IT-BPO · Uncategorized

Minimizing Risks: Implementing Effective BPO Strategies

The emergence of Business Process Outsourcing (BPO) companies changed the way business is done. Building growth momentum at low cost, many firms are scrambling to take a share of the BPO pie—whether the intention is to create new opportunities in the marketplace or to focus more on their core business functions.

Regardless of its many “promising” outcomes, however, the allocation of specific business processes, such as customer support and software development, to an external service provider carries potential risks, which includes security breaches, compromised intellectual property (IP) rights, productivity fluctuations, loss of business knowledge, and lack of customer focus, among others.

Of this, minimizing risks when implementing external processes should always be a top priority in organizations.

Mapping the Right Plan and Strategy

1 Mapping the Right Plan and Strategy
Image Source:

Marty Pine, a recognized thought leader and an internationally known Global Business Services Professional, in his article, “Planning and Implementing BPO Strategy,” emphasizes “BPO-Strategy Analysis and Education” as a foundation for an effective BPO-strategy.

According to Pine, depending on the scope of the project, the preparation and implementation of a BPO strategy can take as long as six months. The basic steps, however, he says, are all the same. Of this, companies must:

  1. Analyze direct and indirect costs and processes, including sub-processes and projected investments;


  1. Educate themselves on governance and relationship management requirements, retained processes and organization, internal improvement opportunities, and the request for information (RFI) process; and


  1. As part of the sourcing strategy, they must consider single versus multiple providers, sole source versus competitive bids, and gather intelligence about prospective providers.


The second and third stages, says Pine involve “Request for Proposal (RFP) Development and Pricing,” and “Bid Evaluation and Negotiation.” During these stages, companies must already know where they stand and have a definitive direction on what they want to achieve. While requesting for RFP, for instance, they must be able to define their current and targeted service levels. Furthermore, they must also perform a financial analysis of economic and productivity factors. Having these two stages accomplished can help in the smooth transition process.

Practice Discipline

2 Practice Discipline
Image Source: Sally Godfey (2008) What is CMMI? NASA Presentation.

Apart from planning, companies must assure their readiness to adopt an offshore model. BPO, especially for startup companies, is a risky process since the quality of a product or service being offered is determined by the quality of process used to develop or deliver it. Process improvement training and appraisal programs such as Capability Maturity Model Integration (CMMI) may be considered to ensure the maturity level of an organization.

Build a Healthy Relationship with Your BPO Provider

Conflict with BPO providers are one of the major factors that disrupt the whole BPO process. Thus, it is essential to hire a BPO firm your company believes in. Avoid setting up unrealistic expectations, promote collaboration, and resolve conflicts as soon as they arise.

While following these processes may take a lot of work, they are necessary for minimizing risks, which in turn, can enhance your whole journey with your BPO provider.

An emerging IT-BPO company in the Philippines, BPSource provides an integrated, end-to-end solution that promote quality and innovation in organizations. Get more insights about the IT-BPO industry through our Facebook page.




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