One of the most attractive aspects of larger businesses is the ability to outsource some of the functions of daily business processes in order to save money. While this might make good financial sense instead of hiring new employees, there are also some risks with business process outsourcing.
When most companies are beginning or are growing, a lot of the processes of daily business are done in house in order to save money. Things like customer service, accounting, human relations, data management and more are often falling on the backs of a few employees. This saves money for the small business owner, however when the company begins to grow and expand, most business owners are faced with the decision of whether to hire new employees or seek outside specialist to handle certain aspects of the business.
Business process outsourcing (BPO) is the method that this is accomplished. While using an accountant do take care of taxes and payroll makes good sense, are there problems with outsourcing other aspects of your business?
One such risk with BPO is the risk to current employees. Unless you have one employee handling multiple tasks, will that employee or those employees have to be fired or laid off? Often times you can merge the employees into other aspects of the daily business model in order to keep those that are familiar with the company employed.
Another risky aspect is outsourcing the IT management of your company. If your company sends its data to a third party, can you ensure that it is secure from data breaches? What about other data? Can it be easily recovered and secured if you need it? Do you have a redundant backup plan in case of failure of your data and the outsourcing parties data?
There are many aspects to consider when outsourcing, these are just a couple of the bigger ones to consider. You can often tell when it is time to consider going outside of your business walls for support. Finding the right company to provide the services you need will take time and effort on your part, but the dividends will become more evident everyday.