Running a business can be highly challenging and sometimes overwhelming for many entrepreneurs. As a business owner, you are responsible for making sure that your company operates proficiently. Aside from the daily tasks that you need to attend to, you also need to ensure that all aspects of your business are running smoothly. It can be overwhelming for many business owners, and that’s why many companies turn to outsourcing to help them manage their businesses. Here are some signs that your business needs the assistance of an outsourcing agency.

You are unable to keep up with demand

Increased demand for your products means that your sales are growing and you are generating higher revenue. While this is a good sign for your business, it also means that you need to work extra hard to fulfil your customer demands. If you have a limited workforce, you might not be able to effectively handle the large volume of orders and meet your deadlines.

With the help of an outsourcing company, you can efficiently manage and accomplish your orders without compromising quality. Outsourcing can enable you to cater to your clients' needs and allow you to focus on other essential aspects of your business.

Lack of progression or plateaued sales

On the other hand, if you notice that your company has not been growing significantly, this is an indicator that an area of your business is struggling. You might be overly focused on accomplishing your administrative tasks that you failed to manage your operations properly. Outsourcing certain aspects of your business can reduce your workload and ensure that every area is adequately attended to. It will also improve your business productivity and performance.

You are constantly stressed out and unproductive

If you constantly feel stressed out and cannot balance all of your responsibilities, outsourcing some of your tasks can help relieve some of the stress. Additionally, if you notice that you need to reset your work-life balance, it is a clear indication that you are unable to manage your time correctly. Outsourcing one or two of your daily tasks can provide you with that needed rest.

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You are seeking ways to cut down on operating expenses

If your workforce is limited, hiring additional employees might be more costly than getting the help of a third-party agency. Remember that you need to provide your employees with their salaries and ensure that they are getting the basic benefits mandated by law. Moreover, hiring people can be time-consuming and unproductive, especially for small and medium-sized enterprises.

If you choose to work with an outsourcing provider, you only need to pay for the services that your business requires. For instance, if your company is involved in the oil and gas industry and you need assistance with back-office operations, you can work with a reliable outsourcing company that can handle and achieve your business needs.

You can also skip the hiring process and have access to several professional experts. Outsourcing companies routinely train their staff to ensure that their skills remain relevant, so you are guaranteed that your business is up to date with the latest industry trends.

Outsourcing is a great way to save money while generating revenue for your business. Depending on your business needs and focus, outsourcing help can help grow your business.

The pandemic has also pushed the sector further into the national spotlight. Financial services providers are under pressure to support businesses and individuals in distress, while facing increased scrutiny over customer experience – particularly when it comes to vulnerable customers. Finance Monthly hears from Craig Naylor-Smith, managing director of Parseq, on  how firms can keep up with these demands and overcome the new obstacles 2021 will bring.

In this climate, firms must continue to invest in their operations if they are to remain competitive, protect their reputation and meet the constantly evolving demands of customers. By transforming inefficient processes, firms can develop more productive operations and free-up funds to help drive new investment in the year ahead. Here, the support of an expert partner can be key.

Transformation plans

It is encouraging to see that financial services executives already have transformation firmly on their agendas. At Parseq, we recently surveyed more than 50 C-suite executives at some of the UK’s largest financial services firms for our inaugural Big Business Efficiency Report to understand their plans for the next 12 months when it comes to transformation and efficiency.

Four in five executives (84%) plan to transform their business operations over the coming year, and every executive we spoke to is planning to make their business more efficient.

When it comes to transformation, executives’ focus areas are diverse. In the front office, marketing (44%), sales (37%) and customer experience (19%) are priorities. In the back office, finance and administration (35%), IT (30%), compliance (26%) and HR (26%) top the list.

The use of AI and machine learning (41%), digital channels for internal and external communications (35%) and new workflow management software (33%) are the most popular steps executives will take to help increase business efficiency in 2021.

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When asked how they would use the capital unlocked through efficiency gains in the next twelve months, more than half of respondents said they will invest in new technology (57%), while almost two fifths said they would improve customer experience (37%) and expand into new markets (37%).

Overcoming obstacles

These findings highlight the broad range of efficiency and transformation strategies financial services executives are formulating. However, executives also highlighted several barriers when it comes to putting efficiency measures into action.

Our respondents cited cost (37%), complexity (35%), a lack of time (29%), a lack of knowledge (29%) and a reliance on legacy systems (29%) as their biggest hurdles.

And, while 71% of executives who said they were planning to use outsourcers over the next 12 months were more likely to do so after the UK’s first lockdown in March, a fifth (20%) said a lack of awareness of available third-party support was a factor currently holding them back.

From our 40 years of experience at Parseq, we know that outsourcing to a third-party can achieve permanent efficiency savings of at least 30%. However, while outsourcing partnerships can return impressive cost savings and help executives directly tackle issues such as complexity and time, its benefits can extend far beyond this. Through their expertise and experience, outsourcing partners can also play a key role in helping firms deliver long-term transformation in their operations.

Looking ahead, financial services firms that successfully enhance their efficiency and enact transformation will be well placed to overcome any obstacles that may arise this year. Through transformation, and by utilising third-party support, businesses will be able to unlock the capital that will be key to helping them thrive in a challenging and competitive environment.

