Home » Investments » Outsourcing: The Rise of Business Process Outsourcing in America

In the past decade, globalization has led to a dramatic rise in outsourcing. With many American companies needing to keep up with their competition abroad, they have turned to offshore business process outsourcing as a way of lowering costs and increasing efficiency. In this blog post, we will explore the causes and consequences of increased BPO in America.

The causes of outsourcing are challenging to pinpoint, but experts in the field point to globalization as a major reason according to PEAK Outsourcing. Globalization has increased competition between businesses abroad and those still in America. As many American companies try to stay alive by lowering costs, they have turned to offshoring and business process outsourcing (BPO). This is especially true for industries with large amounts of data collection like healthcare or finance, where there are so many administrative tasks that can be performed offshore at cheaper rates than hiring an onshore team back home.

Outsourcing has allowed many American companies to remain competitive in a global marketplace while also lowering their overhead costs and boosting productivity for some industries.

Benefits of Business Process Outsourcing For the US Companies:

Business process outsourcing has many benefits for US companies. Companies can now pay lower wages in countries like the Philippines, Sri Lanka, and India while still getting a very high level of service back. One study found that offshoring just one job overseas could save an American company up to $18k per year on average due to cheaper labor costs abroad. This means there is less pressure put on businesses and more money left over for other things like marketing or development, which can help them stay competitive with their foreign competitors.

Another benefit of business process outsourcing is increased efficiency as this type of work was designed specifically for large amounts of data collection from places like hospitals or banks where customer service reps would be required to enter information all day long. This is much more efficient than having these people onshore trying to figure out the most optimal way of entering each piece of data while also charging a lot higher than a third-party contractor.

So, take into account all of these points and decide whether outsourcing is suitable for your business or not.