Survey Finds Small Business BPO Stagnating

Business process outsourcing, or BPO, and the practice of looking beyond American shores to find ample arrangements, have led to the proliferation of the establishment of offshore contact centers in the past ten years.

While it has become almost commonplace to speak with someone on foreign soil when calling the company just down the street, this practice may be slowing. Considering the backlash from customers and the general public, many companies still found significant benefits to offshoring their contact center operations.

According to a survey conducted by Access Markets International Partners (AMI Partners), midsize businesses appear to be stagnating in their adoption of business process outsourcing.

The survey compares BPO figures from three years ago with current figures. Upon this examination, AMI Partners came to the conclusion that midsize businesses – or companies with 100 to 999 employees – have shown static use of BPO. Over a three-year period, these businesses held at roughly 60 percent. 

"The lack of momentum in BPO usage implies that midsize businesses' wants and needs -- such as improved processes, turnaround time, and cost-cutting goals -- are not being met," said Melissa Chong, an AMI Partners research analyst, in a statement.

"Midsize businesses in the U.S. have over the years reported revenue growth of 7% to 8%, slightly higher than actual GDP growth. In addition, the need for cost control and decreasing operating costs is of high concern among U.S. midsize businesses."

AMI Partners noted that in its research three years ago, it found that 97,000 U.S. midsize businesses did some level of BPO. That percentage remained roughly the same at 60 percent of the 99,000 similar-sized businesses surveyed recently.

Chong noted that primary selling points for midsize businesses included cost control and obtaining greater efficiency in non-strategic processes. She also highlighted that these businesses didn’t seem to be reacting to those benefits.

This research from AMI Partners also found that just 3 percent of these companies were using BPO front-office outsourcing such as customer support and call centers. Back-office functions such as payroll and accounting seem to be the most common business processes that are outsourced.

AMI Partners also pointed out that most of the outsourced services are carried out onshore, with just an estimated 5 percent using offshore outsourcing operations. Perception would certainly have the consumer believing that this 5 percent is a little low. However, it is possible that the major push for offshoring has come from larger companies in smaller numbers.