Outsourcing Finance Services: Everything You Need to Know 

The popularity of financial outsourcing is growing every day, as it enables medium-sized businesses and large companies to improve their financial functions cost-effectively. In this article, we will cover the following points:

1. What is Outsourcing & Accounting Outsourcing?
2. Risks Related to Outsourcing Finance Operations
3. Reasons Why Organisations Should Outsource Finance and Accounting
4. Outsourcing Finance: Find a Reliable Vendor 

What is Outsourcing & Accounting Outsourcing?

First, you need to know that outsourcing is a company's refusal to independently perform a number of non-critical business functions or parts of business processes and transfer them to a third-party contractor who professionally specialises in the provision of such finance and accounting services.

Consequently, financial outsourcing is the transfer of the functions of accounting and tax accounting and reporting to specialised organisations.

Company's Operations to Outsource

Of course, financial and accounting outsourcing is not all. Companies can outsource the following functions:

• human resource management;
• facilities management;
• supply chain management;
• customer support, etc.

For example, if you are looking for software development outsourcing, it would be a good idea to look into the web development services of a company that develops custom software from a distance.

Finance Services for Outsourcing

If you want to outsource crypto or financial tasks, this does not mean at all that you need to give the intermediary all the available financial information.

Outsourcing can be used for the following assignments:

1. Bookkeeping and Back-Office Support 
2. Controller Services
3. Financial Planning and Analysis (FP&A) 

3 Types of Outsourcing

Now you already roughly understand what functions in the company you can outsource. Now is the time to choose the type of outsourcing.

There are three different types of outsourcing:

1. Local Outsourcing
2. Nearshore Outsourcing
3. Offshore Outsourcing

So you will need to deal with each type separately and decide which one suits best.

Risks Related to Outsourcing Finance Operations

Any modern innovation, like accounting outsourcing or day trading crypto, has its own risks. They should not scare and stop you, you just need to take them into account and think over in advance what you will do in case of an unfortunate situation.

Possible Hidden Costs

Due to the fact that you, shall we say, start working with new people, there is a possibility of misunderstanding, which can lead to the fact that in one task there will be more details, the implementation of which you did not initially take into account, and this will increase your expenses.

Therefore, try to immediately discuss everything in detail and draw up a specific plan of tasks.

Less Control

When you delegate tasks to someone who is not on your team, it will be difficult for you to control the process. You will no longer be able to ask daily how the process is going.

Therefore, it is very important to initially establish a high level of trust so that you do not constantly feel that the person will do something wrong.

Distance, no Local Presence

We have already talked about this above. When you transfer some functions to outsourcers, you will be ready for the fact that you will receive answers to questions, let's say, with a delay.

To make it easier to communicate, you can set a specific schedule so that the outsourcer knows exactly when you will contact him.

Reasons Why Organisations Should Outsource Finance and Accounting

Of course, the reasons why it is very profitable for companies to outsource certain functions clearly outweigh the above risks. Let's take a closer look at all the benefits.

1. Cost-efficiency 

According to statistics, the use of outsourcing for a number of functions of company employees reduces costs by 30-45%. This is because there are employees who receive a lot, but for some reason their performance may decrease, which harms the result.

2. Focus on Strategic Tasks 

When you outsource a percentage of your work, it automatically creates more time and energy that can be spent on important tasks for the company. Everything is simple here - the less your employees are employed, the better they will perform important work.

3. Access to Specialised Talents

Outsourcing finance and accounting, since it is not tied to a specific territory, gives you access to all the people in the world who are looking for outsourcing accounting work. Thus, you have increased opportunities to find a talented and experienced person in their field.

4. Hiring Costs Elimination

When you hire a new employee, very often they need to be taught, trained, sent to some courses, and so on. With outsourcing finance, all these costs disappear, since you hire a professional in your business who just needs to be given a task.

5. Advanced Technologies and Systems

This is one of the biggest benefits, as outsourcing companies usually use cutting edge technologies that help increase work speed and avoid mistakes as much as possible.

6. Enhanced Business Operations & Accuracy

Again, outsourcing is convenient in terms of the quality of work. Your regular employees, who do the same tasks every day, do everything automatically and do not try to change or improve something. By outsourcing finance tasks, you can get not only fresh solutions, but also, possibly, change something in your company.

Outsourcing Finance: Find a Reliable Vendor 

We have already talked about what benefits a properly chosen outsourcing company can bring to you. The main thing remains - to choose this company.

Therefore, now we will talk about how to choose the right outsourcing company.

1. Search for Proven, Streamlined Processes 

Experienced outsourcers always have an established process and structure. You need to look for those who will not only promise a good result, but also clearly show how they will achieve this result.

Also, keep in mind that the team you hire must ensure risk control and data security.

2. Check Team's Experience

It is clear that you are not going to hire a person from the street, but it will not be superfluous to check the experience of the team, what projects they worked on, and ask for recommendations, and so on.

3. Evaluate Methods and Metrics for Success Measuring

Ideally, your prospective provider should have methods that will provide assessment and improvement of the company's financial condition, as well as show errors.

In Conclusion: Is Outsourcing Financial Services Right For Your Company?

Finance and accounting outsourcing services will help you not only decrease the tasks of your employees, but also reduce costs, improve results, improve some activities in the company, and so on.

