.svg)
Call centers have long been an essential part of customer support for businesses of all sizes and industries. A call center is a centralized office where agents receive and make phone calls to provide a customer relations service or conduct telemarketing activities on behalf of a company. While call centers have traditionally focused on handling customer inquiries and resolving issues, over the years, they've evolved to include additional services such as order and payment processing, appointment setting, and technical support.
In this article, our call center experts at Hit Rate Solutions will explore the key differences between the concepts of BPO and call center while exploring the advantages of BPO call center services and how businesses can choose between the two options. We'll also discuss the future of BPO call centers and what that means for business success for businesses of all sizes and industries.
BPO vs. Call Center
Before we dive into the details, here’s a quick comparison of BPO and call centers:
BPO vs. Call Center: Defining Call Center
A call center is a central hub for managing a large volume of phone calls. These calls can be coming in (inbound calls) or going out (outbound calls). Inbound call centers are staffed by agents who answer questions and provide customer service to callers. Outbound call centers, on the other hand, use agents to make calls for sales, marketing, surveys, or other purposes. Think of call centers as the communication nerve center for many businesses, such as insurance, real estate, retail & e-commerce, etc., handling customer interactions and outreach initiatives.
BPO vs. Call Center: Defining BPO
BPO call centers have become increasingly popular in recent years as businesses seek to streamline their operations and reduce costs. A BPO service provider, or Business Process Outsourcing provider, carries out outsourcing non-core business functions to third-party providers. Unlike traditional call centers, BPO call centers offer a wider range of services, including back-office operations, data entry, accounting, and customer support. By outsourcing these functions, businesses can focus on their core competencies while enjoying the benefits of a more streamlined and efficient operation.
But where did this outsourcing business model begin? The roots of BPO can be traced back to the manufacturing industry, where outsourcing non-core functions was first adopted to reduce costs and improve efficiency. Today, businesses across industries have adopted BPO to achieve these same benefits. By outsourcing functions like customer support and data entry, businesses can lower their overhead costs and improve operational efficiency. BPO also allows businesses to access specialized expertise and technology that may not be available in-house, leading to greater innovation and growth.
Business Process Outsourcing vs. Call Centers: Understanding the Key Differences
To better understand the advantages of the BPO industry over call centers, it's important to first examine the key differences between the BPO market and traditional call centers.
A traditional call center typically provides one or more of the following services:
BPO call centers (onshore and offshore), in turn, offer a much broader range of services, which may include the following horizontal offerings:
Benefits of BPO Call Centers
BPO call centers offer small businesses several advantages over traditional call centers, including increased efficiency, scalability, and cost savings.
Here are some of the key benefits and hidden costs of using a BPO call center for your business:
Increased Efficiency
By outsourcing non-core back and front office functions to an external provider through a BPO call center, businesses can focus their human resources on their core competencies and improve overall efficiency. BPOs are typically staffed by highly trained agents who are experienced in handling a wide range of customer service and back-office tasks. This expertise can help ensure that customer inquiries are resolved quickly and efficiently, leading to reduced costs and higher levels of customer satisfaction.
Scalability
BPO can easily scale its operations up or down as needed to meet changing business needs. This scalability allows businesses to handle large volumes of calls during peak periods without the need to hire additional staff. BPO can also quickly adjust its staffing levels to accommodate changes in call volume, which helps avoid the costs associated with overstaffing or understaffing.
Cost Savings
By outsourcing non-core functions to third-party vendors, businesses can reduce their operational costs. Business process outsourcing companies typically offer lower labor costs than traditional call centers. Additionally, using BPO third-line business process outsourcing companies can help avoid the costs associated with hiring and training new employees, as well as the costs of maintaining expensive call center infrastructure.
Access to a Broader Range of Services and Expertise
BPO companies offer a wider range of services than traditional call centers, which leads to an overall improvement in business operations. In addition to customer service, BPO call centers can handle a variety of back-office tasks for business, such as data entry, document processing, and accounting services. BPO call centers are also staffed by agents with a wide range of expertise, which improves the quality of their customer service and further supports business growth.
Next, we'll discuss how businesses allow potential customers to choose between BPO vendors and traditional call centers.
BPO & Call Center: Statistics
Throughout recent years, the popularity of call centers in the U.S. has been declining, with marked falls in 2018 and 2022:
In terms of revenue, for telephone call centers in 2024, it’s around $21,8 billion, while for BPO, it’s approximately $146.30.
