Staffing During the Great Resignation and a Labor Crisis in 2022

The Great Resignation has taken over headlines in the past year, accelerated by the pandemic and its subsequent awakening of the masses. As a result, everyone is re-imagining life overall. People are quitting their jobs because they now have other priorities. A worrisome concern for organizations large, medium, or small, as they spell predicament: You have a shortage of skilled people to work for you, and the ones you have are ready to quit. Not only are companies dealing not being able to hire the right skilled people, but also have to face burnout and attrition of the existing workforce due to the extra load.  

 

Voluntary turnover rose highest in recorded U.S. history in November 2021 (BLS) and with it, many experts established that people don’t want to return to work. Nearly half of America’s population is seeking out a career change (Gallup) discontented with traditional work norms. Nowadays employees are demanding better healthcare, better incentives, more flexibility, and remote capability in offices. Even with executives willing to overhaul what the old office looked like, increasing salaries, and going above and beyond to compensate employees to retain them (Forbes); what can you do if your workforce refuses to return? 

 

Remote working is here to stay for good, at least in the form of a three-day or four-day work week. Yet remains the matter of a talent shortage that is arising globally due to competition for resources across remote teams. Notwithstanding the immense cost it requires to replace a single employee and the excessive time it consumes, 7 in 10 companies can’t find the relevant skilled employees they require today. Especially when posting on job boards or paying excessive fees to a recruiting agency may not be within your budget; alternate solutions like an outsourcing partner can come to the rescue.  

 

Not only does an outsourcer handle everything from recruiting to training and onboarding fees; but they also manage attrition, so it’s not your concern anymore. The cherry on top is a massive cost difference from what you would pay to hire internally, and with highly-skilled resources specially curated to form your business team.  

 

Similar is the co-sourcing partnership Premier BPO offers its clients; we lift and shift your existing operations to the best suited global locations, ensuring our teams fit your customized business model, and operate within your time zone. You can also estimate your sample cost savings at our web ROI calculator for any number of employees. We understand the challenges faced by companies today while trying to staff in The Great Resignation; hence we provide talent from across our global locations, specific to your business niche. Particularly for first-time outsourcers, we offer a free business consultancy on a limited basis.  

 

 

Outsourcing versus Shared Services

Originally Posted on Premier BPO Website

Outsourcing and shared services are two competing trends which help organizations to get more value out of their business operations. In response to changing market trends business consultants perennially revisit the subject of shared services versus business process outsourcing.

Outsourcing:

Many businesses from small to large enterprises outsource their operations from data entry to handling email security, medical billing, customer care, budgeting and forecasting. Companies decide to outsource functions for many reasons, some of which include reduced operational costs, quality customer care, trained staff, specialized skills and equipment. Implementation of BPO concept offers following benefits:

• Companies hiring services from BPO firms don’t need to worry about the hiring and training of staff. Outsourcing companies take over the headache of managing the team of agents with desired skills and expertise.
• Customer Care Outsourcing is the best solution for multi-regional businesses which need to provide customer support in different parts of world and in different time zones
• Outsourcing offers quick and optimized solutions which lead to the improved efficiency, accuracy, and effectiveness of business operations.

Shared Services:

Many large multinational companies are adopting a shared services model in delivering human resource, IT and back office functions. This transition is tied to many benefits related to both performance and cost. Some prominent positive outcomes of a shared services model include:

• Reduction in operational costs by reducing the number of service employees, hardware and software systems.
• Improvement in organizational performance by concentrating on managerial and technical expertise.
• Shared services model is more responsive to changing business needs, as it is part of same enterprise and has close relationships with business units or departments.
• This model doesn’t require sharing information with outside third parties.

Implementing a shared services business model also incurs risks such as lack of operational flexibility, increased complexity of systems, unclear service accountability and unexpected implementation of cost escalation.

Which is Better?
 
Research reveals that a mixed approach towards outsourcing and shared services strategy is optimal.  Many companies are motivated to externalize their support services to third parties, while at the same time others prefer to focus on their shared services model. As per research mentioned on “Horses for Sources” the following trend has been observed:

• 93% of enterprises have shared services model.
• 96% have outsourced some elements like IT support and back office functions.
• 27% are reducing investments in their internal business units.
• 56% are increasing investment in centralized hybrid governess to manage the hybridization of shared services and outsourcing models.