The main thing remains to find an experienced provider who will meet all the necessary conditions.

A high-quality and well-thought-out process will bring great benefits to your company!

However, it can be difficult to know the aspects that are best to invest in. Here are five things your business should put their profits into in order to be successful.

Marketing

One of the most important elements of your business is going to be marketing. This is how you sell your products and services. Do not wait until you have built up a good customer database. From the beginning, you have to be investing in marketing so that you can grow. In particular, internet marketing is vital in the digital age and will attract new people to your business. If you do not know a lot about this, it is imperative that you outsource or hire employees that do. Having a marketing team will be highly benefit for your success.

Training and Education

If you want to continue to grow as a business, you need to invest in your workforce. Your staff are going to be responsible for the daily running’s and tasks at your company. It is essential they know how to be efficient and productive. Therefore, regular training is going to be important so that new skills can be learned and updated, depending on the field you are working in. There should also be a general opportunity for education so that your employees can progress.

Outsourcing

As your business builds momentum, there are going to be simple yet time-consuming tasks that need to be done. This could be anything from accounting to sorting the payroll. A good way to invest in your company, but save money at the same time, is to outsource some of this work. This can be a good way to find experts with the relevant skills and experience and only pay them for the work completed. Take your time and find professionals that are going to help your business grow and do not rush into decisions. Always seek testimonials before hiring third parties.

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Yourself

While many businesses owners remember to invest in their premises and their employees, they often forget to invest in themselves. There are still a lot of skills you can learn, whether this is taking online courses or attending conferences. After all, you are in charge of everything when it comes to your business. You want to stay up-to-date with the latest discoveries and technology so that you can stay ahead of the competition.

Equipment

If your business is doing well, you may see no need to change the status quo. However, it is essential that you continue to invest in your technology and equipment. This is going to allow you to keep up with innovations and trends in your industry. While you do not have to change your setup completely, every year you should be looking for ways to boost your efficiency. If you are worried about money, you can always look into equipment financing online. This can give you access to credit options.

That’s according to a new in-depth study, commissioned by Asset Control and executed by independent research firm OnePoll.

Also playing to the focus on expertise, 48% of the sample overall referenced ‘a third party has productised industry knowledge that we can benefit from’, among their main drivers for adopting standard products and services instead of internally solving business data challenges. In line with this focus, by far the biggest consideration respondents had when costing an external technology solution was ‘the availability of skills in the market for the approach chosen,’ cited by 49% of respondents in total.

Cost was also a big issue driving the uptake of third-party technology solutions. 48% of the survey sample ranked the fact that an outsourced solution ‘was more cost-effective’ among their top reasons for using it.

Martijn Groot, VP Marketing and Strategy, Asset Control said: “Financial services businesses are often attracted into adopting an outsourced approach by a straightforward drive to cut costs, coupled with a desire to tap into broader industry knowledge and expertise.

“Adopting third-party solutions typically allows firms to reduce costs through improved time to market and post-project continuity,” he added. “And the opportunity to take advantage of the breadth of expertise and understanding that a third-party provider can deliver gives them peace of mind and allows the internal IT team to focus more on business enablement which typically involves optimal deployment, integration and change management.”     

The benefits of an external third-party provider approach were further highlighted when respondents were asked where they looked first for data management solutions. The most popular answer was ‘externally bundled with complete services offering (e.g. hosting, IT ops, business ops) as part of business processes outsourcing deal’ (28%), followed by ‘externally bundled with tech services offering (e.g. hosting, IT operations) as part of IT outsourcing deal’ (21%). ‘In-house with internal IT’ trailed well behind, with only 17% of the survey sample referencing it.

According to Groot: “The answers show that rather than just following the data and having to install and maintain it, businesses are increasingly looking for a much broader managed data services offering, which allows them to access the skills and expertise of a specialist provider.

“Firms today also increasingly want to tap into the benefits of a full services model,” he continued. “They are looking to join forces with a hosting, applications management or IT operations approach and often that is in a bid to achieve faster cycle time, reduced and more predictable cost of change and a demonstrably faster ROI into the bargain.”

(Source: Asset Control)

Also playing to the focus on expertise, 48% of the sample overall referenced ‘a third party has productised industry knowledge that we can benefit from’, among their main drivers for adopting standard products and services instead of internally solving business data challenges. In line with this focus, by far the biggest consideration respondents had when costing an external technology solution was ‘the availability of skills in the market for the approach chosen,’ cited by 49% of respondents in total. 

Cost was also a big issue driving the uptake of third-party technology solutions. 48% of the survey sample ranked the fact that an outsourced solution ‘was more cost-effective’ among their top reasons for using it.

Martijn Groot, VP Marketing and Strategy, Asset Control said: “Financial services businesses are often attracted into adopting an outsourced approach by a straightforward drive to cut costs, coupled with a desire to tap into broader industry knowledge and expertise.

“Adopting third-party solutions typically allows firms to reduce costs through improved time to market and post-project continuity,” he added. “And the opportunity to take advantage of the breadth of expertise and understanding that a third-party provider can deliver gives them peace of mind and allows the internal IT team to focus more on business enablement which typically involves optimal deployment, integration and change management.”

