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Home » Glossary » Customer Experience

Customer Experience

Definition

What is customer experience?

Customer experience (CX) is often defined as the overall interaction of the customer and organization for a certain period of time. This interaction constitutes the following: customer involvement, customer journey, and the environment. 

Having a positive review on each point of contact means that the customer experience is pleasant.

Customers’ involvement may range from emotions, whether rational or irrational, to physical needs, or psychological needs. Moreover, it can extend from the simple act of talking with customers up to the product packaging, features, reliability, and affordability. 

Overall, a positive customer experience is an excellent competitive edge that your company should provide in order to stay competent and successful in the market.

What is customer experience?

Why is customer experience important?

Providing an excellent customer experience is important for any business. The better CX you deliver, the more customers you will gain and retain. 

Additionally, service representatives would have to deal with lesser customer complaints and product returns.

A company with a great CX is projected to earn:

  • More loyal customers
  • Increased customer satisfaction
  • Positive reviews and recommendations

Customer experience outsourcing

Outsource Accelerator provides you with information about what to look for in outsourcing companies that can help you create a platform that encourages a positive customer experience. 

It is important to work with someone who can help your customers have a memorable journey with you, which is essential in achieving customer loyalty. After all, customer loyalty is the foundation of brand recognition and credibility in the market. 

Outsourcing helps you work with professionals who are well-versed with the right skills and experience to implement customer service strategies that work.

Outsourcing FAQ

What is a Customer Service?

What is customer service?

Customer service is a process of delivering a product or service to a customer in an efficient, accessible, cost-effective, and satisfying manner. It is creating a relationship that involves trust and builds loyalty, even after the delivery is made.

Customer service is knowing how to deal with customers and understanding their needs and wants. It is finding what customers want during the entire process of delivering the product or service.

Excellent customer service is knowing when to ask the right questions to get the correct answers. It is listening wholeheartedly to your customers as if you’ve known them for a very long time. Excellent customer service is learning to adapt and provide solution to each individual client.

It is discovering the right level of judgment then and there. Most importantly, in-depth knowledge of the products or services you offer is the ultimate foundation of a great customer service experience.

Communication skills, creating the right environment, and being friendly aren’t enough if you don’t have in-depth knowledge of the product or service that your company offers.

Outsourcing of customer service

Outsource Accelerator provides you the best customer service outsourcing companies in the Philippines, where you can save up-to 70% on staffing cost. We have over 3,000 articles, 200+ podcast episodes, and a comprehensive directory with 700+ BPOs… all designed to make it easier for clients to learn about, and engage with, outsourcing.

First call resolution definition

What is the first call resolution?

First Call Resolution (FCR) is a crucial metric in customer service that measures the ability of call centers to address customer calls and resolve their problems during initial interactions.

The primary goal of FCR is to ensure that customer problems, inquiries, or concerns are effectively resolved without the need for subsequent follow-up calls or interactions.

First call resolution is an essential element of Customer Relationship Management (CRM) and is one of the crucial metrics of a contact center. It measures the way the customer service representative addresses issues, problems, and queries on the first point of contact.

This exhibits how the recipient of the call gives quality resolutions to customers being catered to firsthand.

Regardless of the level of difficulty, as long as it was appropriately handled on the initial call, it would still be tagged as First Call Resolution, improving the representatives' metric scorecard.

Benefits of first call resolution

Monitoring first-call resolution allows a company to identify issues in its customer support process and quickly resolve them.

Fewer client complaints mean better first-call resolution rates and customers.

If your business strives to deliver quality customer service, then you should be on your first call resolution. Improving it is crucial and gives your company benefits such as the following:

Customer satisfaction

Solving pain points at the first customer interaction can be the difference between whether customers stay or go. If a customer is satisfied with their experience, then they will stick to your brand leading to customer retention.

Can earn brand promoters

When customers experience prompt and effective solutions, they are not only satisfied but often become promoters of your brand.

Word-of-mouth marketing is a powerful tool, and First Call Resolution puts it to work in your favor.

Maximizes your team's productivity

Figuring out an issue during the first interaction means that your team will deal with fewer repeat calls and could focus on more complex issues.

This not only boosts productivity but also creates a positive ripple effect on the overall performance of your support team.

