Business process outsourcing (BPO), the delegation of an organization’s department (or part of its department) to a specialized third party, has surged in growth since the 1980s. And according to new projections by business consulting firm Grand View Research, the industry will surpass the $400 billion mark by 2028. In this article, we observe the traditional BPO experience, understand the challenges faced in the BPO customer service industry, and examine the role of Artificial Intelligence and Machine Learning technology in solving these challenges.

A brief overview of Traditional Business Process Outsourcing (BPO)

The global market size for outsourced services in 2019 was valued at 92.5 billion USD - Statista Research Department

Ever before the Covid-19 pandemic thrust the concept of remote work into the public lexicon, many organizations routinely engaged with vendors beyond their geographical location, as shown by Statista’s pre-Covid analysis. This working arrangement, typifying a business process outsourcing model, involves subcontracting processes outside an organization’s core expertise and where internal capabilities prove inadequate or too costly to maintain. The third-party vendor (to whom the process is subcontracted) has demonstrably higher know-how and process-specific clout and, as a result, adds a marked degree of efficiency to the business process. Their presence will also allow the organization to channel time, effort, and human resources to its core value propositions - increasing its market competitiveness and ability to scale.

In the traditional BPO model, the outsourced company uses manual, conventional workflows to deliver the BPO experience. They have staffed employees who integrate with the ‘parent’ organization and perform required tasks without modern technological aids or support. Although sufficient in small-scale organizations with undemanding use cases, this model inadequately caters to the requirements of modern businesses as it does not support continuous innovation.

In the next section, we will go through some challenges of traditional BPO, as it relates to outsourcing customer service

Challenges in the BPO industry

Lack of specialized support: Two major reasons why organizations outsource customer service is to increase the efficiency of the process and allow their strained agents to focus on other tasks. . None of which will occur if the work of the third-party vendor is snail-paced or riddled with inaccuracies. This is commonplace in traditional BPO models where the (often) administrative nature of customer service tasks easily leads to human and organizational errors. And as customer service is a front-office function, the consequence of error is instant customer dissatisfaction which will likely translate to the customer going somewhere else.

Limited use of technology: Without technological infrastructure, humans cannot swiftly analyze customer data and related metrics to obtain timely insight that guides the formulation of impactful product, sales and marketing strategy. On account of this, new ‘opportunities’ can be left unharnessed and problems that can ruin customer relationships may not be detected in time to forestall their occurrence.

Chaotic handovers: Another challenge in the BPO customer service industry arises when an organization chooses to discontinue the outsourcing agreement/ re-outsource to another vendor but finds it difficult to reabsorb the process internally or integrate the new vendor. This can be caused by a mismatch in technology (lack of integration capabilities) or plain disorganization and ‘ customer management chaos’ stemming from poorly categorized and sorted information.

Linguistic deficiencies: As befitting a ‘global village’, customer experience must be seamlessly multilingual to cater to the world’s languages. A multinational organization that has outsourced its contact center shouldn’t have prospects get unsatisfactory responses simply because the operator doesn’t speak their native tongue. And the contact center vendor shouldn’t have to employ staff for each of the 7100+ languages in the world! Nevertheless, linguistic deficiencies are unavoidable if appropriate technological infrastructures are absent.

Poor security infrastructure: When an organization delegates customer service to an outside vendor, valuable data about customers including their contact information, bank details and product preference is no longer within its full security umbrella. Subsequently, the organization is at risk of malicious actors who can exploit vulnerabilities in the vendor’s network to breach this information. Depending on the digital transformation/ level of integration, a single breach may have wider ramifications - creating a pathway for the attacker(s) to access even more customer-related data relating together with core functionalities of the organization’s business. Incidents like this are widespread with the traditional BPO experience where the absence of robust data security does little to dissuade data theft.

How Artificial Intelligence and Machine Learning delivers an unmatched BPO experience

Artificial Intelligence (AI) and Machine Learning (ML) are the key drivers of innovation today. And when fused with the business process outsourcing model, these technologies usher in operational excellence and outstanding agility that help organizations reach the zenith of BPO fulfillment.

Obtain Real-time Analysis and Insights: AI facilitates real-time data analysis - spotting patterns across huge caches and providing insight for customer relationship management and decision-making. The technology automatically scans through historical data archives and flags any ‘eureka’ that when contrasted with current data capture will provide a clearer picture of the business’s customer service , past or present. The garnered insight can be resiliently stored on the cloud from where they can easily be accessed with deep search and meta descriptions.

Transform customer service: AI in customer service – via programmable chatbots – can hold intelligible conversations with prospective customers, no matter the language or tongue! This feature streamlines any contact center and adds considerable value to the customer experience. Also, as cybercrime nowadays is mostly AI-enabled, a business AI is necessary to act as the first line of defense that monitors and extinguishes threats before they occur.

Significantly reduce cost: The elasticity of an AI-enabled customer service experience allows organizations to reduce their office footprint including the salaries and training costs for human customer service agents. Besides providing tremendous insights (organizations can leverage this to reduce cost in the long run), an AI establishes automated workflows that fosters greater productivity in the workforce. The consequence is that fewer staff - working with bots and other automated technology can produce superior results compared to a larger ‘unautomated’ workforce. And the bots, once installed, don’t have to be paid!

Automate manual tasks and free valuable time: AI can perform monotonous (and typically boring) tasks that are likely to induce errors, allowing humans to focus on making correct data-based decisions via AI-generated insights. The AI performs these monotonous tasks with greater speed and efficiency than human customer service agents can muster.

Key Takeaways

Business Process Outsourcing is when an organization subcontracts an aspect of its operation to a third-party vendor

In the Traditional Business Process Outsourcing model, the vendor’s workflow is manual and their workers are not provided with modern cutting-edge technology.

This model is inadequate in keeping with modern business requirements in customer service and has several challenges that hinder the vendor’s ability to perform effectively, negatively impacting the outsourcing organization.

Using Artificial Intelligence and Machine Learning technology, BPO vendors can provide a quality BPO experience with capabilities to obtain real-time analysis and data insights, transform customer service and automate manual tasks.

Experience the difference a smart BPO can make with Inflection

Inflection offers AI-powered BPO services for businesses to transform their stakeholder engagement. Our team of highly trained professionals utilizes Inflection’s AI software stack to deliver cost-effective, superior experiences to businesses and our agents are trained in voice and multi-channel support that transforms the customer experience. Moreover, bolstered by massive infra savings, our smart BPO can perform tasks with a far lesser workforce than traditional solutions, helping businesses to save money.

Contact us today to explore how InflectionCX can help you deliver superior experiences within your budget!