What is Business Process Outsourcing (BPO)?

Business process outsourcing (BPO) involves contracting both internal and customer-related services to third-party suppliers.

Historically, outsourcing had largely been associated with manufacturing enterprises – think of car manufacturers, or electronics brands – where large chunks of their supply chains rely on the contribution of parts or labor from external suppliers. However, with digital connectivity changing the way that businesses operate, outsourcing is now making impact across industries like accounting and bookkeeping and across more areas of a business.

This outsourcing of these services is what is referred to as business process outsourcing.

From there, it’s broken down into three main categories – back office outsourcing, front office outsourcing, and technology-enabled outsourcing.

business process outsourcing in accounting

Back office outsourcing

The ‘back office’ refers to internal business functions – think of the services that might operate ‘out back’ of a store. These are functions like logistics, finance and accounting, human resources, compliance or quality control – basically any of the core business operations that keep things ticking. Therefore back office outsourcing means leveraging the skills of providers who are specialists in their own area of expertise to undertake these roles, acting in your businesses’ best interests.

Front office outsourcing

The ‘front office’ refers to customer-related roles, such as customer support, inbound or outbound sales or telemarketing. Front office outsourcing therefore means employing the use of customer care centers or representatives, outside of your core operations.

Technology-enabled outsourcing

Not surprisingly, the rise of cloud-based technology has seen a dramatic rise in the ease and accessibility of outsourced services. Now businesses can connect with their suppliers, and their suppliers with their customers, virtually in real time, with a seamless delivery of service for the customer. Because BPO relies so heavily on technology, it’s often referred to as Information Technology-enabled Services (ITES).

Why use Business Process Outsourcing?

why use business process outsourcingIf you’re an accountant or bookkeeper, the benefits of Business Process Outsourcing are many – flexibility, cost-effectiveness, improved productivity and better use of internal resource – which can all lead to growth and increased market presence.

See more reasons on how outsourcing could work for your business, or check out the full run-down on what outsourcing is and how it could work for your accounting or bookkeeping practice. 

TOA Global specializes in setting up and effectively managing offshore teams so you can free up time and focus on more revenue-generating, client-facing tasks. If you want to know more about how we can help, schedule a consult with our consultants today.