Outsourcing – Trends, Benefits and Risks

Getting back office tasks done by a company in a different country or offshore outsourcing as it is called was once considered the domain of big businesses. However, the trend is now gaining traction among small businesses too.  According to a report in CIO Insight, the outsourcing scenario is changing with business process automation and BPO turning to the mid-market. There is a shift to lower contract values and higher deal volumes in the post-recessionary scenario, says the report. Here is a look at current outsourcing trends as well as the benefits and risks involved.

Factors Driving the Outsourcing Decision

Cost cutting is the primary driver of outsourcing. When businesses outsource, they eliminate the costs of hiring an employee including the costs of setting up the necessary infrastructure, employment taxes, management, training, health insurance, employment taxes, and retirement funds. Other factors which prompt the decision to partner with an external service provider include:

* Efficiency: Hiring an in-house team for performing tasks such as data entry, IT, forms processing, or accounting may not be practical in terms of cost and existing infrastructure. Training hired persons also require a lot of time and effort. Outsourcing allows businesses to get these tasks done efficiently and on time. As the BPO company is specialized in these activities, it adds efficiency to its clients’ operations.

* Focus on core operations: Outsourcing is based on the principle of comparative advantages. It allows the client company focus on its core competencies while the outsourcing company focuses on the areas in which it specializes. This arrangement benefits both firms. The client company gains access to exceptional capabilities which it does not possess.

* Flexibility: It is impractical for companies to expand or downsize quickly with changes in global economy. Employees engaged in routine activities cannot be expected to focus on new projects with expansion of business. Outsourcing provides the flexibility to adapt with rising or slowing demand.

* Risk reduction: With the changes in markets and technologies, keeping up  with competition is a big challenge for firms as it requires significant investment. Outsourcing firms make investment on behalf of many clients, and not just a single one. Shared investment stretches risk. 

Challenges Involved

While partnering with an outside vendor, a company would have doubts regarding the timeline and their ability to complete the outsourced task on time. Moreover, there are the inherent risks involved in allowing an outsider to handle some of your operations.

* Security threats: Outsourcing can be a threat to company’s security and confidentiality as it may involve the transfer of sensitive data. For example, when business processes such as payroll are outsourced, it involves the transfer of sensitive information related to salary and social security numbers.

* The issue of control:  There will be some loss of managerial control when operations are sent out of the boundaries of business. Managers often find it more difficult to manage the outsourcing service provider than managing their own employees. Even though processes are customized to meet client specific needs, lack of control may cause discrepancies in the business relationship between a BPO provider and the client.

* Limited flexibility: The feeling of being locked to the same partner is one of the major risks of outsourcing.  Many outsourcing companies now prefer short-term, lower-value contracts, according to experts

* Not all functions can be outsourced: All business operations headed under IT banner are not viable for outsourcing. Business owners should be fully assured that the partner selected would have the capability to handle the outsourced tasks efficiently. 

* Loss of employee morale: Outsourcing can affect employee morale and productivity. Employees actively involved in a specific project may be reassigned or even terminated.  This can affect other employees and cause them to think that their jobs could be at risk.

Most of these risks can be avoided by partnering with the right BPO Company to partner with.

Succeeding with Your Outsourcing Decision

Once you have made the decision to assign some of your tasks to an external service provider, there are some things that you can do to ensure that you have made the right choice. Ask the right questions:

- see if they have responsive customer service and offer timely technical support in emergencies as well as non-emergencies

- Make sure they have an expert team on your project, whether it’s data entry, data mining, document conversion or document management

- Check whether they have methodologies and processes in place to handle unexpected events

- Will they track your progress, provide timely reports and communicate in a way you understand?

- Can they provide you with a comprehensive plan that can meet your business goals while staying within your budget?

Having a clear vision of your goals and communicating these to your outsourcing partner will help to forge a successful relationship with them. Go by research and references to choose the right vendor and insist on a contract plan that covers all aspects of the relationship and costs involved. 

Top 5 Utilities for Converting Paper Documents to PDF

Electronic documentation has become indispensable in all types of businesses. Conversion of paper documents to a digital format like PDF improves accessibility, makes it easy to retrieve information, saves space, and allows sharing across networks. Digitization enhances efficiency and productivity and helps businesses to stay competitive. There are many utilities and tools to convert paper-based documents to PDF format. Each comes with its own specifications. Let’s take a look at five such utilities.

