The Business Process Outsourcing industry
“Business Process Outsourcing (BPO)” refers to the contracting out of certain business functions or departments of your company to third party handlers. The BPO industry as we know it today grew from the need of organisations to cut costs and reduce their dependence on in-house resources. Hence, large departments would be outsourced to other locations or markets where they are more affordable at scale. This is why the industry is also referred to as “Outsourcing and Staffing”.
Colliers reports that despite a downturn during the Covid-19 pandemic, the global BPO industry grew to an estimated value of $164.7 billion in 2022, and is expected to reach over $380 billion by 2030.
Types of BPOs
In 2021, Deloitte recorded that the most commonly outsourced services include IT, finance, payroll, and customer service (also referred to as “contact centres” or “call centres”). Other BPO services include: data mining and input, software development, transcription. animation, game development, and more.
BPO Growth Markets
Globally, India remains the largest BPO industry in terms of sheer size. It is closely followed by the Philippines, and the US.
India remains a premier destination for BPOs for its IT expertise and well-oiled BPO-ready infrastructure. On the other, the Philippines is the fastest growing BPO industry of the last decade. This is attributed to Filipinos’ culture of warmth and politeness, resulting in good soft skills and customer service. The Philippines also has a strong command of the English language, as it is part of the national educational curriculum. This makes the Philippines a go-to for contact centres and support BPOs. The Philippine government also continues to encourage BPO industry growth through legislation that supports and draws more investment to the local industry.
What makes BPOs different from other industries?
The nature of BPOs creates a strong focus on their workforce per se.
High volume of workers
BPOs employ high volumes of workers for roles including voice customer service, non-voice customer service, IT services, and data entry among others. These roles in turn process high amounts of calls and requests daily. In addition, BPOs hire for round-the-clock shifts in order to cover calls and requests from countries on both Eastern and Western hemispheres. Hence, many BPOs hire for multiple shifts: Day shift, mid shift, and night shift.
The advent of remote BPO work
The industry is also facing radical changes in the wake of the Covid-19 pandemic, where more BPOs are allowing remote and hybrid working conditions, as opposed to traditional in-office work. While this may seem a common issue for all employers across industries, BPO managers and team leads face the particular challenge of applying hybrid employee management for very high volumes of workers across shifts. Adding the complexity of hybrid and asynchronous work requires much more effort, adaptability, and well thought-out recruitment and management structures to ensure no loss in work quality and client service.
Recruitment, training, and churn
Many BPOs may also be prone to high churn rates. This is the rate at which current employees leave the company and must be replaced by new ones. Some hires may be found wanting during the necessary post-recruitment work training. Others may realise that they are unable to work at the shift they were hired for after just a short stint. Turnovers of employees is absolutely normal in any industry. However, high churn rates can be costly and affect a company’s capacity to serve their clients well. New hires must be trained from the ground up, and it takes time before they can be deployed.
These are just several of the many considerations that may make the BPO industry challenging for employers. Entering and thriving in the post-pandemic outsourcing world means strategizing intentionally for talent acquisition and management to avoid losses and optimise gains.
Designing your BPO Recruitment Process: Considerations and Best Practices
What are some of the nuances to consider and best practices to implement when creating your BPO recruitment strategy and process?
1. Recruiting and verifying high-quality candidates
BPOs need skilled workers who can advocate two business objectives at the same time - that of the BPO itself, and that of the BPO’s clients (who might be from different countries and industries from all over the world). BPO workers must be highly trainable, and high performing.
One way of ensuring that you hire the best candidates is by putting more effort into checking and verifying candidates’ credentials. If they look high-quality on paper, take the next step to make sure they truly are. Low quality candidates are more likely to perform poorly, or leave the company sooner, and become an immediate expense rather than a long-term asset.
Including comprehensive background checks to your recruitment process will allow recruiters and employers to know the truth about candidates beyond what is on their CV. Whether they are truly skilled enough to carry out the work; whether they have any history of crime or other issues that the organisation must know about; and most importantly, whether they are trainable, and a good culture fit for the BPO.
Read more on BPO background checks here.
2. Prioritising and planning ahead
Another way to reduce churn is by taking the time to pre-empt your hiring needs in terms of skills and roles. Rather than reacting to roles that become vacant, the hiring team must have an awareness in advance of which roles are most critical for operations. These are the ones to prioritise in times of turnovers, or even rapid expansion.
Planning ahead allows HR teams to identify which roles and skills to hire for to reduce strain on a team that is rapidly growing, versus what roles are less urgent.
3. Automating and leveraging technology
It may seem counter-intuitive, but busy organisations may easily overlook the benefits of automating parts of the recruitment process for speed and efficiency. Technology solutions are available to outsourcing and staffing companies to speed up their recruitment process while providing a better candidate experience.
A key example is Veremark’s background screening and pre-hire check service. This allows BPOs to choose which background checks are critical for their hiring process, and utilise screening software designed specifically for the outsourcing sector for quick, reliable results. Through an easy-to-use, integration-ready platform, recruiters and HR teams can order, manage and review their candidate checks from their in-house system. This reduces the burden of having to run background checks manually, or learn complex new platforms.
4. Creating a positive candidate experience
Of course, do not forget the candidates’ experience. The many potential workers of all ages and backgrounds approach your BPO seeking gainful employment, whether as first-time workers, or experienced candidates for leadership roles. Show them that your BPO takes candidate and employee experience seriously, and they will be more likely to reward you with cooperation, honesty, and hard work in return.
Throughout your recruitment and background check process, always communicate openly with them about what to expect, what processes require their consent, and answer their questions in a timely manner. Read more about creating Transparency in your Recruitment Process here.
Recruitment in the BPO sector is a world of its own. BPOs operate and hire differently compared to other multinational corporations.
Understanding the nuances of BPOs and BPO workers should allow employers to design their recruitment process around the specific needs of the industry, and their potential hires.
Automating the aspects of the hiring process such as background checking and verification will help BPOs build and maintain a fast-moving yet efficient process that should lead to better hires, faster, and of course, bolster business.
Request a discovery session with one of our background screening experts today.