Both of the above mentioned means of doing business incur their own benefits and risks, and each company has its own reasons for choosing a specific model. Generally, however, businesses seeking greater flexibility, multi-regional support and access to technological innovations at low cost would benefit more from outsourcing than shared services. The reason is that countries like India, Philippines, and China have developed their outsourcing industries to such a high level that their BPO firms can offer any type of technological solutions at a tremendously lower cost when compared to implementation of a shared service model within the company.

 

 Written by Shafiq U. Rahman, Director – Digital Marketing on Monday, 16 March 2015.

 

Ten benefits Insurers should be getting from their Third Party Administrators - Aashish Jain

By : Aashish Jain

Father Knows Best is a classic American TV show from the 1950s starring Robert Young as insurance salesman Jim Anderson. Back then and over the decades since, in movies and on TV, the insurance business has been portrayed as conservative, unchanging and boring. Today, nothing could be further from the truth.
Nimble insurance startups with venture capital backing are disrupting the industry. Traditional insurers are reinventing themselves through new program development, acquisitions and partnerships. Yet legacy platforms are making it increasingly difficult, time consuming and costly to manage effectively.
If you haven’t already selected a Third-Party Administrator, there’s no better time. Even if you have, here are ten things you should be getting from your TPA relationship. Give yourself a check mark for each one you experience.

1. Faster to market. A TPA can help you innovate faster. You can more quickly roll out or test hybrid and new products in the market without having to integrate them with your current systems. Legacy platforms are often too inflexible, and there are too many hoops to jump through just to see if a new program is of interest in the market. TPAs offer great flexibility for your business.
    
2. Reduced costs. In addition to reducing the high operating costs of maintaining multiple systems, your TPA can also help reduce costs by taking on some claims handling responsibilities that do not require an attorney’s involvement. Contracting with a TPA is usually less expensive than building out an entire claims department, plus TPAs offer the flexibility to supplement your existing workforce as your business needs change.
    
3. Competitive. Open source computing and development-on-demand has lowered the technical barriers to entry in the insurance industry. Nimble new players that can innovate quickly are taking advantage of the opportunity to fill the gaps that the incumbents have not. The right TPA can help you quickly introduce competitive products and options before a startup starts eating up your market share.
    
4. Better customer experience. Another important area is the customer experience. New interaction channels such as web portals, mobile apps, robo-advisors, chat and texting support are extremely important - especially for serving millennials. At the same time, distribution is looking for new channels such as electronic apps and straight-through processing engines that enable faster sales. TPAs enable your brand to take full advantage of these new technologies.
    
5. Quality controls. With multiple systems, it can be difficult to compare programs, manage financial risks and measure results. Your TPA should be providing you with comprehensive quality assurance metrics and key performance indicators, as well as cost analysis. You must know what claims are being handled and the services being provided on your behalf, and that these interactions are professional, timely and cost effective.
    
6. Security. Insurance carriers face ever-evolving requirements due to new legislation, identity theft, cyber security and more. While claims handling used to be the main focus for a TPA, that has now broadened to include data compilation, data security and reporting responsibilities.
    
7. Easier to manage. As you offer more diversified products of your own, or as a result of merger and acquisition activity or strategic partnerships, it becomes increasingly difficult to manage multiple legacy systems - as well as a disjointed workforce with expertise in one system but not another. Unifying the administration on a single platform should be your goal, but there is a high cost to getting there. Depending on the scope and time allotted to such a project, you’ll also face a conversion risk and a lack of operational readiness on the new platform. Getting up and running with a TPA is faster and simpler.
    
8. Improved insights. When considering TPAs, be sure to select one with analytics expertise. For example, one with a data analytics solution that can pull together data from all platforms to provide you with an overall view of the block, plus reports that would otherwise not be possible. Analytics can estimate the value of legal claims or assess probabilities using new types of real-time data, such as from sensors and telematics. Your TPA should be able to incorporate these to help generate meaningful risk insights.
    