Below, you can see the revenue growth of the latter from 2016 to 2024:
Choosing Between BPO and Call Centers
When deciding between BPO providers and traditional call centers, there are several factors to consider, including cost, the scope of services, and scalability. Here are some things to keep in mind when making this decision.
Cost
BPO vendors can be a more cost-effective solution for businesses that are looking to outsource non-core functions. BPOs are typically located in countries with lower labor costs, which can help save money on operational costs. However, companies using domestic outsourcing should also consider other costs associated with that process, such as setup fees and ongoing management benefits administration costs.
Scope of Services
BPO companies provide a more extensive selection of services than traditional call centers, allowing for the consolidation of outsourcing needs with a single service provider. Nevertheless, before engaging a BPO company to perform business functions, businesses should carefully assess the scope of services offered by the external service provider to ensure it meets their specific needs.
Scalability
BPO offers greater scalability than traditional call centers and allows for companies to handle fluctuations in call volume more effectively. However, it's important to ensure that the BPO call center they choose has the capacity to handle their current and future call volume needs.
Quality of Service
When choosing between BPO and traditional call centers, you'll need to carefully consider the quality of service provided by each option. BPOs are typically staffed by highly trained agents who are experienced in handling a full business process and outsourcing a wide range of customer service and back-office tasks. However, the BPO call center of choice should still be able to provide high-quality service that meets specific business objectives, business processes, and needs.
Some businesses may find that a hybrid approach line to optimize business processes, using both BPO to outsource business functions and traditional call centers for back office functions, is the best option for their needs. For example, you may choose to outsource your customer service to a BPO company while handling your back-office tasks in-house. This approach can help you achieve the benefits of both options while minimizing the drawbacks.
Seeing some examples can help you visualize the benefits of BPO. In the next section, we'll explore case studies of business process outsourcing practices and examples of businesses and different companies that have made the switch to BPO from call centers.
Case Studies and Examples of Businesses that Have Made the Switch to BPO
A significant number of manufacturing companies have transitioned to BPO and have experienced substantial improvements in their business processes. Below are examples of businesses that have successfully made the switch.
Airbnb
In 2017, Airbnb announced that it was partnering with a BPO company to handle its customer service needs. The business process outsourcing (BPO) call center was able to provide 24/7 support in multiple languages, which helped Airbnb improve the overall customer experience for its users.
Sprint
In 2016, Sprint announced that it was partnering with a BPO company to handle its customer service needs. The BPO call center was able to provide high-quality service at a lower cost than Sprint's in-house call center, which helped the company save money while improving customer satisfaction.
H&R Block
In 2018, H&R Block announced that it was partnering with a BPO company to handle its tax preparation services. The BPO call center was able to provide a wider range of services than H&R Block's in-house team, which helped the company expand its offerings and better serve its customers.
These case studies demonstrate the benefits of outsourcing non-core business functions and outgoing customer calls to a BPO call center. By partnering with a BPO call center, your business can improve their business function overall efficiency, scalability, quality assurance, and cost savings while still providing high-quality service to your valued customers.
BPO Services Most Frequently Outsourced By Companies Around the World
BPO services can reduce costs, improve efficiency, and access specialized expertise while helping companies focus on their core competencies.
The Future of BPO
The business process outsourcing (BPO) call center industry and global expansion are expected to continue to grow in the coming years. As businesses look for ways to improve efficiency and reduce costs, outsourcing non-core functions to BPO is becoming an increasingly attractive option. Additionally, advances in technology, such as artificial intelligence and machine learning, are expected to play a significant role in the future of the business process outsourcing industry and call center industry evolution.
For example, AI-powered chatbots and virtual assistants can help automate many routine customer service tasks, freeing up human agents to handle more complex issues. Additionally, machine learning algorithms can help BPO companies and call centers better understand customer behavior and preferences, allowing them to provide more personalized service.
BPO for Superior Customer Experience
As you can see, BPO offers many advantages over traditional call centers, including increased efficiency, scalability, and cost savings. By outsourcing non-core functions to a BPO call center like Hit Rate Solutions, your business can focus on its core competencies while still providing high-quality service to their customers. When choosing between two options, we encourage you to consider factors such as cost, the scope of services, and scalability to determine which option is the best for your needs. With the continued growth of the BPO call center industry and the increasing use of technology, the future of customer support looks bright. If you're interested in learning more about this topic or how our team can help, please contact us today!
