When to opt for in-house BPM?

Recent years has experienced an increased popularity for Business Process Management (BPM) services, since the same offers considerable reduction in cost along with vast supply of cheap and skillful resources. However, many firms at some point of time in their growth cycle opt for bringing some of the business processes in-house.

Insourcing vs outsourcing. Image source:http://syncronet.net

It is interesting to see when the firms should think of bringing in BPM services in-house. The article discusses some of the contexts where in-house BPM is better when compared to outsourcing it to third party vendors.

Fixed cost less than variable cost

Reducing the fixed cost was one of the prime attractions behind the adaption of BPM services in business houses especially when they are small. However, as firms grow up and their operations scale up, there is a possibility that variable cost tend to increase over fixed cost. In such situations, it would be good for firms to bring in those processes with very high variable cost back n-house. For example ‘virtual CFO’ (one of the BPM services) from MPR group, helps firms to make ease their financial functions without incurring the cost for a fixed CFO during the initial days of a firm. Once firm grows up, it makes an economic sense to hire a CFO on full time basis than to use their services at the rates given.

Better Strategic Alignment

In-house resources will be better aligned to corporate goals and strategies. Sometimes the effort required to educate a vendor would be too high than investing in in-house resources to execute the strategies set by the firm.

Faster turnaround

Business often faces a situation where they need more work to get done in a short span of time. Having in-house resources will help in speeding up turnaround in such demanding situations. Outsourcing vendors may get delayed as they would have their own priorities. Hence it makes business sense to hire a graphics designer in-house if you have lots of graphics related tasks to do than depending on a vendor.

Better Quality

Business often requires their work to get done faster, cheaper and with improved quality. Such a need can be satisfied by bringing in experts in-house. The advantage is that in-house resources would be more aligned to the quality norms of the firm.

Risk Mitigation and Control

Employing BPM services in-house can reduce the risk factor to a considerable extent. By incorporating BPM services in-house, business can have better control over the processes. For example outsourcing the monitoring process of patient records in a public health organization can prevent its damage due to loss or leakage.

Unified customer experience

Keeping customer servicing operations in-house can provide a uniform customer experience. Rather than outsourcing these services to call centers, customer services offered through the business’s website can incorporate BPM servicing professionals and sales staff under one roof. Such services can improve the reputation of the organization along with better customer services.

Other factors like need for improved IT outcomes, and need for increased performance also depict the necessarily for BPM services in business. BPM service provider must be selected only a comprehensive evaluation process, since their services can have adverse affect on business success.


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