Challenges of first call resolution

Implementing and achieving First Call Resolution (FCR) can pose various challenges for organizations. Some common challenges include:

Complex issues

Customer issues can vary widely in complexity and nature. Agents may encounter challenges in resolving intricate or technical problems within the limited timeframe of a single call. This lead to a lower FCR rate.

Lack of information

In some instances, customer support agents may not have access to sufficient information or documentation to address certain customer inquiries. This leads to the need for follow-up calls.

Insufficient training

Inadequate training programs can hinder agents' ability to understand and resolve customer issues efficiently. A lack of comprehensive training on product knowledge, communication skills, and problem-solving techniques may contribute to lower FCR rates.

Ineffective communication

Miscommunication between the customer and the support agent can result in misunderstandings. This potentially leads to unresolved issues and subsequent follow-up calls.

Technology challenges

While advanced technology can enhance customer service, its improper implementation or insufficient integration with existing systems can be a hindrance.

If agents struggle to navigate or utilize technology effectively, it may lead to longer resolution times and lower FCR rates.

Inadequate knowledge sharing

Poor knowledge sharing among support teams can lead to instances where agents lack awareness of successful resolution strategies, making it harder to achieve FCR consistently.

Volume and workload

High call volumes and heavy workloads can impact the efficiency of issue resolution. Agents may prioritize speed over thorough resolution to manage the workload, potentially affecting FCR performance.

Varied customer expectations

Customer expectations may vary, and some customers might have unrealistic expectations for immediate resolution. Managing and aligning these expectations is crucial for FCR's success.

Incomplete customer information

Insufficient or inaccurate customer information can complicate the resolution process. Agents may spend time gathering details instead of focusing on the actual problem during the initial call.

Continuous process improvement

Establishing a culture of continuous improvement is essential. Organizations may struggle to adapt and refine their processes to enhance FCR rates over time.

How to improve your first call resolution rate

Resolving customer issues efficiently on the first call not only enhances customer satisfaction but also contributes to the overall success of call center operations.

Here's a comprehensive guide on how to boost your first contact resolution rate and elevate your customer service game.

Comprehensive agent training

Invest in thorough training programs for your customer service team members.

Equip them with in-depth product knowledge, effective communication skills, and problem-solving abilities. Well-trained agents are more likely to resolve issues on the first call.

Utilize advanced technology

Embrace technology that supports FCR efforts. Implement customer relationship management (CRM) systems, AI-driven chatbots, and other tools that streamline information retrieval and enhance issue resolution capabilities.

Encourage active listening

Train your agents to listen to customers' concerns actively. Understanding the issue completely on the first call is crucial for swift resolution.

Active listening builds rapport and ensures customers feel heard.

Empower agents with decision-making authority

Grant your agents the authority to make decisions and resolve certain issues without escalating to higher levels. This autonomy speeds up the resolution process, contributing to a higher FCR rate.

Implement knowledge base systems

Develop and maintain a robust knowledge base that agents can access during calls. A comprehensive knowledge base reduces resolution time by providing agents with quick and accurate information.

Regular performance feedback

Provide regular feedback to agents based on call monitoring. Highlight areas of improvement and recognize successful FCR instances. Continuous feedback motivates agents to enhance their performance.

Set realistic goals

Establish achievable first-contact resolution goals for your team. Unrealistic targets can lead to rushed interactions and lower customer satisfaction. Strive for continuous improvement rather than immediate perfection.

Customer feedback surveys

Implement post-call customer feedback surveys. Analyzing customer input provides valuable insights into areas that may need improvement and helps in refining FCR strategies.

Collaboration and knowledge sharing

Encourage collaboration among agents. Establish platforms for knowledge sharing where agents can discuss and learn from each other's experiences, contributing to collective problem-solving skills.

Customer service portal

To improve customer experience, develop a customer-centric self-service portal or hub that includes Frequently Asked Questions (FAQs).

Implement live chat, social media messaging, and diverse communication channels to engage with customers on their preferred platforms, aiming to diminish the necessity for phone calls.

Use FCR to improve your overall customer satisfaction

Leveraging First Call Resolution (FCR) is a key strategy for enhancing overall customer satisfaction. FCR plays a crucial role in shaping the customer experience and positively impacting satisfaction levels.

Here's how you can use FCR to improve your overall customer satisfaction:

Prompt issue resolution

Resolving customer issues during the initial contact demonstrates efficiency and responsiveness. Customers appreciate timely solutions, leading to increased satisfaction with the support provided.