The benefits of an external third-party provider approach were further highlighted when respondents were asked where they looked first for data management solutions. The most popular answer was ‘externally bundled with complete services offering (e.g. hosting, IT ops, business ops) as part of business processes outsourcing deal’ (28%), followed by ‘externally bundled with tech services offering (e.g. hosting, IT operations) as part of IT outsourcing deal’ (21%). ‘In-house with internal IT’ trailed well behind, with only 17% of the survey sample referencing it.

According to Groot: “The answers show that rather than just following the data and having to install and maintain it, businesses are increasingly looking for a much broader managed data services offering, which allows them to access the skills and expertise of a specialist provider.

“Firms today also increasingly want to tap into the benefits of a full services model,” he continued. “They are looking to join forces with a hosting, applications management or IT operations approach and often that is in a bid to achieve faster cycle time, reduced and more predictable cost of change and a demonstrably faster ROI into the bargain.”

(Source: Asset Control)

Outsourcing agreements worth £718 million were signed between January and March, according to the Arvato UK Outsourcing Index.

Outsourcing contracts worth £718 million were signed in the UK between January and March this year, with financial services and retail businesses the most active buyers, according to the Arvato UK Outsourcing Index.

The research, compiled by business outsourcing partner Arvato and industry analyst NelsonHall, found that deals worth £363 million were signed in the financial services sector, accounting for 51% of the total UK outsourcing market in Q1 and more than double the value agreed in the previous quarter (£153 million).

Retail companies agreed outsourcing deals worth £140 million in the first quarter of this year after three months of no activity in October to December 2017, according to the findings.

The rise in spending across retail and financial services contributed to an eight% increase in total contract value compared with the last quarter of 2017.

Customer service agreements continued to factor highly in UK outsourcing activity, accounting for over 20% of all spend (£152 million). This, combined with HR and payment processing contracts, saw Business Process Outsourcing (BPO) deals account for £256 million of spend – up from £179 million agreed in Q4 2017.

IT Outsourcing (ITO) contracts worth £462 million were signed in Q1, with procurement focused on cloud computing, and asset and infrastructure management.

Despite the rise in activity quarter-on-quarter, the value of outsourcing contracts signed in Q1 represents a more subdued start to the year compared with 2017 which was a record year for the industry. The research found that spend on outsourcing deals between January and March has fallen 75% year-on-year from Q1 2017.

Debra Maxwell, CEO, CRM Solutions UK & Ireland, Arvato, said: “Following a strong year for UK outsourcing in 2017, we’ve seen a more subdued market in the first quarter. With Brexit uncertainty continuing to influence buying decisions and the imminent implementation of GDPR taking up internal resources, it is to be expected that fewer deals would make it over the line in this period.

“Yet, our findings show there remains strong appetite from businesses to work with outsourcing partners to bring in external expertise for key operational areas such as customer services, and to invest in maintaining a robust IT infrastructure.”

The private sector dominated the UK outsourcing market in Q1 as businesses accounted for 90% (£645 million) of the total value of contracts signed, according to the findings.

The research found that public sector organisations agreed deals worth £73 million over the period, down from £229 million in the previous quarter. Government departments focused on securing contracts for cloud computing and application and infrastructure management.

The Arvato UK Outsourcing Index is compiled by leading BPO and IT outsourcing research and analysis firm NelsonHall, in partnership with Arvato UK. The research is based on an analysis of outsourcing contracts procured in the UK market between January and March 2018.

(Source: Arvato UK & Ireland)

Interested in scaling your company, or has the scaling process already begun? We connected with Dan Kiely, CEO of Voxpro - powered by TELUS International, a leading provider of customer experience, technical support, and sales operations, to discuss how to scale your business, and the importance of maintaining focus on customer service as your company grows.

What is scaling your company all about?

If you’re scaling your company, congratulations! It’s an exciting time for all involved. At Voxpro - powered by TELUS International, we use the term ‘blitzscale’, which was coined by Reid Hoffman, Co-founder of LinkedIn and PayPal. Learning from the growth of other companies, we’ve realized that if you don’t scale fast enough, you’re going to lose your lead, or even worse – someone could take your idea.

In the early days of developing Voxpro, we had an idea for a new approach to outsourcing, and knew we had to act on it immediately, before anyone else did. We blitzscaled – we opened more offices, hired more people, and signed on more partners. After doubling our workforce and quadrupling the number of countries where we had a home base, we increased our services in two years. Then, in the summer of 2017, we partnered with TELUS International - a customer experience and digital services firm with a footprint across four continents. By joining our two companies, we are now backed by TELUS International’s robust global infrastructure and have an enhanced ability to offer a more comprehensive suite of solutions to the brands we serve to enable new go-to-market opportunities and growth in the digital and IT services market.

Scaling your company is about finding the right partners, but it’s also about hiring all-around good, hard workers, having a mission you really believe in, and creating a strong brand for your employees. Our experience as a former start-up, then scale-up translates into our innate ability to do the same for other brands, helping them scale their customer experience operations while they grow their business.

Why do you believe scaling customer experience and scaling business operations go hand-in-hand?

