1. As major corporations continue to
expand their use of business process
outsourcing (BPO), now is a good
time to review whether outsourcing
is a good fit for your organization and
how to successfully leverage a BPO
investment.
BPO allows a company to focus
on its core business while leveraging
third-party experts for non-core func-
tions.Sometimes,that occurs overseas,
but most BPO occurs domestically—
meaning that most BPO spending
is cycled back through the domestic
economy.Key functions that are most
often outsourced include IT and fi-
nance and accounting, but BPO can
also be used for a wide variety of other
activities, such as human resources,
business analytics, sourcing and
procurement, marketing operations,
logistics, and supply chain functions,
to name a few.
Organizations that use BPO typi-
cally do so for one of four main
reasons:
Reduce Costs. Simply put, many
organizations may be able to oper-
ate certain functions at a lower cost
through BPO than through internal
operation. Using a third party can
provide a predictable, transparent
cost structure and allow for scalable
resources.This can also free up capital
for higher priority projects or new
opportunities.
Create Operational Flexibil-
ity. Outsource providers often have
more flexibility to respond and scale
to operational needs than internal
resources.When evaluating potential
internal vs. BPO alternatives, be sure
to look at factors such as internal
systems functionality and flexibility,
cost of labor, competitive responsive-
ness, scalability and expected impact
on the customer experience.Also,de-
pending on the BPO
provider selected,
outsourcing can help
an organization to
increase its supplier
diversity profile.
Avoid Resource
Constraints.Select-
ing a BPO provider
can help an organi-
zation to avoid in-
ternal resource
constraints—such
as availability, scalability, staffing is-
sues,geographical disadvantages,and
lack of native expertise. At the same
time, BPO allows an organization to
Fives Steps to making the most out of your BPO Investment
•Ensure that you have clearly defined goals about what you hope to achieve via BPO.
•Determine whether your BPO initiative is transactional, transitional, or transformative.
•Evaluate BPO alternatives based on factors like experience, scale, financial stability, and
cultural fit.
•Ensure that your BPO provider uses a defined approach to designing and deploying solutions.
•Measure your results continuously and proactively identify improvement opportunities
benchmark best practices and choose
from top industry experts in a given
field.
FocusontheCoreBusiness.Ulti-
mately, BPO allows organizations to
focus on that which is most essential
to the enterprise; and to prioritize
human and financial resources ac-
cordingly. Just as companies routinely
leverage outside legal, marketing and
accounting resourc-
es, so too, can they
benefit from out-
sourcing other key
operationalfunctions
in order to focus on
what they do best.
So what are the
key ways to le-
verage BPO for the
best results? First,
understand the dif-
ferent types of BPO:
Transactional
Transactional outsourcing consists

2. (continued)
of quickly deployable services that
allow organizations to focus on their
core business. These can be either
one-time or ongoing services, usually
available from a number of potential
providers. Examples include market-
ing operations (such as rebate and
reward fulfillment), sourcing and
supplier management,or IT recruiting
and staffing.
Transitional
Transitional BPO includes inter-
mediate, time-fixed solutions that
drive changes in process, structure,
technology or resources. Marketing
services is a common example—as
most large companies have experience
hiring outside creative agencies.Other
examples include inventory and facili-
ties management,forward and reverse
logistics, business intelligence, and
marketing analytics.
Transformative
Transformative BPO solutions
are the game-changers. They involve
longer-term improvements that
reduce cost and create value based
on a collaborative effort to optimize
the business process. Typically, they
involve not just operations, but also
research and analysis that identi-
fies improvement opportunities and
drive efficiencies. An example might
include a packaging audit process that
optimizes usage and drives new best
practices or a print management so-
lution that streamlines execution and
creates significant cost savings.
Thinking about BPO across these
dimensions can help your organi-
zation understand its outsourcing
goals and best evaluate internal vs.
BPO alternatives. Once you’ve made
the decision to explore BPO for a
specific activity, the next step is to
select resources that can deliver the
best value for your organization.
It’s important to evaluate resources
based on factors such as experience
level, scale, financial stability, cul-
tural fit and ability to drive desired
results. ◆
Paul Richardson is the director of
brandandbusinessdevelopmentatGroup
O (www.groupo.com).Recognized as a
top five Latino-owned business by the
Taking BPO to the Next Level
Group O is a business process outsourcing provider that helps its brand-name
roster of clients optimize performance through strategic marketing, supply chain,
packaging and business analytic solutions. Through years of working side-by-side
with Fortune 100 companies across a variety of industries, we’ve perfected a
proven, holistic approach to deploying new BPO solutions across each of these
dimensions. Known as our O-Sourcing™ Solution Delivery Methodology (SDM),
it helps ensure fast, reliable
launches and efficient, effective
ongoing operations.
The O-Sourcing SDM is
centered on client needs and
goals—and delivers a client-
specific solution blueprint to
simplify, streamline, and opti-
mize operations. Key elements
of the SDM include a set of
established solution deliver-
ables. These include a tailored
combination of people resourc-
es, best practice processes,
technology tools, facilities
and infrastructure, financial
management, and reporting
dashboards, a discover-design-
deliver-optimize lifecycle. This ensures that solutions are based on documented
client requirements and an Operational Playbook for each program. Once BPO
services are implemented, results are continually measured to ensure that key
performance indicators (KPIs) are achieved and improvement opportunities are
identified.
We use a defined solution governance approach. This includes documented
practices for communications, escalation paths, results management, change
management, risk mitigation and customer satisfaction. Additionally, we have
core program and project management elements. These ensure that each solu-
tion has a robust, defined approach to establishing deliverables and execution
expectations throughout the solution lifecycle and across the entire solution
ecosystem.
Once your BPO solution is implemented, Group O helps you make sure that
the results are matching expectations and service level agreements (SLAs) by
providing our clients with easy-to-view reporting dashboards, for example, which
provide fingertip access to essential program information.
USHCC and a
Corporate Plus
member of the
National Mi-
nority Supplier
Development
Council. Group
O is headquar-
tered in Milan,
Illinois.
Reprinted with permission from the September/October 2013 issue of
Minority Business Entrepreneur
For subscription information, go to: http://mbe.magserv.com or call (818) 286-3171