Reduction in customer effort

FCR reduces the need for customers to make repeated contacts or engage in lengthy follow-ups to address the same issue. Minimizing customer effort in issue resolution contributes to a smoother and more satisfying experience.

Enhanced customer perception

Successful FCR contributes to a positive perception of your organization's competency and commitment to customer service. Customers are more likely to view your company favorably when their concerns are promptly and effectively addressed.

First call resolution call center

In Business Process Outsourcing (BPO) companies, First Call Resolution (FCR) is a standard. With their in-house team players, it is easier for them to find immediate resolutions despite who or what the concern is all about.

They should be equipped with extensive training and more exceptional experience in BPO. It is essential to know that the blueprint of First Call Resolution is being alerted.

However, not all concerns can be resolved immediately with just one call; there are specific issues that need to be escalated.

Therefore, it is imperative to get professionals to improve their First Call Resolution by evaluating their calls with the help of a quality assurance team.

Outsource Accelerator has over 5,000 articles, 470+ podcast episodes, and a comprehensive directory with 3800+ BPOs… all designed to make it easier for clients to learn more about managing an outsourcing team and ensuring that FCRs are consistently high.

What is Customer Satisfaction Rating (CSAT)?

What is customer satisfaction (CSAT)?

Customer Satisfaction Score (CSAT) is a popular key performance indicator that measures customer satisfaction.

The process involves a survey question or a set of questions.  Customers answer by indicating their level of satisfaction. The most popular scale is one to ten, with one being the least satisfied and ten as the most satisfying level.

The result gives a business the necessary output whether or not to improve customer service right then and there.

However, the possible ambiguity might be a disadvantage, especially if a customer is dissatisfied with the service.

Why is CSAT important?

CSAT scores allow companies to look into how their customer feels in each interaction with sales agents. CSAT provides business leaders with two important pieces of information:

A detailed insight into customer success at every touchpoint of the journey Overall customer experience

Customer satisfaction scores enable businesses to determine the pain points in their service that impact the customer journey.

Addressing all these pain points and correcting them helps identify unhappy customers and turn them into happy customers, which increases the customer's lifetime value over time.

Buyers are also more likely to become repeat customers — and eventually, become loyal clients — if they have experienced an excellent customer experience in a particular business.

Moreover, because CSAT is measured through doing a customer satisfaction survey, as well as gathering feedback and online reviews, sales agents can do a deep dive into their customer base.

This means that they now have access and the capacity to understand what their clients need and want from any business.

What can you measure with CSAT survey scores?

CSAT survey scores can provide valuable insights into various aspects of your business's performance and customer satisfaction levels.

Here are some key metrics and areas you can measure using CSAT survey scores:

Overall customer satisfaction

CSAT survey scores provide a direct measure of customers' satisfaction levels with your product, service, or interaction. This overarching metric reflects the general sentiment of your customer base.

Product or service performance

CSAT scores can help assess how well your products or services meet customer expectations.

By analyzing CSAT scores for specific products or services, you can identify areas for improvement or areas of strength.

Customer support effectiveness

CSAT scores for customer support interactions indicate how satisfied customers are with the assistance they received.

This metric helps evaluate the performance of your support team and the effectiveness of your support processes.

Transaction experience

CSAT scores can measure customer satisfaction with specific transactional experiences, such as online purchases, in-store visits, or service appointments.

Understanding transactional CSAT scores helps optimize the customer journey and streamline processes.

Feature satisfaction

For products or services with multiple features or functionalities, CSAT survey scores can assess satisfaction levels with individual features.

This information guides product development and feature prioritization efforts.

Example of a customer satisfaction survey

A customer satisfaction survey is designed to measure how satisfied customers is with a product, service, or experience.

Here's an example of a CSAT survey:

Dear [Customer's Name],

Thank you for choosing [Your Company]! We value your feedback and would like to know about your experience with our [product/service/event].

Please rate your overall satisfaction on a scale of 1 to 5: Very Dissatisfied Dissatisfied Neutral Satisfied Very Satisfied Product/Service/Event: [Specify the product, service, or event] How satisfied are you with the quality of our [product/service/event]?

[ ] 1 [ ] 2 [ ] 3 [ ] 4 [ ] 5 Did the [product/service/event] meet your expectations?