As your business grows, your customer base should ideally grow at the same or a similar pace. Growing your customer base means an increased number of support inquiries, and keeping up with demand to deliver a strong customer experience is crucial to maintaining your brand’s integrity and attracting and retaining customers. Take our partner Airbnb for instance. They went from hosting 300,000 homes on their site in 2013 to 3,000,000 homes in 2017. To meet the needs of their customers, Airbnb recently launched its Experiences and Places platforms, connecting their renters to local activities and hidden gems in the cities they are visiting. Giving power to the people, Airbnb increased its offering while managing a positive customer experience to meet the interest of its users.

As CEO of a growing company, what are some of your critical practices for relaying important information to your employees, and keeping the business moving?

When we created Voxpro, we set in place a series of values that we hold ourselves to every day. Sometimes, setting and understanding a company’s values can be overlooked, but not for us. Our values aren’t just words on a page, rather they drive our great company culture. These values also guide the partnerships we form, such as with TELUS International. They are a like-minded partner with similar values, and together, we are building upon our shared commitment to fostering and sustaining a caring culture focused on team member engagement and development, and giving back to the communities where we work and live.

Our powerful C-Suite leadership team that includes Jeffrey Puritt, President and CEO of TELUS International, keeps a pulse on our culture and employee engagement, identifying issues and putting forward solutions. We know that people want to be in an inclusive environment, even as a company begins to scale. Our values strive to ignite a sense of entrepreneurship, ownership and operational beauty in people. Through operational beauty, we encourage our employees to grow both personally and professionally. Having a purpose and mission that your employees can get behind will add motivation, plus heart and soul, to a company. This is ultimately reflected in the customer experience that we deliver.

The FinTech industry is seeing a number of companies scale at the moment. Are you seeing any emerging trends?

We partner with a number of companies who are in that “sweet spot” in the scaling process – they’re no longer a start-up, but they aren’t quite on a level of recognition internationally, or globally mature yet. Many times, these organizations are feeling the growing pains and recognize the need for a strong customer experience partner to ensure continued customer satisfaction and reduce customer loss. It can be a big step for companies to recognize that they need additional support, and a BPO provider in a lot of instances can be the smart choice when expanding.

Regarding FinTech, two of our partners who are leaders in the space come to mind. Both companies were searching for a partner to help manager their customer service as their businesses quickly grew. We partnered with them by offering a customized selection of services. Multi-channel, multi-lingual, and social media management were of importance to one, while our partnership with the other FinTech company focused solely on managing safety, fraud, and risk. In each instance, we were able to rapidly onboard and provide the necessary support, so their customers did not feel any strain from the expanding organization. Each of these partners’ needs are vastly different, and that’s what makes what we do and what we can provide so exciting. It’s not a one-size fits all model.

In what ways can scaling companies manage the customer experience for their clients in times of hyper-growth?

When rapidly growing a business, executives must come together to answer difficult questions in order to strategically plan for the future – “Can we do this alone? Do we need advanced services? Can we afford to make a change in staffing?” For some companies, outsourcing a sector of their business becomes an option, but sometimes companies are tentative to do so. It’s important for executives to understand that it’s more efficient and productive to focus on what you’re best at - your core competencies and what has made you successful to date - and seek a trusted partner in other departments, especially customer service.

Also, when rapidly scaling, the need to incorporate digital services and next-gen technology such as artificial intelligence and machine learning continues to grow. It’s important to have a trusted partner already invested in these capabilities and have a knowledgeable team in place able to harness the power of innovation to drive your new business outcomes and customer loyalty.After all, your customers are what drive your business and solidify your reputation in the market.

It’s important to keep your customers happy while scaling, of course, but what about your employees? How should growing companies respond to the challenges of retaining current employees and recruiting new ones?

As part of your growth, it’s inevitable that you’re going to have to hire and onboard new employees and also ensure the ones you currently employ continue to be inspired and engaged through all the changes. Ingraining your company’s values in new hires should be a top priority as these new employees have the potential to either help or hinder the execution of your company’s mission and strategy. Set yourself to a standard, and don’t stray away from it.

We have Voxpro University, which serves as a training resource plus a compilation of our branded learning and development tools, and TELUS International University, which enables our employees to earn a subsidized degree while working. These types of programs serve as a platform for all employees to learn about our culture and grow personally and professionally with us in order to meet the business needs of our partners’ today and tomorrow.

About Dan Kiely:

Dan Kiely is an entrepreneur through and through. Heading up Voxpro - powered by TELUS International, Dan thrives in the entrepreneurial realm. He dreams big and encourages innovation in all aspects of his company. Dan is now also a member of the TELUS International leadership team with TELUS International President and CEO, Jeffrey Puritt.

The private sector outsourcing market soared to a three-year high in 2017 as businesses signed contracts worth £4.93 billion, according to the Arvato UK Outsourcing Index.

The research, compiled by business outsourcing partner Arvato and industry analyst NelsonHall, found that the total value of contracts signed by UK companies rose 36% year-on-year, from £3.62 billion in 2016 and £1.84 billion in 2015.

Overall the UK outsourcing market saw an increase of nine% year-on-year in 2017, with contracts worth £6.74 billion agreed by the public and private sectors over the period.

A surge in technology investment was behind the strong performance in the private sector, according to the findings. Businesses spent £3.82 billion on procuring IT Outsourcing (ITO contracts) agreements in 2017, more than double the value of deals agreed in 2016 (£1.73 billion).

