Back Office Services Defined

The term ‘Back Office’ apparently came into being based on the building layout of companies. Companies’ front office would contain the sales and other customer facing staff, whereas, the back office would consist of those involved in manufacturing, producing or developing the products or involved in administration but without being seen by customers. Back office operations are usually not given a lot of consideration, however, in recent times they have become a major contributor to businesses worldwide.

A few of the common back office operations outsourced to BPO services companies that most people are familiar with are: –

• Data Entry & Data Processing

• Forms Processing

• Catalog Design and Creation

• Insurance Claims Processing and many more…

These services have gained a lot more traction in recent times and have become the primary outsourced job functions for Medium & Large organizations worldwide. Organizations have gained a deeper realization that such job functions can be done either Offsite or through Offshore BPO Outsourcing organizations at a low cost and the quality levels achieved are far better than carrying out these tasks in house.

The 3 main factors influencing the decision of organizations behind Outsourcing back office job functions are –

Recruitment, Training & Staffing

Organizations do not need to go through the trouble of recruiting and training employees or individuals to carry out these job functions. Some of these job functions are complex and involve vigorous training which can last up to a month. Taking into consideration today’s volatile economy and the high levels of productivity that organizations need to achieve to remain competitive, it is imperative to have an employee being productive right from day one of their being recruited. As an organization you feel the pressure of customer satisfaction and on deliverables especially if you are constantly in the process of training employees on the one hand and have a high attrition rate on the other.

Through Outsourcing, you gain by not having to waste your organizations useful resources on Recruitment and Training in such areas. You are adequately staffed and your company has a more lean look and feel to it. Resources can be used more strategically for generating more business or they can be utilized to help increase current business by focusing on the organizations core activities.

Cost & Quality Benefits

Lean six sigma and other management methodologies have been a guiding force and a basis of benchmarking for most organizations seeking to reduce operating costs and maximize profitability. For instance, through outsourcing back office services organizations can instantaneously look to reduce costs related to Salary, Infrastructure & Logistics, as well as Training and Quality cost.

Apart from realizing cost benefits, the organization also gains leaps and bounds on the Quality front. The most comprehensive factor being that an organization can outsource a particular job function to a company that specializes in providing services in that domain. This in turn helps the organization outsourcing to not only deliver based on the expected customer level, but it also creates room to add more value to your end customers.

Dana Snow