Is BPO the Same as Shared Services?
When it comes to choosing between Business Process Outsourcing (BPO) and Shared Services, there are many different factors that require consideration.
For instance, companies are often undecided whether they should choose shared services or acquire an outsourced accounting service in Singapore.
The purpose of this article is to thoroughly discuss the various aspects of BPO and shared services so that companies can make a well informed decision.
What is BPO?
Because BPO employs professional methods and practices, it is frequently perceived as being more effective. Since it is an outsourced service, the cost involved can be a lot lower. Outsourcing is frequently carried out more quickly and effectively as a result of the expertise and resources of the BPO providers.
Moreover, choosing BPO can increase employee satisfaction and motivation, leading to higher employee retention. You hired great talents to help you expand your company, and by outsourcing certain duties, you allow them to focus on what they do best.
When given the opportunity to pursue their passions, employees will be happier and report greater levels of job satisfaction. This will definitely improve talent and employee retention.
Using shared services may be a preferable choice if your company has special requirements. Since BPO is frequently one-size-fits-all, a shared services model may be your best bet if you have unique requirements and non-standard operating practices.
However, the implementation of a shared service function within a business can be time-consuming and difficult.
The most common reason for this is a lack of internal competence in handling the tasks, not to mention the difficulty in hiring the right candidates for the right job function.
Therefore, companies must identify and understand the specific requirements they have before making a decision between BPO and shared services.
Let’s look at the differences between BPO and shared services in detail.
BPO vs. Shared Services
The process of BPO involves contracting with an outside supplier (for instance, an outsourced accounting service provider in Singapore) that has the tools, know-how, experience and technology to carry out your work on your behalf.
On the other hand, shared services refer to the creation of a single, independent business unit to provide services that are simultaneously required by several divisions of an organization.
BPO is often attributed to producing increased productivity for the company since the external provider can facilitate improved processes and practices and carry out the required job functions with greater focus and efficiency.
It is a trend that more and more businesses, from small to large organizations, are outsourcing their operations.
These include areas such as data entry, accounts processing, budgeting and forecasting, payroll, staff placement, customer care, and more. Companies outsource for numerous reasons, including reduced operational costs, trained staff, specialized skills, and advanced tools.
In fact, rarely does one organization assume responsibility for all processes for a particular function.
For instance, when a business outsources its Human Resources function, payroll and recruitment may be included. However, Human Resources encompasses much more than these processes.
Thus, most often than not, organizations would still retain parts of the job function, such as HR strategy, compensation administration, benefits administration, and other related functions in the example above.
Due to their unlisted nature, shares and bonds that are not traded on regulated exchanges are subject to additional risks. These dangers include:
BPO can be an ideal choice for you if your needs entail standard procedures that do not involve the internal variables of your business.
On the other hand, shared services could be your best choice if you wish to take special needs into account and manage time and resources appropriately.
To make the best decision, it is recommended to also factor in your organization’s goals, general management support, and internal procedures.
Last but not least, you could acquire the professional advice of an expert accounting service provider in Singapore to help you decide better.