[ ] Yes [ ] No How likely are you to recommend our [product/service/event] to others?

[ ] Not likely at all [ ] Not very likely [ ] Neutral [ ] Somewhat likely [ ] Very likely Please share any specific comments or suggestions you have about your experience:

[Open-ended text box]

Demographic Information (optional): Gender:

[ ] Male [ ] Female [ ] Prefer not to say [ ] Other: _______ Age group:

[ ] 18-24 [ ] 25-34 [ ] 35-44 [ ] 45-54 [ ] 55-64 [ ] 65+ How did you first hear about [Your Company]? How to calculate customer satisfaction score?

Measuring CSAT is pretty straightforward.

To calculate customer satisfaction score, you have to add the positive responses together, divide them by the total number of responses collected, and multiply by 100.

The outcome will give you the overall percentage of customer satisfaction in your business.

For example, if 50 people took part in your customer survey and 30 of them gave positive feedback — your CSAT score would then be 60%.

See here:

(30 positive responses / 50 total responses = .60 x 100 = 60%)

This indicates that while the majority of your clients are satisfied with your service, you can still improve it to better serve your customers.

The best time for measuring customer satisfaction is post-sales.

These times are especially crucial for repeat and new customers as the experience is still fresh in their minds.

What is a good CSAT score?

Now that you have your customer satisfaction score, the next thing to do is determine whether it is good enough to guarantee excellent customer service.

Is your numerical score enough to gain new customers and improve customer retention rate across the overall customer lifecycle?

While every industry has different standards for CSAT scores, high customer satisfaction scores usually fall between 75% and 80%.

Reaching this customer satisfaction rate means that three out of every four buyers had a positive experience with your brand.

While most companies would love to see 100% satisfaction in their services, that is rarely the case.

Additionally, the pandemic has certainly affected a customer's experience and happiness when purchasing a product or service.

Each buyer has his or her own opinions and standards.

Having customer conversations, hearing their responses, and gauging customer happiness regarding a product or service can help companies create new strategies that could improve customer satisfaction.

CSAT in outsourcing

Customer satisfaction score might be the simplest metric, but it’s a powerful tool for all businesses. It encompasses the whole customer journey and helps businesses determine the things that they should improve on to gain customer loyalty.

Measuring customer satisfaction is quick and easy. You add up all the ratings and divide the total score by the number of respondents. Most likely, you’ll get a percentage.

Get your customer satisfaction score a notch higher by outsourcing your customer service team. Check out Outsource Accelerator’s extensive list of outsourcing companies in the Philippines.

Strengthening customer loyalty with CSAT

Customer loyalty refers to buyers who always return to your brand for repeat business.

It is usually triggered by customer satisfaction, positive customer experiences, and the overall value of the goods or services a customer receives from a business.

A company's CSAT score evaluates the services of different brands and determines if your company is able to retain customers instead of losing them to competitors.

It also brings customer insights and user feedback so that businesses can strengthen their services.

It could be hard for business owners or sales representatives to identify unhappy customers from satisfied customers.

CSAT surveys assist in detecting customer satisfaction at the earliest stage of the customer lifecycle.

They allow companies to amend poor customer service and improve it before experiencing the worst-case scenario — an increase in customer churn rate.

Remember, customer expectations for a possible repeat business rather than losing them to competing brands.

Trust is a critical part of any business relationship, but finding the right strategies to improve it — along with your customer satisfaction — can be challenging.

There is more than one side to the customer satisfaction equation. The key to improving customer satisfaction is a healthy balance between understanding and improving performance internally while doing the same with customers externally.

Tips to improve your CSAT scores

There are a couple of tricks that you can use to improve your CSAT score and ensure excellent customer interaction all the time. Here are some of them:

Request customer feedback

The easiest way to gauge your market's reaction to your products or services is to ask them to rate their customer experience.

This can be done by handing out customer satisfaction surveys to post-calls or asking them for an online review.

A collected customer feedback will help you identify service issues and address them quickly so that you won't lose your clients' trust.

Meet customer expectations

Customers usually expect to gain whatever good things you have said about your business.

So, to keep them satisfied, it is important for your whole team to work hard to meet those expectations.

For example, if you say that your customer support call center is open 24 hours, then you have to put some of your staff on standby at all times for any inbound calls.