Five Utilities for Converting Scanned Documents to PDF

Soda PDF 6: Soda PDF 6 is a popular PDF application that allows you to open and create a PDF from Word, Excel, and PowerPoint, and other 300+ file formats. You can also scan and perform optical character recognition on paper documents using this utility and convert your PDF files to other formats such as Word, Excel, HTML, .txt and images.

The main modules of this software are:

* Open any type of PDF file
* Create PDF from different file formats
* Convert from PDF to other formats such as Excel, Word, HTML, .txt and images.
* Editing the PDF document:
- Cut copy or paste images
- Changing the font type, size and style
- Extract and Split PDFs into multiple documents
- Moving or deleting pages in a PDF
- Reducing the size of PDF file
- Insert the following functionalities:
- Insert new pages into your document
- Add page numbers and links
- Insert images
- Clip, crop and change image resolution

* Review: This option allows one to:

- Add comments
- Compare and annotate your documents with sticky notes, stamps, shapes and pencil tools
- Mark documents by highlighting, underlining and strikethrough

* Secure: Authentication of documents with passwords and permission levels. The utility allows you to:

- Set and control permission levels
- Manage digital signatures
- Protect documents with 256-bit passwords
- To approve and sign in documents digitally

* Forms: With this module Soda PDF 6 can:

- Generate custom forms
- Add text, check boxes, buttons and other fields
- Manage field sequences and calculations
- Import and export data
- Combine e-mail, submission and print features

* OCR: The Optical Character Recognition module helps to turn PDF, image, or a scanned document in to a fully editable file format. This module allows to:

- Recognize text manually or automatically
- Recognize text within images
- Convert scanned documents into editable and searchable text

Softi Scan

Softi scan is a simple PDF scanning app that can create single and multi-page PDF’s , without compromising quality.

With this software you can
* Create multi page documents even with a flatbed scanner
* Scan both single and multi page documents with high quality
* Usage of G4 TIFF compression allows a typical page to be under 50kb
* Scan to PDF has superior image compression facility, which makes the page quick and easy to e-mail
* Interface seamlessly with nearly all Twain compatible scanners

Advanced Scan to PDF Free

Advanced Scan to PDF Free is free tool for converting paper documents to PDF format. This utility allows you to create quality PDFs from scanner, camera, files, and other sources. While setting up this application, make sure to perform custom installation. Failure to do this may cause the software to install a toolbar, and change your browser home page and your search provider

Features of Advanced Scan to PDF:

* Scan and organize your paper document in PDF format
* Combine multiple documents/images into a single PDF file
* Ability to create a searchable, editable PDF file
* Its built-in preview window allows real-time preview of output files
* Can load images from your hard drive and combine them with a scanned document
* Provides a secure and reliable digital signature verification platform
* Has multi-core CPU technology ─ for advanced and high speed scanning and converting process
* Has advanced compression technology
* Free of spyware, viruses or any other kind of malware
* Provide password protection to PDF files
* Ability to edit scanned images or local images

Readiris Pro

Readiris Pro uses OCR technology to convert any paper document in to PDF format.

The latest version of this utility is Readiris Pro 14. It comes with the following features:

* Documents scanning can be done using a built-in scanning wizard that converts the file to required format, without altering the original layout.
* Easy to create searchable and indexed PDF files
* Its cloud connector provides the facility to store, access and manage the converted documents from cloud.
* Its high compression technology, can reduce the size of images and PDF, allowing files to get compressed up to 50 times smaller than the original size
* Can quickly convert multi-page documents into one or many output files
* Ability to rotate and adjust pages
* Ability to delete blank pages

SolarSys DocScan Pro OCR

SolarSys DocScan Pro OCR is a utility for document scanning and altering them to PDF format. The main features of this utility are as follows:

* Single and batch document scanning
* Storage and retrieval without the complexity of a database
* Automated indexing
* Scan directly for publishing on your Website
* Document templates simplify varied and repetitive scanning tasks

Document scanning and conversion can reducing storage space requirements and record management costs, and streamline access and distribution of information across the organization. With a professional document conversion company you can enjoy economies of scale and benefiting from speedy conversion of voluminous data conversion at affordable cost using the latest software.
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