9. Ease of implementation. The whole point of using a TPA is that you don’t have to go through a large internal project to get the results you want. Consider a bundled service offering that speeds up implementation and takes advantage of proven, leading platforms. For example, Capgemini’s Life & Annuity Policy Administration Services offers preconfigured, ready-to-use product templates and highly flexible, business rules-driven system configurations. Delivered via a secure cloud system, its policy administration on the leading Oracle platform, designed to help you launch new products faster, to lower administration costs and to meet the needs of your most demanding customers.
    
10. Best of both worlds. System integration experience is a key consideration when selecting a TPA. Another is business operations expertise. Collecting the data is systems integration. Asking the right questions and having actionable data comes from the business operations side. A TPA with business experience can provide assistance with data modeling for faster decision making, risk assessments and profitability analysis. Look for a TPA that combines a technically superior platform with business operations experience in a proven partnership.
     

Father may have known best in the 1950s, but the insurance business today is nothing like it was. How many checkmarks did you give yourself? If you have five or fewer, write a policy against the death of your business… or be ready, willing and able to adapt to the new reality: You need a superior member experience that’s built for this fast-changing industry. A TPA service is the answer.

 Author : Aashish Jain

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Popular Offshore Outsourcing Models

The term “offshore outsourcing” refers to the processing of work flow from large organizations by outsourcing companies halfway across the globe. In past decade rapid growth in the BPO trend is evidenced by more and more companies offshoring to destinations like China, the Philippines and India. Cost reductions, improved quality standards and greater productivity are the key factors empowering offshore outsourcing strategies.

However, the facts of business process outsourcing reveal a somewhat different reality. Before finalizing any BPO contract, management must make complex decisions when selecting the right offshore models that fulfil their business requirements. The selection process involves considering several factors such as:

·     International business strategy.

·     Selecting the best outsourcing location.

·     Scanning the landscape

·     Deciding upon a BPO strategy.

The three popular and successful models currently in use among large business enterprises are joint ventures, subsidiaries and outsourcing to service providers. Given below are details on how these models work and what their benefits are.

·                     Joint Venture Offshoring

In a joint venture (JV), one company ties itself with another organization or local firm by either forming an independent company or taking an equity stake. The aims of a joint venture are to  benefit from the individual strengths of each party involved, scale up value chains and overcome market risks. Joint venture contracts mostly include build-operate-transfer (BOT) clauses to encourage both parties to work together on defined strategies to achieve business milestones. The JV model offers several benefits, especially if the company wants to learn intricacies of managing business customs directly from the domestic partner.

·                     Subsidiary/Captive Development Center Offshoring

Common terms used to describe the subsidiary model are offshore development center (ODC), captive development center or local office. Subsidiaries are independent business units or branch executing projects and programs for onsite teams. The main challenge faced by subsidiaries is managing expert staff, technical experts, line workers and line supervisors from multicultural backgrounds. This model is quite popular among high tech companies that have adapted to new technological developments and consider offshoring as an innovative way to achieve increased diversification of their strategies.

Large software companies such as Microsoft, Oracle and IBM have already developed a reputable position in the global marketplace. Outsourcing some of their projects to other destinations is an effective way to extend their geographic foot print.

·                     Service Provider Offshoring

Joint ventures and subsidiary models require strong commitment on the part of the client organization. To remove risks tied with these models and to maximize benefits of offshore outsourcing companies tend to outsource their projects to offshore service providers. Interestingly enough, service provider offshoring is the most commonly used model as it encompasses a wide range of jobs from small projects to multi-year contracts.

In summary, offshoring can be a complex decision which directly impacts a company’s market reputation. Business leaders need to consider both the pros and cons of each of these models before implementing a specific course of action within their organization. These days many companies are using customized hybrids which incorporate various principles from all of these models in order to stand out in a competitive market.

Is Cloud Computing a key enabler for BPO?

With evolution of the concept of cloud computing many BPO firms consider it to be a game changer in the next generation of outsourcing.  As cloud concept represents a new way to remotely manage computing resources.  One of the most promising features of combining cloud with business process outsourcing is that it allows enterprises to improve service quality, expand market reach, customer interaction and the ability to to deliver customer care from anywhere in the world. 