If you advertise a promo for a specific product, then you have to uphold it for every buyer.

Additionally, it is important to remain transparent with your consumers. From the time that they are still prospective buyers, you have to make sure that they already know what to expect from your brand and the policies that they will be agreeing with as paying customers.

Provide proactive customer service

If you want to boost customer satisfaction, you have to make sure first that you have a dedicated contact center for your clients. This contact must be personal, timely, and always pertinent to the user.

Reduce inbound calls in call centers as they increase agent effectiveness.

By offering customer service proactively, you can show the customer that good support does not only benefit the business.

CSAT vs. NPS vs. CES

CSAT is not the only key performance indicator that measures customer satisfaction.

Businesses also look into their net promoter score (NPS) and customer effort score (CES) to capture customer feedback and measure customer loyalty.

The net promoter score determines the likelihood of customers recommending your business to other consumers.

The higher your NPS score is, the bigger the chance there is for brand recognition.

NPS scores are usually measured using a one to ten rating system.

CES, meanwhile, measures customer sentiment on how well they have used your products or services.

The CES surveys aim to determine the ease or difficulty of customers deciding on purchasing your products.

What is What is business process outsourcing??

Business Process Outsourcing (BPO) is the delegation of business processes to an external service provider to a nearby or farther location. BPO uses various technology-enabled services to optimize the delivery of services.

Some of the usual outsourced business functions are the following:

Payroll Accounting Human resources Customer service Sales Marketing

In the case of content providers, these could mean hiring writers, remote editors, or virtual assistants.

BPO speeds up processes and enhances efficiency. Companies that outsource some of their business processes use their time on core services and competencies.

With this shift in focus, companies improve their current processes, which may result in improved customer satisfaction. BPO helps companies divert their resources to more critical business strategies.

Often, companies find it impractical to hire a full-time position in-house because of the cost associated with doing so. Outsourcing services can also help them save costs and resources in hiring suitable employees.

The definition of business process outsourcing (BPO)

In business process outsourcing, a company delegates its services to a service provider. It can be a local firm, nearshore, or offshore company.

Upon reaching an agreement, the service provider will then set up a team for their client. They will shoulder the costs and resources needed, including:

Office space Workplaces Connection Cloud storage IT infrastructure

The providers are responsible for tracking the staff's performance and progress. Meanwhile, the clients are responsible for providing the tasks, processes, and KPIs needed for their operation.

In some instances, they are also allowed to incorporate their culture and values into their team and absorb them as a part of their company.

What are the benefits of business process outsourcing (BPO)?

There are many benefits to outsourcing, as well as some downsides and risks.

Outsourcing powerhouses like the Philippines and India produce high-quality talent at a lower rate due to their low operational costs and full government support.

Since outsourcing companies hire and produce experts in the field, clients can ensure better results in their operations – whether in customer service, accounting, or marketing. Their staff are trained to ensure that their clients achieve the outcome they expect.

Companies are able to scale their staff depending on the demand and availability of their tasks. This also helps them improve their operations by letting their service providers contribute to streamlining their processes.

Outsourcing poses more growth opportunities for businesses of all shapes and sizes. While there are still drawbacks to this practice, it is safe to say that its advantages outweigh its risks.

To explain it further, below we have outlined the top benefits of outsourcing business processes:

Cost savings

Companies can enjoy savings of up to 70% by leveraging the salaries and costs in offshore countries.

In the Philippines, for instance, companies can hire offshore staff with a US$500/month salary for starting positions. A team of 10 employees would only cost them as much as a single worker in the US with an equal position.

Global market

Small and medium-sized businesses find it most difficult to hire local employees that suit their roles.

The widened skill gap in developed countries, paired with economic crises, affects their capacity to expand their teams as needed.

Businesses get to access a bigger pool of talent that can fit their requirements. They can have better options in hiring employees since they are not limited to what is available in their home countries.

Global presence

At the same time, outsourcing opens clients to global trade opportunities. They can establish their global presence and expand more easily to other locations since they already have operations in the area.

Flexible workforce

Outsourcing is a great way to establish a remote workforce, especially for companies looking to implement this setup for the first time.

BPO reduces internal local compliance obligations, including providing additional office spaces to employees. Instead, organizations can hold their business operations on a remote setup, most usually having their teams in an office provided by the BPO firm.

