Professional service businesses in the legal, financial services, consulting and insurance industries are in a dynamic state of change due to the current economic climate. Real estate challenges, pricing compression, globalization, and hybrid working models are just a few factors creating pain points that need new solutions.  Organizations are seeking new and creative ways to provide and balance administrative tasks, manage attrition, offer unique and expanded service delivery options, and tackle other niche requirements dependent on the nature of the business. These initiatives are task heavy, time consuming, expert in outsourcing. 

Key observations and trends of the current state of outsourcing in professional service-oriented businesses will be beneficial when exploring strategic business partnerships.  

• In SSON’s “State of the Shared Services & Outsourcing Industry: Global Market Report 2024,” 49% reported a key area of focus as moving from traditional back-office work towards core business support, while 29% were thinking about it.
• Organizations in the financial services industry have found major value in business process outsourcing (BPO) arrangements. According to Fortunly, last year 71% of finance executives turned to outsourcing for a variety of functions.
• According to a market research study by Facts and Factors, the global insurance BPO should experience a compact annual growth rate of 8.8% and reach a value of $9.8 billion by 2028.

In a 2023 study by Law.com and Epiq titled “How Hybrid Work Forever Transformed the Legal Profession,” 59% of law firm leaders reported they had fewer support staff than they did in 2020, making it evident that switching to a new way of working often requires reimagining processes and staffing. In fact, ~ 50% of the respondents reported that their firms already use offsite support centers for administrative and document production tasks. With this in mind, let’s take a look at some reasons outsourcing may be a solid business choice now and, in the future, along with the advantages of entering into such arrangements.

Key Reasons for Considering Outsourcing Arrangements

The way business leaders view outsourcing has changed as more see the value in leveraging technologies and outside expertise. BPOs now have the capabilities to drive impactful operational change and cost savings through innovative technologies, and unique service delivery models and platforms.   In addition to typical back-office functions like mail and printing, there are so many other areas to consider, including:   hospitality, concierge services, hoteling, supply management, virtual and onsite reception service, risk advising, facility management, records and information management, vendor management, marketing and creative strategies, billing, and AV/IT support.

The reasons organizations are already exploring or should consider turning to outsourcing for certain functions are long and varied. It is wholly dependent on the specific organization’s goals, gaps, and pain points. Top contenders include updating tech stacks, training expertise on new tools, service continuity, enhanced efficiency, cost savings, and standardized processes. Outsourcing is also a great option when a specific or unique business need arises for which the organization lacks the resources or subject matter expertise.

In a hybrid working environment, having access to a service delivery platform is critical to ensure support is available, beyond the traditional normal business hours, and available in a ‘follow the sun’ fashion, if appropriate. BPOs that offer consultation and capabilities beyond traditional models can provide a deeper consultative relationship. Organizations can benefit from technology-agnostic practices that meet specific needs and are flexible.

Outsourcing Benefits in Current Business Climate

There are several advantages to an outsourcing arrangement, the primary being the ability to elevate services, through expertise and delivering operational cost savings. This creates more time to focus on managing caseloads, strategizing, and important business initiatives that may have fallen by the wayside due to lack of time. 

Let us look more closely at the benefit of being able to shift focus to enterprise-level business initiatives. In a hybrid environment, some initiatives will require more attention. The hybrid work study found that 71% of law firm leaders view talent recruitment and retention as top priorities. The same group ranked employee engagement and culture at 59%. These are examples of pain points made more challenging by remote arrangements that create gaps interfering with operational goals.

Leveraging a BPO to relieve administrative duties such as managing facilities, curating a top-tier hospitality experience, and running the back office can prove pivotal to closing these gaps. Doing so takes that off their plates, providing room to focus more deliberately on culture building, recruitment, retention, and fostering an environment of belonging. The benefits of partnering with a BPO rings true in all industries currently experiencing similar pain points due to the hybrid environment and related factors.

Conclusion

Entering into new or enhanced outsourcing arrangements provides organizations with alternative solutions they may never have considered. Forward-thinking strategies with outsourcing partners can prove crucial to maintaining business continuity. This is especially true in a hybrid environment where certain operational challenges are amplified or more time is needed to focus on talent and culture initiatives.