Does BPO mean Bad Practice Only?

Business Process Outsourcing: a leading business strategy

BPO consists of outsourcing, subcontracting subsets of business-related operations and responsibilities to external parties. Business Process Outsourcing (BPO), as a company strategy, has soared in the last decades and is now a mainstream strategy used by firms of all sizes. Though outsourcing can be seen as a natural extension of free trade in a globalised economy, many talk of a “BPO revolution”. According to Statistica.com, in 2017, the global market size of outsourced services was valued at 88.9 billion U.S. dollars (with an increase of 12 billion dollars from the previous year).

BPO: a competitive market positioning

BPO provides:

• competitive market positioning and optimizes organizational strategies in terms of flexibility and security.
• It is an adaptable and tailored solution that corresponds to firms’ individual needs and resources.
• The primary reason companies adopt BPO is to reduce costs.
• Though, due to combined resource pools, BPO also increases company knowledge and customer-experience.

BPO: a topic for controversy

BPO is not at rest from critics and naysayers who state that BPO is synonym of corporate irresponsibility. 

BPO is criticized for:

• the unethicality of business practices abroad
• asymmetrical relationships with partners
• lack of respect of quality standards of business process and products.

Employment, for example, is at the heart of critiques. Seeking lower costs, companies mainly outsource in developing countries. Employers’ ethical obligations towards employees are notoriously controversial. BPO is portrayed as a contributing factor to socio-economic disparity due to poor labor conditions and low-wages. 

Companies who outsource are also scrutinized for contributing to the lack of employment in domestic labor markets, by focusing merely on profit – with little concern for overall socio-economic well-being. 

So…To BPO or not to BPO? The answer: Sustainable BPO with TGS

TGS is seeking to increase awareness around responsible business practices and ethical BPO in particular. Our member Howlader Maria & Co in Bangladesh has engaged in developing ethical practices internationally. This member firm is specializing in sustainable BPO and has made great progress.

Our aim, as a network, is to promote win-win business models. BPO results in a more interconnected and integrated business world where we can create prosperity for all. Ethical BPO will reduce costs, and ensure competitive positioning, while following ethical and sustainable practices that will positively impact our society… the best of both worlds.