23.04.2014

Delegating business processes to a third-party company does not have to mean physical separation of that specific area from the organisation. Some services (except for those whose intrinsic nature requires that) can be successfully provided in principal’s offices, not infrequently by the same personnel, but employed by an outsourcer.

The need of constant processes control is the major concern related to outsourcing services. That concern is reported by as much as 54 per cent of companies1. Starting the outsourcing adventure inside own company allows for smooth accustoming the business model of outsourcing individual processes to third-party companies. Having experienced positive feedback, some customers finally decide to move the project to service provider’s site, allowing for further costs reduction.
1Ipsos survey to OEX Group’s order, 2012

In- or outside?

Some processes are intrinsically connected to customer’s office. They include mainly temporary workers contracts, for providing e.g. front-desk services, customer’s warehouses services or cash registers operators. In case of activities that can be performed externally, they are most often executed in operational centres of service providers. The centres are professionally equipped, with necessary infrastructure and employ personnel trained for handling specific processes. Some projects remain, however, in customer’s office. When it happens so? In the majority of cases it is simply customer’s decision or the result of economic calculations. In case a principal has relevant infrastructure and qualified personnel for handling the process, third-party company takes over its execution adding know-how that allows project optimisation in terms of time and costs. When the project remains on-site, a principal is able to monitor its execution on an on-going basis and an external partner can quickly respond to any possible problems. In case personnel is also taken over, the need to dismiss some part of workforce can be avoided and people joining the outsourcer’s team have a chance to gain new skills.

What are the costs the customer is willing to bear deciding on on-site outsourcing version? Most of all it is connected to the need of providing space necessary for the service and also bearing costs of utilities consumption e.g. electricity. If the customer delivers also equipment infrastructure, e.g. IT hardware, it remains responsible for its maintenance and service as well. In case employees are taken over under art 23’ the cost of service may by higher (although it is not always the case), than in case of using the outsourcer’s human resources.

Which processes can be executed on-site?

Documents mailing room service is often provided on-site, in the customer’s office. Already a dozen of ArchiDoc’s customers decided on outsourcing of this service, among others PZU Group, Bank Millennium or Credit Agricole. The solution ensures benefits of shorter circulation of original copies of documents and real-time access to their electronic version irrespectively of the place the service is performed. Also scanning may take place in customer’s office, in particular with regard to the documentation that requires strict security standards (archives of the Chancellery of the President of Poland) or which would be difficult to transport (digitalisation of library collections or court documentation).

Another example of the project executed on-site is warehousing as well as picking and packing of orders for one of the largest press distributors, for whom this service was provided by Cursor company from OEX Group. Also in this case the outsourcer took over principal’s employees for the needs of project execution. There are sometimes call centre service contracts which provide for outsourcer’s delegating consultants to perform the service in customer’s office. Such solutions are often used by both, smaller companies which need one person to operate company hot-line and the largest entities which supplement this way the resources of own call centres (in periods of intense sales actions).

Selecting a partner

On-site outsourcing services are most often inquired by public institutions which are still less open to outsourcing solutions than commercial companies. The latter are observed to have larger awareness and knowledge on external services which reduce mutual efforts on developing optimal cooperation model.

Decision of the final project location is most often taken at the business analysis phase. In most cases however, the security and financial effectiveness remains the key criterion. Also the outsourcer’s flexibility, competences and infrastructure is of key importance. Careful verification of the process and customer’s requirements allows for determining the resources necessary for its completion. Not each and every outsourcer is be able to meet such a challenge.

What are key factors for services provided on-site? Most of all, it is knowledge and experience; also, mobile teams of workers, e.g. willing to work away from home. For some services also a mobile infrastructure will be necessary, e.g. data repositories that enable even the largest documents management projects to be completed anywhere indicated by a customer. Additionally, certificates and procedures warranting safety of processes are very important. Comparing own needs and capacities with an extensive range of services available in the outsourcing market will allow optimal solution to be selected for the specific organisation.

Konrad Rochalski,
President of Board, Outsourcing Experts