Setting up a BPO involves selecting a specialty, building expertise, and implementing a system to deliver excellent performance. The setup of BPO largely depends on whether the business owner wishes to provide an offshore or offshore service. An offshore BPO setup must comply with the regulatory environment of the host country.
Setting up a business process outsourcing (BPO) company involves selecting a specialty, building expertise, and implementing a system to deliver excellent performance. Functionally, the process involves many of the same activities as building any service-oriented business. If the BPO intends to operate in a foreign country, however, it will have to navigate the regulatory environment in both the owner’s home country.
The setup of BPO largely depends on whether the business owner wishes to provide an offshore or offshore service. In nearshore outsourcing, both the business client and the BPO provider are located in the same country. For example, a US company may outsource its payroll processing to another US company. In offshore outsourcing, the business client is located in one country and the BPO operation is set up in another country, even if the BPO provider is also operating in the client’s country. For example, a UK company might outsource its telephone customer service to a call center in India.
Either way, a prospective BPO vendor develops a plan and secures funding. Operationally, the owner registers the business with the appropriate government agency, secures a location to operate the business, employs and trains workers, and purchases equipment and other resources to operate the system. This basic BPO setup becomes much more complicated, however, if the owner wishes to establish an offshore operation. An offshore BPO setup must comply with the regulatory environment of the host country, registering and setting up operations there. Locally owned BPOs in host countries need to do the opposite and learn how to operate and recruit clients from countries like the US and the UK.
The unique parts of setting up BPO involve specialty, expertise, and excellence. First, an entrepreneur must determine which business process to target. Some BPO areas are saturated with providers, while others are still in their infancy. Secondly, the owner of the business should be a recognized expert in the selected specialty. Participating in trade groups and writing articles for publication will determine an owner’s business acumen with the target process.
Finally, the new BPO vendor must have a system developed to deliver the service that ensures excellent performance without excuses. This system is the company’s product and must be designed and packaged before soliciting customers. If the BPO setup seems complicated or if the owner does not have the necessary skills in an offshore country to set up operations, he can hire a consultant or facilitator who specializes in opening new BPO companies to smooth the way.
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