The analysis shows that companies focused their spending on securing multi-process IT deals, which included new hosting services, equipment, network infrastructure, data centres and application management.

Customer services accounted for almost half (46%) of business process outsourcing (BPO) agreements signed by companies last year. Firms spent a total of £508 million as they looked to deliver improvements in customer experience across traditional and digital channels, according to the findings.

Debra Maxwell, CEO, CRM Solutions UK & Ireland, Arvato, said: “The private sector is increasingly outsourcing more sophisticated work, with firms turning to external partners to introduce new technology and enhance the customer experience.

“This shift towards greater complexity is contributing to more outsourced services being delivered here in the UK. Just two% of private sector deals procured last year will be delivered offshore, compared to 12% in 2016, as outsourcing continues to move up the value chain.”

Overall, fewer deals were agreed across the UK outsourcing market last year, with 98 procured compared to 165 in the 12 months previous, according to the research.

The rise in spending in the private sector market comes as activity across the government market fell year-on-year. Central government departments and councils signed contracts worth £1.82 billion in 2017 compared with £2.59 billion in 2016 – a 30% drop.

Excluding work procured for healthcare, the data shows that the average value of deals signed across government was down 42% year-on-year in 2017

Debra Maxwell added, “In line with calls for a review of the government outsourcing model, the findings show the public sector is already moving away from procuring long-term, high value outsourcing contracts.

“Councils and central government departments are now accessing the technology and expertise they need to deliver a range of functions, from digital service transformation to cyber security, through smaller contracts for productised services.”

Financial services leads private sector growth

The analysis shows that a sharp rise in the value of outsourcing contracts procured by financial services businesses was behind the growth in private sector spend last year.

Companies across financial services agreed deals worth £3.26 billion in 2017, more than treble the total value of contracts agreed in the previous year (£829 million).

According to the research, the growth can be attributed to a sharp increase in ITO spending as firms turned their attention to deals in application management, application hosting and end user computing. The findings show ITO contracts worth £2.70 billion were signed across the sector last year, up from £208 million in 2016.

Pat Quinn, CEO of Arvato Financial Solutions UK & Ireland, said: “Financial services businesses are under pressure to transform, particularly in the wake of high profile security threats and the upcoming GDPR obligations.

“The findings show that a growing number of companies see outsourcing as key to addressing the challenge, delivering the resilient infrastructure and architecture they need to protect against cyber-attacks, keep their data safe and comply with new privacy legislation.”

Alongside financial services, telecoms & media and energy & utilities were the most active sectors in the UK outsourcing market, procuring deals worth £1.08 billion and £279 million respectively, according to the findings.

The research showed that the average value of contracts signed across the private sector more than doubled to £91 million in 2017, from £36 million in the previous year.

(Source: Arvato UK & Ireland)

With 28,000 team members across North and Central America, Europe and Asia, TELUS International is a global business process outsourcing (BPO) provider that delivers contact center, information technology and advisory solutions across fast-growing technology, financial services and FinTech, travel and hospitality and healthcare industries.

Michael Ringman is TELUS International’s Chief Information Officer, where he is responsible for supporting omnichannel solutions that enable the rapid growth and evolution of the company’s clients’ brands. Here, Mike discusses the rise of omnichannel to deliver a personalised and connected customer experience that is critical for brands in our increasingly digitized world.   

Omnichannel is still considered a relatively new strategy when discussing customer service delivery. What is omnichannel and why is it becoming the new norm for brands wanting to deliver exceptional customer experiences?

Nowadays, consumers are using an average of five connected devices to access voice, email, chat, social media and self-service when conducting product research and completing purchases. In response to this changing dynamic between consumer and brand, companies must keep pace by offering multiple touchpoints in order to provide seamless connections and instant gratification as customers switch between an e-commerce site, to a smartphone, to a physical store.

An omnichannel strategy involves these cohesive channels, working together to create a unified brand experience, ensuring the customer gets the same service, support, and information, regardless of how they interact with the brand. Unfortunately, in many companies, these channels still often exist in silos, or at best, a multichannel environment where multiple support channel are offered but not necessarily integrated with one another

With customer service outpacing the product as a deciding factor in many instances, brands must evolve to an omnichannel strategy to keep their customers. In fact, according to a study by the Aberdeen Group, companies with an omnichannel strategy retain on average 89% of their customers, compared to 33% for companies with weak omnichannel customer engagement.

Are there particular industries that should be incorporating omnichannel strategies?

Beyond retail, where omnichannel had its start, today’s booming online sales and customer growth across all industries, including  banking, healthcare and travel, have made keeping up with consumer behaviour a universal objective. Consumer goods and customer-facing brands, both big and small, need to meet service and efficiency challenges across multiple channels. The new kids on the block – the industry disruptors like Airbnb and Uber – have been focused on delivering a connected, convenient and personalized omnichannel experience right from the start of their business. It’s part of their mentality and company DNA in order to differentiate themselves from established brands. The pressure is now on traditional businesses to make the shift to omnichannel.

How can a company assess their readiness to transition to omnichannel?

