10 tips to successfully outsource to a BPO

September 22, 2020

Bernat Fages

Most businesses are running on one or more routine manual processes. These processes might be less valuable, interesting or difficult relative to all other work, but still vital to keep the business running smoothly. This class of workflows make for perfect candidates to be outsourced.

If you're considering outsourcing an internal process to a BPO (Business Process Outsourcing) firm, you've come to the right article. Our unique position as a software provider for routine manual processes allows us to meet and facilitate work between various BPOs and our customers.

Below we enumerate a series of recommendations that will enable you to successfully transition a process to a BPO.

1) Craft operational guidelines

Put together a document that explains the process in detail. If you can't describe your process in detail, you won't be able to outsource it. This document, formally known as Operational Guidelines, will codify the various considerations one should make when performing the task at hand.

It's also a good idea to articulate what the goal of the process is and why it matters to give the outsourced reps a sense of purpose and impact.

These guidelines will act as the manual that reps will interiorize and refer to first when in doubt. It will be a living document that you will maintain and evolve as the reps and you find inconsistencies and gaps between your theory and the reality.

2) Prepare training examples

Theory means nothing without practice. Once your guidelines are in a good state, complement them with examples that reps can use to practice what they've learned on and self-evaluate.

You should include examples of increasing degrees of difficulty and which put to practice the different do's and don'ts of your Operational Guidelines. You may want to do this in the same document or in a presentation.

3) Evaluate firms based on expertise

Most BPOs out there tend to concentrate on a particular range of tasks, depending on the demographics and skillset of their workforce and recruiting ability.

Some aspects to consider:

4) Trial more than one firm

Engage in a timeboxed, pilot period with more than one BPO with uniform pre-agreed criteria. Establish measurable factors for success evaluation — more on this below — as part of the engagement.

Evaluate successful pilots that meet the criteria by assessing their costs and benefits so you can select one that works best for you in the long run.

5) Measure

Implement systematic measurement of the following metrics:

We've previously written on the subjects of Operational KPIs and Quality Measurement if you want to learn more.

6) Set SLA-based penalties

If your BPO partner has no 'skin in the game' you will likely fail to get your outsourced process where it needs to be. A standard practice that improves the alignment between your and the BPO's incentives is to set SLAs on the metrics above, alongside penalties for not meeting them.

These penalties usually exist in the form of percentage discounts on the billed service costs.

7) Set economic incentives

Another form of 'skin in the game' worth considering is reward-based incentives. Whereas SLA penalties help avoid mediocre results, rewards may contribute to moving the needle from adequate to outstanding.

8) Audit output

Once the outsourced process is put into operation we will need to audit a sample of the work conducted as a means of quality control. You may do this more formally if you implemented an internal Quality Assurance process, or just informally by reviewing random examples.

What is important is to have an internal expert — this could be you or a colleague — audit this work in order to find mistakes. You should aim to correct every mistake. Some will be caused by a gap or point of ambiguity in the Guidelines. Others will be rooted in a lack of examples in the training materials and will need to be flagged to the BPO so it doesn't happen again.

9) Open dialog

Keep an open dialog of communication with the BPO. Allow questions, feedback and suggestions to flow both ways. It's in your best interest to make yourself and your team available to avoid blocking reps — if latency matters to you — and to help avoid errors.

If the software supporting the process offers a mechanism to make these comments, then you're all set. Otherwise you can set up a shared chat group with all stakeholders to also foster frequent communication and collaboration.

10) Align reps often

A common pitfall of fully operational outsourced processes is how little cross-pollination of knowledge exists between reps. As a result, each reps mental model of the process might diverge from everyone else's, resulting in increased inconsistencies.

This is especially true in a post-Covid world where everyone who can is working remotely, physically isolated from everyone else.

Hosting joint audit review sessions will help keep everyone aligned with your internal expertise. To make this most productive, everyone should prepare tricky cases they've encountered that they would like to discuss with the team.

Wrapping up

Some of these recommendations might be harder to implement without the right operations tooling. Human Lambdas, our software solution that helps operations teams and BPOs run more efficiently and diligently, has been built with these principles in mind. If you're interested in exploring how you can up-level your routine processes, feel free to get in touch with us.