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Inside the Quality-First Contact Center

The Different Types of Outsourcing: Which is the Best Fit for Your Business?

 

types-of-outsourcing

Running a business is no easy task; it requires knowledge in multiple fields, infrastructure to run various processes, and money to supply both. Luckily businesses—especially small and medium ones—can access these services through outsourcing. In this post, we will guide you through the different types of outsourcing you can find in the market and how they may benefit your business functions, so follow along.

Outsourcing Based on Offered Services

Outsourcing services can be defined as any kind of process that you hire someone else to do for you, whether it be due to lack of knowledge or workforce inside of your company. Outsourcing optimizes certain processes and can even manage multiple departments in a single company. Here are some of the outsourcing services offered in the market.

Professional Outsourcing

Professional Outsourcing encompasses all professional services that your company might require or that your business might not have the appropriate training or licenses to perform in-house. It is one of the most common types of outsourcing and a lot of companies use it without realizing it’s actually outsourcing.

A business hiring a marketing company to scale its marketing strategies, or an accounting agency managing the company’s finances are some examples of professional outsourcing. Hiring professionals such as a law firm for one-time tasks like setting up a business is also part of this type of outsourcing.

IT Outsourcing

Companies that don’t have enough infrastructure or training on Information Technology services in their in-house operations might opt to outsource to IT companies; Most of them offer a wide variety of services, making this option one of the most cost-saving in the market.

If your company is looking to widen its servers because your product is at full capacity, your possible outsourcing partner should be able to provide this and other services that might be needed in the future, such as specialized technical support, cloud storage management, or even software development services to ensure your customer’s safety when using your product.

Multisourcing

Multisourcing is commonly used by large or complex companies that do not want to rely on only one outsourcing partner to manage their operations. Businesses usually multisource IT and manufacturer services, which can bring great benefits to the company, but it requires having an outlined strategy and well-established relationships with outsourcing partners to guarantee an optimal outcome for both the company and the vendors.

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Process-Specific Outsourcing

Companies save a lot of time and money outsourcing very specific processes related to their core business, and as a result, they are able to focus on their product. As an example, one of the most common Process-Specific Outsourcing services that companies hire are delivery services.

There are 3 types of Process-Specific Outsourcing

  • Knowledge Process Outsourcing (KPO), which specializes in the development and improvement of products through data analysis and research.
  • Legal Process Outsourcing (LPO), which deals with litigations, regulatory compliance, and any other legal processes.
  • Recruitment Process Outsourcing (RPO), which involves job posting, candidate evaluation, and any other aspect related to recruitment.

Manufacturer outsourcing

As a small business, manufacturing your products in-house might not be a problem in the beginning, but as the company grows so does the demand for your product.

Manufacturer outsourcing allows companies to sell the products they have envisioned without worrying about the cost of manufacturing facilities, raw materials, workers, and other expenses that come with it. This service is not exclusive to small companies. Large companies such as Apple and Microsoft outsource with manufacturers in China for mass production, and for much less than having the same components manufactured in the US.

Operational Outsourcing

This type of outsourcing is commonly associated with manufacturing companies, and it’s basically hiring a third party to manage an operation that might not be principal but is still essential, such as repair or maintenance of machinery. Delivery services also fall into this category.

Business Process Outsourcing

Business Process Outsourcing (BPO) is one of the most known types of outsourcing. It covers the most commonly outsourced processes companies require, such as administration or customer care.

Callzilla is one of the best outsourcing providers in this field, and we offer a wide range of services that will benefit your company. Are you looking for experienced and trained staff to cover your customer service operations? Do you wish to optimize your customer care operations using automated tools? Or maybe it is your lead generation process that needs a refresh? We create personalized plans with each of our partners, taking their business needs and strengths into account.

Outsourcing Based on Location

Outsourcing is a great way of having cost-effective and high-quality services, and cost reductions will depend greatly on where the outsourcing partner is located. These are the three options for outsourcing your operations, along with their pros and cons:

Onshore Outsourcing

One of the biggest benefits of having your operations outsourced onshore is the closeness; You won’t have to worry about time zones, plane tickets (in some cases), or passports in order to visit your partner to check on their operations. Although most outsourcing companies, onshore or not, are fluent in English, having your outsourced partner in the US helps avoid cultural barriers, and customers tend to feel their experience is a more relatable one when they interact with a US native.

The biggest con? The cost. Outsourcing inside the US is not the most cost-effective option out of the three. In some cases, hiring an onshore partner would cost the same as having the operations managed in-house, so for this reason, onshore outsourcing is usually not the first pick.

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Off-shore Outsourcing

Off-shoring services are often the go-to for small companies. It provides your business with the workforce, training, and infrastructure for much less than having the same service inside the US. In addition to this, agents can provide support in more than 1 language, making this a great way to strengthen your customer care department.

The biggest difference between this and the other options is the location; If you wish to visit your partner in India you will have to think about the costs of traveling for you and your staff, the cultural and language differences, and other things. Arranging meetings online might pose similar issues, like taking into account the time difference, which might affect immediate communication between your partner and you.

Cultural and language differences might also affect your customer experience. In terms of language, having a multilingual partner is a great plus, but most of your agents will not be native English speakers, and your operations may end up sacrificing quality and rapport with your customers in exchange for cost savings.

Nearshore Outsourcing

We leave nearshore the last but not least important option because it combines the best of the previous two for affordable prices without sacrificing the quality of service. Nowadays this option is one of the first options in which a company outsources.

Nearshore partners are notably closer to their employees in terms of location. Callzilla is one of the biggest nearshore centers and is based in Colombia, easily accessible by plane and much quicker to reach than offshore places like Manila or Delhi. The time zone will not be a problem either since most nearshore locations are located within the same time zone or only varying by a few hours. Immediate communication with your service provider will be much more effective, whether it is by face-to-face or online meetings.

Nearshore partners also manage customer support in multiple languages, and unlike offshore locations, these have had a closer connection to western culture and experiences. Here in Bogotá, our workforce is mainly composed of young educated people, most of them with high proficiency in English, and some of them even multilingual, making them a great option if you’re looking for a more conversational approach to your customer care department.

As you have seen, Outsourcing covers a wide range of services most companies will have to use at some point; some of them as a one-time thing, others that will be required for seasonal flexibility, and some others that will be essential to run the business. It is important to take into account your company’s needs and specialties, investigate your possible partner’s background and testimonials, and create a rough plan where everything you wish to improve is covered.

Now that you know all about the different types of outsourcing your company can benefit from, you can choose the options that work the best for you. Callzilla is ready to provide you with the best outsourcing services on the market, so wait no more and contact us.

 

 

Topics: Contact Center Outsourcing Call center outsourcing Nearshore outsourcing