When contemplating a shift to omnichannel, it’s important to recognize that it’s not simply about technology. A successful omnichannel strategy will be a blend of people, processes and technology. In order to create and implement a clear strategy, it’s important to understand both the key challenges and requirements needed for effective enablement, which can be split across two categories – human capital and technology. It may sound odd coming from someone in the IT sector, but I would argue that people take precedence over technology. It’s not just the physical setup that needs to change, but how an organisation thinks about—and manages—its business.

You need the support of the entire organisation to foster a culture that is ready to embrace a customer's first paradigm shift, including C-level executives who can remove any silos that may exist, as well as knowledgeable and inspired contact center agents who are able to engage with customers across different channels. To help companies assess their readiness to transition to omnichannel, Everest Group in partnership with TELUS International released an assessment checklist that covers all aspects of making the jump.

The move to omnichannel can be a daunting proposition for some. How can companies plan ahead to make the shift less intimidating while also increasing their likelihood of success?

The initial focus should be to understand where your company stands today in its omnichannel readiness – and where it wants to go. Once established, companies need to ensure they build the following critical success factors into their planning: ensure a customer-centric approach, secure the direct involvement and support of senior leadership, ready the organisation for change on both the people and technology fronts, and align corporate culture with omnichannel imperatives by fostering the right mindset and behaviours among the entire team. By bringing into line people, processes and technology requirements before making the transition, you can expect to drive an enhanced customer experience, see a top-line impact and experience a reduced cost of operations.

Once a company has made or has started to make the transition to omnichannel, how can they measure their success and ensure that they are on the right track to meeting their targets and goals?

When implementing and measuring the success of an omnichannel strategy, you must be aware of the need to adjust key performance indicators (KPIs). This should include adding in, or in some instances, swapping out ‘unfriendly’ customer service metrics for more meaningful and ‘human’ metrics.

Average Handle Time (AHT) is a great example of a metric that only offers a two-dimensional perspective of a three-dimensional world. For example, an agent’s handle time may be high; but what if the customer’s experience was improved because the agent took the extra time to assist him with an issue?

In the age of omnichannel, brands should focus on metrics like First Call Resolution (FCR), which will be a much better indicator of great customer service and will give agents ‘permission’ to take the necessary time to fully address a customer’s issues and own the customer experience from start to finish. Other KPIs, such as Customer Satisfaction (CSAT), Net Promoter Score (NPS) and Likelihood to Recommend (L2R), are great for getting customers to self-report how they view their relationship with the brand, which provides another layer of data that will help brands better understand their customers and further personalise their experience in the future.

How can brands get the most out of their omnichannel data once implemented?

In order to capitalise on an omnichannel strategy post-implementation, the type of data you collect as well as how you store and analyse it should be a key consideration. It’s important to capture both big data (e.g.: tracking searches on your website) and small data (e.g.: one-on-one conversations between an agent and a customer) from each of your different channels, and to store it in a central data repository. This enables you to analyze it by channel to quickly identify channel-specific challenges, but also affords you the opportunity to view it as a whole in order to help highlight your customers’ likes, dislikes and habits. Leveraged in a thoughtful and timely fashion, this data will reduce reaction times to problems and help to  proactively address them in some instances; identify trends in what your customers want and how, when and where they want it; and inform the evolution of your product(s) so that you continue to meet the wants and needs of consumers.

What do you see as the future of omnichannel?

In the near future, an omnichannel customer experience won’t be a ‘nice to have’; it will be a matter of survival for brands in competitive industries as customer service becomes increasingly prioritized by consumers. Customer service will no longer be about voice, chat, digital and email support in isolation. Instead a blend of channels, supporting integrated customer interactions will become an established consumer expectation. Complemented by the rise in artificial intelligence as well as more skilled and knowledgeable agents, omnichannel will foster an increasingly personalised and consistent customer experience to further differentiate brands to an ever wider set of customers.

Website: https://www.telusinternational.com/

The UK outsourcing market recorded its strongest half year performance since 2012 between January and June as financial services companies ramped up activity, according to the Arvato UK Outsourcing Index.

The research, compiled by outsourcing provider Arvato and industry analyst NelsonHall, revealed outsourcing deals worth £5.2 billion were agreed in the first six months of the year, with financial services accounting for 55 % of the total contract value at £2.9 billion.

The sector’s investment in outsourcing services was behind a steep increase in spending by UK businesses, according to the findings. Companies signed contracts worth £4.5 billion between January and June, representing a 95 % year-on-year rise. The latest figures follow a particularly strong first quarter, which saw firms agree deals worth £2.5 billion - the strongest quarterly private sector spend since the last three months of 2011 (£6.4 billion).

IT outsourcing (ITO) contracts accounted for the majority of private sector procurement in H1, with deals agreed worth £3.8 billion, up from £1.2 billion in the first six months of 2016. Application management and hosting were the most popular service lines procured by the private sector, as businesses focused on digital transformation.

The overall value of UK outsourcing contracts signed in the first six months of 2017 represents the largest half year spend since H1 2012 (£5.6 billion), and a 23 % year-on-year rise.

Debra Maxwell, CEO, CRM Solutions UK & Ireland, Arvato, said: “It’s clear from the research findings that we are yet to see any impact of Brexit on the sector as businesses continue to invest in new technology and transforming their services.”

