Global competitiveness is at its highest and it keeps on increasing day by day. It is hard for small to medium businesses to keep up with huge corporations. Good thing, outsourcing is accessed easily.
Back office support helps balance the uneven distribution of talent all over the world. It helps companies, especially start-ups, communicate and work with the best employees they need all over the globe. With the shortage of talent pool in other countries and too much in some, outsourcing back office support is the answer.
Examples of back office support
- Accounting and Finance – this includes internal audit, payroll processing, accounts payable processing, loan and credit card debt collection, and many more.
- Information Technology Solutions and Services – this includes software developers, web designers, and application developers.
- Human Resource – this includes recruitment, employee service center, workforce administration, employee data management, payroll, talent management, and many more.
- Virtual Assistants – when a company outsources VA, they are usually writers, SEO specialists, digital marketing assistants, social media specialists, and web developers.
- Data Management Services – this back office support is consist of data entry, data processing, data mining, and data cleansing.
- Forms Processing – this service includes processing of opening forms, medical forms, survey forms, shipping forms, mortgage forms, legal forms, insurance forms, tax forms, and many more.
How back office support helps businesses achieve success
There are tons of advantages outsourcing back office services can give a company. Here are some of the examples:
With regards to cost cutting, one of the best examples is the famous chatting application WhatsApp. It only had 30 full-time employees and five part timers. They then decided to get back office support to fully develop their company and launch the app. They outsourced IT service, developers to be exact, from a company in Eastern Russia as Russians are known to be great engineers, stated their co-founder, Jan Koum. Their in-house employees are focusing on customer service and operations while the offshore company develops their app.
Another advantage is flexibility. Citi, Bank of America, Barclays, Goldman Sachs, and J.P. Morgan has decided to outsource their IT tech to different countries like the Philippines, India, and Poland.
One of the best start-up success stories related to outsourcing back office support is Klout. Their founder, Joe Fernandez, has offshore development to Singapore. He outsourced a bespoke developer and stayed with them for four months just to make the original version of the product. After four years, from $200,000, his company garnered $40 million funding because of the product. He then sold Klout to Lithium Technologies for $200 million in 2014.
However, it is also important to note that you need to hire the best company to fit your standards and work. One example of failure is IBM’s attempt to create Health Payroll System for Queensland. Up to this day, there is an ongoing battle because of the 20,000% cost overrun. It is also one of the famous outsourcing disasters.
Another outsourcing disaster is when Deloitte tried to outsource an IT service back in 1996. It took 19 years of what should only be five, to build the project. Deloitte is also famous for other failed outsourcing projects like the tax collection system. It has encountered more than 1,000 defects. Another one is an unemployment claims system. It was two years overdue and has consumed more than $6 million the promised budget, and in the end, after it was finished, encountered multiple errors.
It is important to note that not every company needs to outsource their back office. However, there are many out there that need to do it. They just need to find the right company to team up with.
Contact us if you want to know if we are the right company for your back office support!
