Business Process Outsourcing (BPO) companies often use various corporate arrangements and models to provide outsourcing services to their clients. These arrangements are designed to meet the specific needs and preferences of clients while ensuring efficient operations. Here are some common corporate arrangements used by BPOs for outsourcing clients:
- Shared Services Model: In this model, the BPO sets up a centralized shared services center that serves multiple clients. The center handles common back-office functions such as HR, finance, and IT for all clients, achieving economies of scale.
- Captive Centers: Some clients choose to establish their own offshore centers, commonly referred to as captive centers. These are essentially extensions of the client’s organization located in a different region, but they manage their own operations.
- Dedicated Centers: BPOs may create dedicated centers exclusively for a single client. These centers are customized to cater to the unique requirements of that client’s processes and operations.
- Build-Operate-Transfer (BOT): Under this arrangement, the BPO sets up and operates the outsourcing operations for a client, and after a specified period, the operations are transferred back to the client’s control.
- Joint Ventures: BPOs and clients sometimes collaborate to create joint ventures. This allows clients to have direct ownership and control over the outsourcing operations while leveraging the BPO’s expertise.
- Multi-Process Outsourcing (MPO): In this arrangement, the BPO provides a bundle of related services to a client, covering multiple processes under a single contract.
- Platform-Based Outsourcing: BPOs may offer access to specialized platforms or software solutions to clients, allowing them to streamline processes and enhance efficiency.
- Value-Added Services: BPOs may offer additional services beyond basic outsourcing, such as consulting, analytics, and process improvement.
- Build-Operate-Own (BOO): Similar to the BOT model, in the BOO model, the BPO sets up and operates the outsourcing center but retains ownership of the operations over the long term.
- Global Delivery Centers: BPOs establish delivery centers in different global locations to provide clients with access to a diverse talent pool and time zone coverage.
- Platform as a Service (PaaS): BPOs offer software platforms that clients can use to manage their processes while the BPO handles the technical infrastructure and maintenance.
- Outcome-Based Models: BPOs may offer pricing models based on outcomes or performance metrics, aligning their success with the success of the client’s operations.
- Risk-Sharing Agreements: BPOs and clients share the risks and rewards of the outsourcing engagement, encouraging collaboration and mutual success.
- Managed Services: BPOs provide end-to-end management of specific processes or functions, allowing clients to focus on their core business activities.
- Onshore, Nearshore, and Offshore Models: BPOs offer various delivery location options, including onshore (same country), nearshore (close geographical proximity), and offshore (different country) options.
These arrangements provide flexibility for clients to choose the model that best fits their requirements, whether it’s cost savings, specialized expertise, or process optimization. The choice of arrangement often depends on factors like the complexity of the processes, the client’s strategic goals, the industry, and the desired level of control over operations.