Leverage skill

Companies cannot always do everything on their own. Burnout within entrepreneurs and teams is more common than everyone thinks, especially with everyone filling up the tasks beyond their skill sets.

A BPO company enables them to leverage the skills of other specialist companies on more complex tasks such as accounting and IT.

Focus

Lastly, BPO enables organizations to focus on their core business functions. This is because most of their non-core business operations are done with the help of a reliable service provider.

Business process outsourcing examples

The BPO industry is vast, generating over $200bn annually and employing millions of people worldwide.

As stated in the Market Analysis Report, the global business process outsourcing market reached over USD 245.9 billion in 2021. Thus, it is foreseen that we will acquire a compound annual growth rate (CAGR) of 9.1% this year from 2022 to 2030.

The proliferation of the global BPO sector is utterly driven by several key factors that organizations take full advantage of:

Improved efficiency and agility Focus on core competencies Decreased operational costs Adapt to the ever-changing business dynamics

In general, when we speak of outsourcing, it always entails contracting out parts of business processes to an external provider, either domestically or offshore.

BPO can be seen in different forms and contexts, from hiring single staff to getting an offshore team.

Here we have listed some of the examples of business process outsourcing:

Big enterprise

Corporate outsourcing has been around since the industry started. The new breed of large companies are still taking advantage of its benefits and using it to expand their offerings further.

Some of the known enterprises that outsource their services today include the following:

Google. Google has been ramping up its outsourcing efforts since 2016 by delegating development and customer support. Facebook. Meta, particularly Facebook, outsources content moderation to the Philippines as a way to filter toxic content and keep the platform safe for its users. Wells Fargo. Wells Fargo has been outsourcing their operations to the Philippines since 2011. It has recently pulled out its functions in the country, though the company retained its BPO center in Manila. Medium-size businesses

A medium business with 50-500 staff might outsource the labor-intensive accounting and finance functions to a team in the Philippines.

Small business and entrepreneur

The recent Clutch survey stated that around 90% of small businesses plan to outsource their services in 2022 due to the efficiency and flexibility that companies get.

It is common for small business owners to have a Virtual Assistant (VA) working for them full-time and remotely from the Philippines.

Aside from this, organizations can delegate other services such as development, IT, and digital marketing.

What are the different types of BPO?

Outsourcing can be executed in different forms, depending on the outsourcer's needs. The truth is that not everyone is fully aware and has an in-depth grasp of the BPO sector.

For most people, BPO can simply mean farming out business processes to third parties located in another country, but this is just one type of BPO.

As for businesses, it is always vital to be familiar with the various classifications and functions of BPOs. This way, they are able to opt for a business process outsourcing provider that is best suited for their type of requirements and industry.

More importantly, outsourcing is not a one size fits all strategic approach, this is why it is not enough just know what outsourcing is and how it works.

There are several types of BPOs that businesses can choose from. The type of business process outsourcing can be characterized by its specialization, location, and size.

Generalist or specialist BPOs

Business process outsourcing is in the human resources and professional services sector.

However, their services extend across all industries. The majority of BPOs are generalists in that they offer a full range of professional services.

Meanwhile, some specialize in certain verticals, such as the following:

Legal process outsourcing

Legal process outsourcing deals more with delegating legal processes and compliances to legal firms in another area.

Knowledge process outsourcing

Meanwhile, knowledge process outsourcing enables companies to outsource knowledge-related work, including research and development, innovation, and creativity.

Location

Business process outsourcing typically operates from developing nations such as the Philippines, India, and Colombia. They typically have cheaper cost of living and bigger populations. Different locations offer different advantages.

Size of BPO

The bigger BPOs employ more than 250,000 people. They are huge, global operations. Medium-sized BPOs range from 500-5,000 staff and offer a full range of services. The smaller BPOs might have 1-500 people.

Offshore

Offshore outsourcing refers to the process of delegating a part of operations or a department to an offshore country.

To maximize profitability and efficiency, companies choose to outsource to a different region or timezone. India, the Philippines, and South Africa are some of the popular countries known for offshore outsourcing services.

Onshore

Onshore outsourcing or onshoring, meanwhile, is preferred by firms looking to delegate their services within their country.

Onshoring does not offer as much savings as offshoring or nearshoring. However, clients prefer this as a way to maintain their branding and satisfy their local markets.

