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Home | Blog | Strategic Outsourced Business Solutions for Every Need

Strategic Outsourced Business Solutions for Every Need

By Lorraine O.

Updated on April 30, 2024

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Running a small-medium enterprise today means constantly looking for outsourced business solutions to improve the business and keep up with the competition.

Having access to a pool of skilled employees, excellent customer service, a strong digital presence, and leveraging technology are just ways SMEs can bridge the gap with more established companies.

One of the challenges you may have is how can they do it with limited resources. 

The 2022 Deloitte Global Outsourcing Survey revealed significant cost and operational benefits for companies strategically outsourcing key functions. So, by pursuing strategic outsourced business solutions, SMEs can secure the talent, technology, and operational capabilities required to level up.


Understanding Outsourced Business Solutions: A Strategic Approach

Strategic outsourcing involves contracting a third-party service provider to manage specific functions and tasks. While often associated with SMEs or start-ups lacking in-house capabilities, contracting out business processes caters to companies of all sizes. 

The goals of outsourcing include reducing costs, improving business workflow, utilizing new technologies, and filling gaps in in-house capabilities. 

When deciding if opting for a strategic outsourced business solution is a good business move, it’s essential to know your business’s current situation, know the expenses you may spend, and gauge if the outsourced services may address the business challenges that impede your company’s growth.

Types Of Strategic Outsourcing

Depending on the nature and scope of the outsourced functions, there are different types of strategic outsourced business solutions, such as IT outsourcing, customer service outsourcing, expert knowledge outsourcing, legal process outsourcing, and HR outsourcing.

1. Information Technology (IT) Outsourcing

IT outsourcing involves contracting third parties for services like software development, system maintenance, cloud computing, data science, and web and mobile development. 

Outsourced IT services include managed IT, software development, cloud computing, data science, and web/mobile development.

2. Business Process Outsourcing (BPO)

BPO expands beyond manufacturing to other industries. Business functions are outsourced to vendors through BPO. Historically used by industrial firms, BPO now applies to many industries. 

BPO encompasses back-office tasks like HR and accounting that don’t interface with customers and front-office tasks like sales, telemarketing, and customer support.

3. Knowledge Process Outsourcing (KPO)

KPO involves outsourcing relatively high-level, knowledge-based tasks requiring specialized expertise. It differs from BPO, which focuses on labor and operations. 

Knowledge Process Outsourcing leverages highly educated professionals for unique, non-recurring tasks not tied to ongoing operations without the expense of hiring and training in-house.

4. Customer Relationship Management (CRM) Outsourcing

CRM outsourcing delegates customer-facing tasks like sales, telemarketing, and support to vendors. This enhances customer satisfaction and enables scalable, cost-effective client contact management. 

In addition, CRM is important for building lasting relationships with customers. Newer end-to-end CRM software solutions can help companies manage all customer-related tasks smoothly if implemented and customized properly based on the company’s specific needs.

5. Human Resources Outsourcing (HRO)

HR outsourcing contracts with external providers for recruitment, payroll, benefits administration, and training. This allows in-house HR staff to devote more time to high-level strategic initiatives and talent development.

Additional benefits of HR outsourcing include accessing HR technology and expertise that may not be cost-effective to develop internally. Outsourced HR also provides the flexibility to easily scale up or down the level of HR support as business needs change.

6. Legal Process Outsourcing (LPO)

Legal process outsourcing assigns tasks like document review, contract drafting, and research to legal service providers. LPO allows organizations to tap into a global talent pool of qualified lawyers and legal professionals at a lower cost than hiring internally. 

It provides flexibility to scale legal support up or down as needed without adding a full-time headcount.


Risks of Strategic Outsourcing

While strategic outsourced business solutions have many potential benefits, there are also risks to evaluate to maximize the strategic value of outsourcing.

  • Less Control

A company has less control over work done by an outside provider. This could impact quality or timeliness. Good project management and communication can mitigate this risk. 

