Maximising cost savings and customer satisfaction through outsourcing
The inherently transactional nature of business operations means that profitability has to be one of the core focus areas for any business to survive. Reducing expenses and saving on operational costs can be a great first step in increasing profitability. However, if these cost savings come at the price of the product (or service) quality or customer satisfaction, they are not sustainable. Therefore, businesses must find ways to save costs that do not hamper their ability to serve their target customers.
Outsourcing for cost reduction is one of the most popular strategies modern businesses adopt to cover critical business functions falling outside their area of expertise. For example, a small business may outsource its accounting operations and focus its limited resources on core business capabilities and functionalities. This way, although a business may incur outsourcing costs, it ends up saving on labour (hiring, training and retaining staff) and resources (infrastructure and tools). Customer satisfaction is high as the business meets their needs and expectations.
Improving customer satisfaction while cutting costs
Reducing costs and improving efficiency are at the forefront of every business. In today’s highly competitive market, these efforts are even more crucial to surviving. There are four key business areas where you can take small steps that can not only save you substantial costs but help foster better customer experience and satisfaction as well. These four key areas are:
- Customer service:
- Warehouse and distribution:
- Inventory management and demand forecast:
- Multichannel business systems:
Everything from email and chat support to call centre falls under the customer service category and can have a significant impact on the company’s bottom line in terms of operational costs and revenue (via customer experience). Auditing your processes to identify scope for improvement, implementing benchmarks for quality assurance, staff training, and technology integration are a few steps you can take to optimise your costs while improving customer experience.
Analysing and optimising your distribution networks can help ensure timely order fulfilment and increase capacity without having to expand your infrastructure.
Effective inventory management and demand forecast can help you plan better and ensure substantial savings by effectively managing your vendors and streamlining processes.
Although complex, the right multichannel business system can have a significant impact on your operational efficiency and productivity, allowing you to monitor and manage your KPIs and stay competitive.
Improving each of these areas, however, requires specialised skill sets and tools that your business may or may not have. Building expert teams for each task would require significant investment in human resources, infrastructure and tools. Here, outsourcing is your best option to ensure higher customer satisfaction and cost savings.
Outsourcing to reduce costs and improve efficiency
One of the biggest operational expenses for a business, which outsourcing can help save, is labour expense, accounting for around 70% of total operational costs in many organisations. Additionally, hiring more people to do specialised tasks means investment in additional infrastructure, IT equipment and software tools. And balancing these costs with potential future revenue can be tricky.
Outsourcing takes these financial pressures away from businesses, allowing them to avoid many administrative burdens, save on employment costs and gain access to the same level of opportunities and talent. This way, businesses can focus on meeting their customers’ demands and keeping pace with competitors. This is the reason 27% of modern businesses leverage outsourcing for cost reduction, and the global BPO industry is set to grow at a CAGR of 10.1% from $251.1 billion in 2021 to $492.45 billion in 2028. Therefore, if your goal is to reduce costs while increasing productivity and customer satisfaction, outsourcing costs can turn into a great asset for your business.
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How can Infosys BPM help?
The customer service industry is evolving perpetually, and Infosys BPM Customer Service Outsourcing solutions can help you keep up. Helping you handle customer touch points across the entire lifecycle, Infosys BPM can comprehensively address your business-specific needs and expectations for sustainable efficiency. With our solutions for customer care services, service desk services, contact centre consulting and support services, you can leverage outsourcing for cost saving and improving customer experience while focusing on your product and service offerings.