Nearshore

Lastly, nearshore outsourcing is preferred by companies that do not want the hassles of time zones and cultural differences in offshoring but still want to get the best out of their delegated services.

Through nearshoring, businesses can collaborate with their teams located in nearby countries. This gives them the opportunity to maintain their local compliance and save on costs since most nearshore locations are cheaper than their onshore counterparts.

Functions of business process outsourcing

Collectively, business process outsourcing provides any kind of staffing solution. Common functions of BPO include:

Finance and accounting

Outsourced finance and accounting services help businesses manage their books, monitor cash flow, and keep up with corporate income tax compliances without fuss.

Healthcare

Healthcare outsourcing, meanwhile, organizes various back- and front-end functions for the healthcare and insurance industries.

Creative and content

Creative services outsourcing covers everything from post-production of Hollywood movies to newspaper and website content.

Tech, IT and development

IT outsourcing involves delegating network management, web and app development, and cybersecurity protection to IT firms in different countries.

Sales & customer support

Some BPO providers specialize in sales and customer support for pre- and post-sales transactions. This helps companies meet the expectations and demands of their customers, keeping them satisfied even after their purchase.

Marketing

BPOs and marketing firms can help in ongoing marketing, communication and branding activities for their clients. This helps them attract more suitable leads in a cost-efficient way.

Talent and HR

Businesses can delegate HR, recruitment, and compliance to professional employer organizations to maximize recruitment and workforce management.

Administration

Generalist BPOs help organizations accomplish general business administration and operational activities. This includes data entry, appointment setting, and other related functions.

Supply chain management

Lastly, e-commerce stores benefit from outsourcing supply chain management to manage warehouse and delivery processes.

The future of BPO outsourcing

We have gathered five expert opinions from renowned global business leaders. They shared how they perceive the future of outsourcing will be, including the trends that will prevail in the coming years.

Meg Marrs, Safer Senior Care

Meg Marrs of Safer Senior Care strongly believes that entrepreneurs and business leaders should outsource their essential tasks.

“Outsourcing certain roles has freed up my time to focus more on big picture strategy, rather than being completely meshed in the day-to-day tasks.” 

One thing is certain, outsourcing to support businesses growth is something that will never go out of trend.

Sean Nguyen, Internet Advisor

As for Sean Nguyen, Director of the Internet Advisor, outsourcing to streamline processes is another essential trend that businesses will continue to apply.

He quotes, “Outsourcing can be really helpful, even at the most incipient levels, because it allows you to streamline operations. If it's not essential to have it taken care of in-house, there is no reason to do so.”

Elandas Miller, Kicking It Sports

Elandas Miller of Kicking It Sports, has been outsourcing back office and creatives since 2017. “I like to think of outsourcing as a tool to help me get to my goals faster and more efficient without burning myself out.” 

Outsourcing to support both organizations' short and long-term goals is another trend that companies will practice in the foreseeable future.

Tom Baker, Tom's Projects

The founder of Tom's Projects, Tom Baker, offshores his entire product and development. “Outsourcing means that we can scale the team up and down when need be.” Scaling the workforce through outsourcing is, yet again, among the trends that will remain prevalent.

Bobby Reid, Capitol Tech Solutions

For Bobby Reid, founder of Capitol Tech Solutions “Outsourcing has helped our business by being able to provide expertise for a service quickly. While these contracts are outsourced, they are incorporated into our company culture when possible, since they are working full time with our firm.” 

Lastly, outsourcing to fill in talent gaps and expertise is one of the key trends that more and more organizations will utilize in the coming years.

The future of work is digital, says Outsource Accelerator Founder and CEO Derek Gallimore.

The world has moved on from manufacturing and creating products to providing services. And as we enter the post-pandemic world, he says we are “moving towards a single global economy.”

The concept of work dramatically changed with COVID-19, and things have changed for good. These changes made us realize that technology is available for remote and digital work interfaces.

Once showed an unsteady growth, the global outsourcing market spiked to US$245.9 billion in 2021. The sudden surge of demand brought by the pandemic, along with the worsened talent shortage, has led companies to increase their outsourcing efforts.

In a podcast episode, Derek explained, “There are eight billion people on the planet, and they are now all increasingly connected digitally.