Furthermore, you may set and implement KPIs and metrics to monitor performance and do weekly, monthly, or quarterly performance reviews.

  • Communication Challenges

Outsourced business solutions, especially overseas, can make communication harder due to distance and time differences. The time zone difference may sometimes cause delays.

Videoconferencing, project management tools, and setting regular contact times help bridge the communication gap.

  • Unexpected Costs

Hidden costs like training, technology, or overtime can make outsourcing costs more than expected. Getting detailed estimates from providers helps avoid surprises. Time tracking tools like Time Doctor enable the accurate compensation of vendors for hours worked.

  • Finding a Good Provider

Lastly, choosing providers with suitable skills, expertise, technology access, and passion is challenging. Differing time zones complicate things further. 

In choosing an outsourcing service provider, check out their expertise and technological capabilities and do background checks to see how they commit to excellence and satisfy their clients.


How Magellan Solutions Caters Outsourced Business Solutions?

I recently sat down with Mr. Fred Chua, CEO of Magellan Solutions, to discuss how the company can serve a wide range of client’s outsourcing needs. 

As one of the players in the business process outsourcing space, Magellan Solutions has built up substantial expertise across key verticals like Customer Service, Technical Support, and Back Office functions. 

However, many clients have unique requirements that don’t fit neatly into these categories. I asked Mr. Chua how Magellan Solutions approaches assessing fit, demonstrating flexibility, and adapting capabilities when necessary to create successful partnerships. 


Q: How does Magellan Solutions assess if a potential client’s requirements match your capabilities and resources?

A: We take a very thorough approach upfront. The first step our business development team takes is a full scoping of the client’s requirements, expectations, KPIs, historical data, and more. 

From there, we can determine if it fits into one of our main service categories: Customer Service, Sales, Technical Support, and Back Office Support. For more specialized needs outside these core areas, we have a customized method for managing those engagements.


Q: What if the client request doesn’t seem like an ideal match at first? Do you turn down the business right away?

A: No, we don’t immediately decline partnerships if there is an initial mismatch. Our first step is to suggest alternatives and explore possibilities of how we might adapt our processes to meet their outsourcing requirements. We are willing to take the time to see if we can make it work.


Q: How flexible is Magellan Solutions when it comes to customizing your existing services?

A: We have quite a bit of flexibility to expand and customize our outsourcing capabilities to accommodate client needs. 

As a generalist BPO provider, our whole approach is designed to adjust based on the unique requirements of different clients. This enables us to support a wide range of outsourcing needs.


Q: When would Magellan decline a potential client engagement?

A: There are a few scenarios where we would determine the partnership is not feasible. These include situations where our recruiting team likely can’t source the staff needed for highly specialized roles. 

We also may decline transactional-based pricing models for certain complex services. Additionally, in some cases, the scope of work is either too large or too small for our sweet spot of capabilities. But we always provide alternatives before turning down business.


Outsourced Business Solutions With Magellan Solutions!


With over 18 years of experience providing expert strategic outsourced business solutions, Magellan Solutions has the capabilities to help your company optimize operations and reduce costs.

If you’re looking to outsource key business functions like IT, customer service, HR, legal, or other specialized processes, Magellan Solutions has the infrastructure and industry expertise to meet your unique needs.

To explore how Magellan Solutions can provide tailored outsourced business solutions for your company, contact us today for a complimentary consultation. Our knowledgeable team is ready to listen to your requirements and propose customized outsourcing solutions tailored to your business objectives.

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      Strategic Outsourced Business Solutions for Every Need

      Lorraine O.

      Lorraine, the creative force behind Magellan Solutions' content, is a seasoned writer with years of experience in the outsourcing industry. She stays up-to-date on new global outsourcing trends and ideas, bringing a fresh perspective to her writing. As a strategic collaborator, she enjoys turning complex outsourcing topics into clear, engaging stories that are easy to understand.

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