Why Business Process Outsourcing Is Critical for Small & Medium level Businesses
Critics of small businesses are stunned to see these non-funded and non-popular organizations disrupt saturated industries. Naysayers continue to look down upon small businesses for their lack of experience but they fail to utter a word about their expertise and impact. a
Global organizations continue to hunt and acquire these SMBs to reduce competition but there are stakeholders, who are adamant and are here to offer a better experience and exceptional services. While the motif is big, lack of resources and minimizing exposure is costing them both time and money.
SMBs today need a savior, a partner, and a guide. Outsourcing agencies can fil the experience gap and provide SMBs with the stipulated tools to overcome challenges and grow bigger.
Importance of Outsourcing
Outsourcing needs no introduction, by empowering industries like Telecom, E-commerce, Fintech, and Digital Aggregators BPOs have proven their worth. What makes Outsourcing one of the thriving industries in innovation, BPOs have innovated and catered to organizations with tailor-fit services and products.
Be it optimization, tech-adaption, or cost-efficiency, outsourcing helps organizations achieve all three. Going ahead outsourcing will continue to be a bigger part of MNCs’ day to day operations because it facilitates better decision making and improves efficiency through the cost-effective measure.
Every organization is made up of processes that are repetitive and of processes that require innovation. While innovation requires a defined skill & mindset but repetitive processes be handled to centers that have employees trained to carry out these tasks.
Increases focus on Core Processes: Executives and other leaders can use their available free time to focus on business planning and taking the organization forward.
Impacts Downline Positively: 59% of companies from around the world use outsourcing as a tool to cut overall business costs.
Amplifies Efficiency & Sets Responsibility: Letting industry experts handle your bookings and reservations leaves you with enough time to focus on important tasks adding up to your overall efficiency.
The Prevalent Challenges faced by SMBs
Small businesses often run into trouble because of less-exposure. With governments not paying much heed to these organizations, they often find themselves on their own. Be it tax complacency, employee rights, or effective management of resources. Lack of awareness, missing infrastructure, and no support from authorized agencies pushes these small but revolutionary businesses back.
Some of the Top Challenges SMBs face Today Includes
Cost-Effectiveness: Hundreds of small businesses try to sell products that fail because their production and marketing output is not cost-efficient. Lack of an audience, market, and exposure, keeps them from achieving the requisite arbitrage.
While the fund in hand is limited but the work in front is monumental; hiring and training an in-house team will help but it will eat up the available cash. With outsourcing mid-size businesses can collaborate with manufacturers who are already producing a similar line of product for other enterprises and procure their requirements from them. Such effective measures will allow SMBs to gain the requisite cost-effectiveness and they will also be left with enough funds to focus on other plans.
Increasing Backlog: Matters related to tax, employee retirement funds, and government approvals often get ignored, which with time becomes a heavy backlog to tackle. By leveraging industrial expertise through BPOs, small businesses can overcome the increasing backlog and focus on building effective products and services.
Lack of Agility: Though the business is less, market share is negligible but SMBs are forced to have bigger teams. They are bound to hire professionals for payroll management, catalog creation, IT managers, and one representative for every department like marketing, finance, and HR.
The business remains low but the organization grows bigger, which takes away the agility from the businesses. Lack of flexibility makes it tough for organizations to pivot and make the most of every presented opportunity.
In the age of cloud computing, it is not tough to provide a team sitting in the US with access to servers located in India and vice versa. Outsourcing is a viable tool for ensuring business continuity irrespective of the fact that there is a pandemic. In the case of natural disasters, manmade disasters, or attempts of internal sabotage, outsourcing can help organizations stand strong and cater to their millions of customers globally without any downtime.
What are the top Processes that SMBs can Outsource?
Lack of exposure is perhaps one of the biggest reasons why SMBS fails to make it big. These businesses have struggled enough and it is about time that they leverage available tools to gain an advantage over their peers. Customer surveys can help these businesses understand the mood of the market, which will help them decide better product pricing and marketing strategy and gain better exposure on launch.
The outsourcing market is overflowing with organizations that can conduct customer surveys and reveal hidden data that can simplify product development. With enough information related to customer expectations, developers can create a product that is ready for mass adoption.
Marketing and Lead Generation
Be it an online store or a local mart, they have numerous processes that require intricate attention of stakeholders. Failing to work on basics can land the founder of these organizations in legal trouble. Compliance requirements and following international guidelines are highly important for founders.
While cybersecurity concerns and compliance requirements eat up a lot of time, there’s very less attention span left for marketing and business development. Tech founders can easily collaborate with outsourcing partners to market their products or services.
Search engine optimization and social media marketing require nuanced effort, which involves incessant monitoring of budget, ranking, and impressions. When an important resource spends time monitoring social media campaigns, businesses are bound to lose market share.
Cyber Security Requirements
In 2020, the average cost of a data breach has reached a $3.5 million mark. Also in a recent study, it was revealed that 90% of businesses that faced data-breach were shut down within six months of a breach. Only a handful of businesses with trusted backup were able to survive the breach.
Data breach, unauthorized access, internal sabotage, DDoS attack, and Credential Stuffing are some of the latest weapons of hackers. People are trying to garner benefits by gaining illicit access to the databases.
Customer Experience Enhancement
84% of customers are not willing to engage with a business just after one bad experience. Not only that almost 50% of businesses have started redirecting their marketing funds toward customer experience innovation. In the age, where people are quite vocal on social media, and user-generated-content is a clear winner, organizations must offer quality pre and post-sale experience to customers.
Be it an online store or a restaurant business, everyone needs to work on their customer experience to retain their existing customers. Customers that feel valued are likely to tell their 5 friends whereas they will share their bad experience with 7 friends.
Common Repetitive Processes SMBs can outsource
Hiring & Training: Once you have developed a paradigm, you can create a Request for Proposal and receive proposals from industry experts. Scan through the RFPs received and you will find a partner that follows a very similar paradigm as your company or is willing to follow the provided paradigm for hiring and training.
Payroll management: Hiring an in-house accountant makes no sense when countries like India and the Philippines are offering a hundred percent accuracy in accountant services at affordable prices. The English speaking pool of talent from these countries has made it easier for businesses in Africa, Europe, and Middle-East to outsource processes and gain an advantage over the competitors.
Small and mid-size businesses may be not visible on the stock exchange and hardly make it to the newspaper headlines but their contribution to the economy is irreplaceable. SMBs make up for a huge part of indirect taxes in the global economy. Various studies suggest that taxes from SMBs alone can help many countries look after their education and healthcare budget responsibilities.
SMBs today are faced with challenges, which are there in the first place because of a lack of expertise and time. By letting BPOs handle these processes, SMBs can gain the obligatory expertise and also save ample time to focus on other important goals.
Explore the Business Process Outsourcing Expertise of Zrima