There are [also] four billion people who are highly qualified professionals sitting around the world, and they're not just virtual assistants and basic roles. You can find [people with] PhDs, architects, accountants, or whatever you need for your business.”

To conclude, Derek believes that the global economy and a globally-sourced workforce are the future, and it is not going away.

Leaders all over the world also know that outsourcing is here to stay. Former US President Barack Obama says that jobs that have been outsourced cannot be brought back to the country.

As a result, it is better to retrain and re-skill the workers who have lost their jobs on account of outsourcing.

Obama further suggests that community colleges could provide the necessary skills for a person to be gainfully re-employed in the workforce. He adds that this is a necessity that Americans look forward to in the future.

Looking back doesn't always make people feel good, so it is essential that they retrain for the ‘jobs of the future.'

How to choose a BPO provider

Over the years, outsourcing has been the go-to strategic practice for businesses looking to scale their operations effectively.

But just like any other venture, companies should be wary of the possible drawbacks of outsourcing before selecting bpo providers.

Risks of BPO outsourcing 

Despite its advantages, business process outsourcing done incorrectly leads to outsourcing risks that affect a company in one way or another.

Hidden charges

Some BPO vendors do not totally disclose the total fees they charge and their terms. Clients could experience “bill shock” upon seeing the hidden charges they get.

Compliance issues

Compliance is crucial, especially in handling financial information and dealing with intellectual property. BPOs that violate compliances could risk their clients' reputations and branding.

Problems with security

Lastly, BPO vendors with loose security compliance could risk getting their client's data exposed and used for malicious purposes.

Choosing the right business process outsourcing vendor

The key to successful outsourcing lies in choosing a suitable bpo company and working with them along the way. Here are some of the considerations to look for in a BPO vendor:

Expertise

A BPO vendor's expertise can be shown primarily through their approach to their clients. Even without getting too technical, they can comfortably discuss the initial solutions to provide according to their client's requirements.

Compliances

Especially when delegating functions involving sensitive information, a bpo company should be up-to-date and compliant with regulations relevant to their services.

Check for ISO, HIPAA, and PCI certifications as much as possible.

Employee satisfaction

A good BPO company also places employee satisfaction as its priority. Check on employee reviews online to see how the staff feels about their company.

Technology

The tools and equipment a BPO vendor uses largely affect their performance in general. Check to see if they use updated technology at work and how they train their employees to use them.

Top BPO companies in the world's top outsourcing hubs

A wide range of business process outsourcing companies in different parts of the world provide the utmost services to their Western and local clients.

Many of them even earned recognition by award-giving bodies due to their performance in both their roles and their level of care for the employees.

Check out the top BPO companies in several outsourcing destinations below.

Top BPO companies in the Philippines Top Indian BPO companies Top South African BPO companies Business Process Outsourcing (BPO) services

With the rise of new offshore outsourcing locations, companies can have better options in terms of location and services they can delegate.

However, finding a suitable BPO company can be a daunting task to be done on their own.

It's a good thing advisory services such as Outsource Accelerator are there to help them.

Outsource Accelerator is the most trusted source for independent information & advisory for Business Process Outsourcing (BPO). We have over 5,000 articles, 400+ podcast episodes, and a comprehensive directory with 3,000+ BPOs from different locations.

Outsource Accelerator's offerings make it easier for clients to learn about and engage with business process outsourcing companies worldwide.

Want to learn more about outsourcing? Check out the Inside Outsourcing book as well as the Inside Outsourcing book review today!

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About OA

Outsource Accelerator is the trusted source of independent information, advisory and expert implementation of Business Process Outsourcing (BPO).

The #1 outsourcing authority

Outsource Accelerator offers the world’s leading aggregator marketplace for outsourcing. It specifically provides the conduit between world-leading outsourcing suppliers and the businesses – clients – across the globe.

The Outsource Accelerator website has over 5,000 articles, 350+ podcast episodes, and a comprehensive directory with 2,300+ BPO companies… all designed to make it easier for clients to learn about – and engage with – outsourcing.

About Derek Gallimore

Derek Gallimore has been in business for 20 years, outsourcing for over eight years, and has been living in Manila (the heart of global outsourcing) since 2014. Derek is the founder and CEO of Outsource Accelerator, and is regarded as a leading expert on all things outsourcing.

“Excellent service for outsourcing advice and expertise for my business.”

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