 Furthermore BPO concept coupled with cloud technology offers enhanced scalability, reliability, agility and cost arbitrage.  

The main benefits offered by this hybrid include:

• Geographic Diversity

Cloud computing offers geographic diversity by building geo-distributed data centers and networks. This diversity decreases redundancy to users and improves reliability.

• Flexibility

Most firms face the problem to manage much needed bandwidth for business demands. In such a scenario the increased bandwidth requirement can be easily managed by utilizing the vast capacity of remote servers.

• Disaster Recovery

Utilization of cloud based services improves disaster recovery time and eliminates the need of having a costly system to deal with unexpected situation.

• Improved Collaboration Channel

Cloud based platforms offer better collaboration channels to employees allowing them to work on shared documents and apps simultaneously. This improves communication, which is a principal requirement of outsourcing.

There is little doubt that the cloud based innovative approach has helped businesses to minimize operating cost and maximize resource utilization while maintaining high quality standards for customer service.

Outsourcing vs In-sourcing: Which is better?

In today’s competitive business environment, owners want to increase margins by cutting costs but are generally uncertain on how to go about it.  Sometimes such decisions lead them to compare cost differentials, process efficiencies, quality of staff, etc. between outsourcing and in-sourcing. The giant leaps taken in process efficiencies through the use of technological innovations, automation and cloud services have really added value to the concept of outsourcing and moved it ahead of insourcing in many aspects of the efficiency, cost, and staffing scale.  Now one finds many companies consider the route to outsourcing as the way to generate business efficiencies, cut costs, save valuable time and concentrate on core business functions.

However both outsourcing and in-sourcing have their own pros and cons.

Outsourcing:

These days’ companies outsource their operations from data entry to handling email security, medical billing, customer care, budgeting and forecasting. Need of specialized skills, equipment, lower cost solutions and quality customer care are some of the main reasons companies outsource.  Some benefits of outsourcing services to third parties include:

• It allows companies to hire skilled staff for defined period of time without any long term commitments, payroll taxes, and high generally high wages.
• Multi-regional businesses can hire customer care agents to ensure 24/7 support.
• In-house staff can concentrate exclusively on core business operations by outsourcing non-core functions to outsourcing firm.
• Outsourcing leads to improvement in efficiency, accuracy and effectiveness of business operations.

In-sourcing:

In-sourcing to run a business and to try and improve process efficiencies is a path normally practiced by most companies. Security issues, lack of communication and lesser control over team activities are some of the main reasons that drive the company’s decision to stick with in-sourcing. Some advantages of in-sourcing over outsourcing include:

• Managing operations in-house gives greater control over daily operations, time utilization and quality.
• Goals and targets can be more effectively communicated to in-house team.
• In-sourcing allows greater interaction between in-house team and management leading to increased level of motivation in workers.
• Managing all functions in house, allows decision makers to better understand market trends and enable company to create backup plans.

Which is better?

While choosing between in-sourcing and outsourcing companies first need to be very clear about their business goal. If management is not clear about its objectives neither insourcing nor outsourcing will be beneficial.  

In-sourcing results in greater control over business functions but increases the annual budget of a company’s business as insourcing adds up cost of expensive local staff, machinery, software, hardware costs, and other technology needs. On the other hand, outsourcing cuts cost of staffing (currency valuation, lower base salaries, and abundance of educated population), staff training, and maintenance of hardware and software systems.

Recent statics appearing in Bloomberg Business, suggest that a majority of companies are considering outsourcing over in-sourcing.  These statistics suggest:

• 50% of companies outsource production or delivery of core products and services
• 33% of companies outsource sales and marketing operations.
• 32% of companies outsource R&D activities.
• 70% of companies outsource strategic functions.

No doubt both outsourcing and in-sourcing offer good and bad results.  Based on the achieved industry wide results through outsourcing, it is clearly a trend that is worth considering to get a competitive edge over your competition in your industry.  Smart businesses are earning huge dividend – in cost, process efficiencies, educated staff, and quality customer care by utilizing outsourcing concept intelligently.