Generally speaking, total outsourcing is a process in which you outsource all your facilities, equipment, and data. If you outsource to BPO companies in the Philippines and you follow this model, you do not have to keep your own data center in your onshore location.

Today, we will be discussing the pros and cons of different models, and we will try to see who wins between Total Outsourcing vs. Managed Operations.

Managed Operations

Managed Operations refer to a contact center or an outsourced firm where you delegate a certain process. This is common for BPO in the Philippines. The usual set-up is that all your data, like survey returns, are in your onshore location, but they are accessible by the companies located in the Philippines.

In short, you only need to supply the business processes, the connections, or leads, and then the outsourcing firm will process the work. All information and data centers are in your location, and the outsourcer’s main job is to guarantee that your project was completed, or that your customers are served right.

Here are the advantages of Managed Operations:

  • Less cost because you are maintaining your own data center
  • Easier to migrate jobs to different locations because you have control over your data; if you want two companies, you can do so freely
  • More support from the outsourcing firm like recruitment, technical support, and management

Here are the disadvantages:

  • Higher rate of labor
  • You will pay for the cost of the asset like software and only license it to the outsourcer
  • You need to maintain your own servers and telcos; you share the problems when there are downtimes

Total Outsourcing

Total outsourcing, as mentioned earlier, are also offered by Managed Services in the Philippines, but the business agreement and structure are different.

In total outsourcing, you are asking the BPO company to build a team and a business process form the ground up. If you are offshoring in the Philippines, the outsourcing firm has to buy all the electronics, computers software, build the data centers, create a business process, and do all other things relevant to your business.

Usually, you do this if you are a start-up, or if you are outsourcing creative work. This can be done by small groups in a coworking space in Ortigas or in other locations.

Here are the advantages:

  • You have no liabilities because you do not maintain software or devices to store data
  • You can focus your time and effort on marketing and other aspects of your business

Here are the disadvantages:

  • If the data was lost, you cannot recover it
  • You cannot easily migrate to another company because you do not maintain the data
  • You have little control about the tool used to be efficient since you do not own them

Summary

Choose carefully how you want to run your outsourcing business.

Generally speaking, total outsourcing companies are for those that are just starting out, and then you can eventually move to a managed operations business model, provided that you have an agreement with the outsourcing from that you will own all the data that they have gathered through the course of doing business with you.  

*****
For inquiries, write to bd@athl.com.hk.