers who are satisfied with their experience with an e-commerce store, not just with its products but also its customer service, could become repeat customers and bring in new referrals as well. Outsourcing customer support has become a business strategy that allows e-commerce stores to entrust their customer support tasks to a team of skilled customer support agents while the company focuses on growing the business.

To outsource your customer support successfully and get the most out of it, here are the top best practices that e-commerce businesses should consider.

Identify the Methods or Channels You Need

While it will always be better to be easily accessible through at least the most common and popular channels of communication, some may not apply or be necessary to your type of business and your customers. Decide whether you would outsource voice-based customer support, email support, social media management, or chat support. Before, there were only call centers for voice-based accounts, but now there are outsourced contact centers that enable you to outsource multiple methods of customer support through a single provider.

Consider Operating Hours

Whether you only have local customers or have customers from different time zones, achieve customer service satisfaction by having a customer support team that's always available. Look for a customer support outsourcing partner that can host and manage 24/7 operations.

Prioritize English Proficiency

Being the universal language, it is important that your outsourced customer support team are fluent in English and have a very good command of the language, both verbal and written. Not only can a fluent English speaker assist English speaking customers successfully, but the chances of misunderstanding instructions and can be reduced. Choose an outsourcing location where you can hire employees with high English proficiency. The Philippines, a leading outsourcing destination, has a pool of talent who are highly educated, can fluently speak English in a neutral accent, and have a strong affinity to the Western culture.

Don't Compromise Quality

Generally, the option to outsource is a lot more cost effective than building an in-house customer team. However, remember to thoroughly review each of your potential outsourcing partner's proposal, pricing arrangement, and credentials. Make sure that you get value for your money. Choose a BPO firm with experience in managing an offshore customer support team. Your partner must also have good recruitment, screening, and onboarding processes in place to make sure that the candidates you are hiring have the right skills and experience. You could also collaborate with your outsourcing partner to develop and implement customer support training programs. Never settle with a provider with incomplete services just because you want to cut costs.

CRM Integration

Your CRM system helps you understand your customers more and come up with strategies on how you can effectively address their pain points and attend to their needs. Your customer support outsourcing partner should have the ability to manage your customer database and to seamlessly integrate your offshore customer support account's data into your existing CRM.

 

Because of the online nature of an e-commerce business, there is no physical store or office where customers can talk to representatives face to face. Customers' first point of contact will be your customer support team. Therefore, the pressure to provide world-class customer support is heavier for e-commerce businesses. Build your reputation and keep your customers happy by outsourcing your customer support to a dedicated, professional offshore customer support outsourcing provider. Contact MicroSourcing and let's talk about the best customer support solutions that are right for your e-commerce business.