Security concerns drive outsourcing spend in financial services

Financial services businesses signed outsourcing contracts worth £2.9 billion in the first half of the year, a steep rise from the £428 million agreed in the first six months of 2016.

An increased demand for outsourcing IT services, specifically network infrastructure, security architecture and cloud computing, was behind the rise, according to the findings. The sector accounted for 62 % of total ITO spend in H1 2017, compared to just five % over the same period last year.

Patrick Quinn, CEO of Arvato Financial Solutions UK & Ireland, said: “Strengthening security and data protection are top of the agenda for the sector and businesses are increasingly turning to partners to deliver resilient infrastructure and architecture in the wake of high profile cyber-attacks and to prepare for the new data privacy legislation.”

Improving customer service drives growth in energy and utilities sector

The number of deals agreed by energy and utilities businesses over the first six months of 2017 rose by 20 cent year-on-year, according to the latest Index findings.

Companies signed outsourcing contracts worth £268 million over the period, up 10 % on the value of deals agreed between January and June 2016.

The research reveals an increase in BPO spend is behind the rise, specifically investment in customer services and collections. Energy and utilities firms spent £164 million improving customer experience in H1 2017, compared to the £4 million invested by the sector on BPO during the same period in 2016.

The Arvato UK Outsourcing Index is compiled by leading BPO and IT outsourcing research and analysis firm Nelson Hall, in partnership with Arvato UK. The research is based on an analysis of all outsourcing contracts procured in the UK market during H1 2017.

Other headlines from the H1 2017 Index include:

Overall, 87 % of spend came from the private sector, with government bodies accounting for the remaining 13 %.

A total of £882 million was spent on business process outsourcing (BPO) deals, representing 17 % of the overall UK outsourcing spend.

The value of ITO contracts accounted for 83 % of the UK market, with contracts signed worth £4.2 billion.

(Source: Arvato UK & Ireland)

The UK’s private sector outsourcing market recorded its strongest quarterly performance in five years in Q1, with businesses agreeing deals worth £2.42 billion, according to the Arvato UK Outsourcing Index.

The research, compiled by business process outsourcing (BPO) partner Arvato and industry analyst NelsonHall, revealed the largest private sector spend since Q4 2011 (£4.04 billion) as companies ramped-up investment in digital transformation.

Of the £1.74 billion spent by businesses on IT outsourcing (ITO) in Q1, 68% (£1.65 billion) was invested in introducing new technology projects, compared with £217 million in January to March last year.

The findings show continued commitment to improving customer experience also led to an increase in spending on BPO deals in Q1. Companies signed customer service outsourcing contracts worth £437 million in the first three months of 2017, with the overall value of private sector BPO deals more than doubling year-on-year to £682 million (Q1 2016: £284 million), according to the research.

Debra Maxwell, CEO of CRM Solutions, Arvato UK & Ireland, said: “The strong start to the year illustrates the resilience of the UK outsourcing market to political and economic pressures, with companies increasingly seeing value in procuring external expertise and experience. From improving customer experiences to delivering new efficiencies across the front and back office, continuing to innovate is crucial to stay ahead of the game, and business leaders are turning to outsourcing partners for selecting and implementing the technology that can help differentiate them in increasingly competitive markets.”

Overall, the findings revealed outsourcing contracts worth £2.73 billion were signed across the UK public and private sectors between January and March, representing a 13% year-on-year rise.

The research found that services outsourced in the UK are being increasingly delivered onshore. No deals agreed in Q1 are to be delivered fully overseas, compared with six% in Q1 2016 and eight% in the period October to December last year.

According to the research partners, a decrease in government spend was partly responsible for the drop in contract volume from 49 agreed in Q1 2016 to 22 in the same period this year, as public sector organisations adopt a ‘wait and see’ approach in the wake of Brexit and the upcoming General Election. Government departments spent £304 million on outsourcing in Q1, compared to £1.6 billion in January to March 2016.

Telecoms investment rise driven by customer services

The telecoms sector accounted for 18% of all UK outsourcing deals agreed between January and March, according to the findings.

The value of contracts signed by businesses across the industry more than doubled year-on-year, with agreements worth £514 million procured in Q1 compared to £217 million in the same period in 2016.

The research reveals significant investment in improving customer experience is behind the rise. Companies in the sector agreed deals for customer service worth £274 million in the first three months of the year, up from the £126 million spent in Q1 2016.

Debra Maxwell added: “The telecoms sector is an intensely competitive marketplace and exceptional customer service is now a key differentiator. Providing a seamless customer journey across digital and traditional channels is key, and a growing number of operators are partnering with third party experts to deliver outstanding experiences.”

The Arvato UK Outsourcing Index is compiled by leading BPO and IT outsourcing research and analysis firm Nelson Hall, in partnership with Arvato UK. The research is based on an analysis of all outsourcing contracts procured in the UK market during Q1 2017.

Other headlines from the Q1 2017 Index include:

• Overall 89% of spend came from the private sector, with 11% coming from government bodies.
• A total of £846 million was spent on business process outsourcing (BPO) deals, representing 31% of the overall UK outsourcing spend.
• The value of ITO contracts accounted for 69% of the UK market, with contracts signed last year worth £1.88 billion.

(Source: Arvato UK & Ireland)