Ultimate guide to outsourced data entry services

It would be fair to say that data entry is not considered the most glamorous of career options. In a world where children increasingly want to grow up to be social media influencers, working in an industry more associated with the word ‘repetitive’ than ‘celebrity’ can be a hard sell. While 10% of data entry clerks employed in the U.S. are ‘statistical analysis experts’, the remainder tend to be basic data entry operators who spend their days tackling the often time-consuming task of transferring hard copy material into software programs.

M_BlogT_Outsourced data entry services

The irony of the situation is that data entry is extremely important from a business point of view, with companies on an eternal quest to find the right balance between speed and accuracy. While it is essential that no time is wasted in the field, the simplest of mistakes can create the biggest of headaches for companies and their customers. Accurate, secure and high-quality data entry does not happen by chance and, regardless of public perceptions, it is a valuable task that needs to be treated as a priority rather than an after-thought.

While the U.S. is home to more than 150,000 data entry clerks, many organizations have realized there is a better way to address their data entry needs. Instead of spending big dollars and wasting precious time on hiring internal clerks or setting up entire data entry teams, they have joined thousands of other businesses in partnering with outsourcing providers that take care of the hard work for them. They appreciate that data entry is a specialized task that needs to be assigned to skilled professionals and if those skilled professionals just happen to live in a country where labor costs are 70% lower than Western nations, all the better.

What are data entry services?

Data entry is, quite simply, the act of entering data from various sources into a company’s computer system for processing and management. Ranging from repetitive and time-consuming entries to more research-based work, tasks can include painstakingly converting numbers from a PDF document into a spreadsheet or sifting through data to identify whether it is necessary, superfluous or even correct.

What has changed in recent decades is that ‘data entry’ now covers a broad range of services, each requiring specific skills and experience. Some of the most common data entry services include:

  • Data conversion: this involves converting files between different formats, with examples including PDF to Word, image to Excel or PDF to Excel. This branch, which includes the transcription of audio files to text, is also particularly important in medical professions where sheets need to be converted into a digital format.
  • Data cleansing: data cleansing is ‘cleaning’ data and involves more thought than data conversion. It sees specialists remove superfluous or incorrect data from the database in order to ensure the information is up to date. This process may need to be completed regularly to accommodate for a constantly changing database.
  • Data processing: this involves analyzing data to ensure the information is usable. Data processors must be able to create tables, charts and graphs that represent the data and they are then used to suggest improvements or modifications to a company’s processes. In some cases, such as product data entry, data processing can include working out a company’s profit across the month.
  • Data classification: this is the process of organizing data into specific categories based on the item’s properties. Also referred to as ‘sorting’, this includes data tagging - an essential part of preparing data for machine-run processes managed by AI.

What does it mean to outsource data entry?

Data entry outsourcing sees companies partner with third-party providers to handle their data entry needs. From raw data conversion and survey data entry to filling in Excel sheets for back-office accounting, quality outsourcing providers pride themselves on recruiting the right people and deploying the best technology to manage such services.

A large number of data entry tasks can be completed digitally, which makes them well-suited to being performed in an offshore environment. The appetite to outsource data entry services can be seen in numbers that show the sheer scale of the industry. The data entry outsourcing services market is expected to increase by $504 million from 2020 to 2025, with the APAC region (including the Philippines) occupying about 46% of the global market share. These are big numbers and rightly so given the impact the sector has on companies of all shapes and sizes.

What are the advantages of outsourcing to a data entry service?

There are many reasons to outsource data processing services, not least of all that you or your staff will no longer need to worry about managing it. While outsourced teams are trained and efficient in data entry processes, assigning such repetitive and time-consuming work to employees detracts from them being able to perform their core roles within the business. The chance to focus on more rewarding and valuable work also leads to spikes in productivity and staff morale.

The other main benefits of outsourcing can be summarized into three key areas.

  1. Cost savings: offshore data entry specialists are available for a fraction of the price due to the lower cost of living in many outsourcing destinations. For example, outsourcing to the Philippines can result in companies saving up to 70% on labor and operating costs compared to hiring locally – and all without sacrificing a high-quality output. Outsourcing data entry services also allows businesses to avoid paying for training or infrastructure such as office equipment and computers.
  2. Less errors: skilled data entry specialists have years of experience and training, providing faster turnarounds and better accuracy than inexperienced internal teams. Work done by a professional will be more reliable and of a higher quality than entries completed by untrained employees. Reliable, professional standards ensure that outsourced data work is completed to the highest standard and in an environment where simple mistakes can quickly become costly mistakes, that is crucial.
  3. Enhanced productivity: this works on two levels. For starters, outsourcing allows companies to tap into the services of data entry specialists who are knowledgeable, hard-working and passionate about what they do. Filipinos, for example, are renowned for their loyalty and commitment, with the majority placing a high value on working with Western employers and this inevitably flows into their productivity levels.

Closer to home, assigning data entry work to in-house employees takes them away from the areas they specialize in. Furthermore, they tend to be less efficient than outsourced data entry professionals. Rather than local employees wasting time on tedious tasks, outsourcing data entry work increases productivity across the entire team.

The rise of the machines

Discussion has increased in recent years about the fact that in an age of artificial intelligence, data mining and smart technologies, data entry continues to be done manually. While many bystanders would assume it is only a matter of time before machines replace people in converting, cleansing and classifying data, there is evidence to suggest that technological solutions are not ready to replace human data entry any time soon.

One study focused on a start-up that planned to develop and use AI to produce data but asked its analysts to collect and enter that data manually in the meantime. When the time came to run its AI pilot, it found the technology was only capable of producing, at most, 5% of the data the analysts had been collecting and entering manually – and at a significantly higher price. This realization quickly shifted their data strategy from AI to human intelligence.

As the study’s author wrote: “Technology doesn’t always work as expected … while some of the data could be found easily in annual reports, for much of the rest, the analysts – and then the data entry operators – had to search the internet for additional information (and) then had to enter it into the database. It would make no sense and would be virtually impossible to automate the data entry part of this task.”

Just as machines will never be able to replace the human touch in healthcare, the creative arts and education, data entry is set to remain the domain of people. The introduction of technologies such as the Cloud and scanning software have undoubtedly played a beneficial role, but, when all is said and done, data entry specialists continue to play a vital role – and all the more so when they have the backing of a specialist outsourcing provider.

How to start your data entry outsourcing journey

By now, it should be obvious that outsourcing data entry services makes smart business sense. Before rushing to sign on with a provider though, it is essential to take the time to consider a few key factors.

For starters, make sure you get your math right. Comparing the cost of in-house and offshore options will ensure you know exactly how much partnering with a firm will benefit your bottom line. It is also important that you evaluate your own specific needs (e.g data conversion, data extraction) and make sure your potential provider uses the latest technology and software to optimize their performance and your results.

Finally, having agreed to terms including turnaround times and performance management processes, the day will arrive when your data entry services start being outsourced and, as many businesses have already found, there will be no looking back.

Data cleansing is a technical skill in its own right and essential for ensuring businesses have ‘better’ data for ‘better’ decision-making. Discover benefits of outsourcing data cleansing services, examples of related roles and a visual insight into how to structure a data cleansing team.