Nearshore Americas
cloud-based bpos

Nimble and Tech Savvy, Cloud-Based BPOs Expose Weaknesses in “Old Economy” Model

The evolution of the BPO industry is being shaped by the cloud, with smaller, nimbler start-ups taking advantage of the lower barriers to entry that the cloud offers. While the last few years have seen the creation and domination of very large BPOs, resulting from numerous mergers and acquisitions, going forward, the industry will see the emergence of cloud-based BPOs. New entrants will arise to meet evolving market needs, that even the large BPOs – most having built their business in the era of the “old economy” –  cannot address.

Connectivity Advantages of Cloud

Start-ups in the BPO space that are 100% cloud-based are positioned to compete with even the huge players, because of the flexibility, agility, and customizability that such new entrants will offer. Eight to 10 years ago, the main driver of how one could deploy BPO services was 1) dedicated circuit connectivity, and 2) big box PBX equipment.

Fast and reliable connectivity is still essential, but the Internet offers equivalent or better connectivity than dedicated circuits can, and it is more stable and dependable than it was a decade ago, and with higher bandwidth capacity.

Beyond CAPEX Investment

Cloud deployment also brings benefits in terms of equipment cost. Cloud-based BPOs buy Software-as-a-Service (SaaS) to provide for PBX functionality, eliminate the vast up-front PBX CAPEX costs, and therefore do not have to pass them on to their clients. This way, they avoid a significant constraint that the industry’s large BPO players have due to their need to amortize legacy systems. These investments in expensive equipment are restrictive on the large BPOs; whether Avaya, Genesys, or Aspect PBX, BPOs had to make large purchases, and then secure enough clients to support those costs. This has been a significant barrier to entry for new BPO providers, has kept prices to clients high.

By using cloud-based PBX solutions, these barriers to entry for new industry entrants have been reduced; the result is the rise of companies like Iterum, whose model is based on being nimble, customer-centric, and 100% cloud-based.

Cloud technologies are not simple; they all have their degree of complexity and require a new service delivery paradigm. The benefits in flexibility, easier integration, collaboration across systems, the scalability of deployment, and, most importantly, the enhancement of customer experience clearly increase the value-add to clients.

Agile, Flexible, Customizable Cloud

Cloud-based BPOs can deploy seats and people quicker than any of the older, larger competitors because they have that flexibility. Systems are adjustable, can be customized, and both clients and providers can access them easily.

Big companies that invested heavily in large-scale equipment in the past are now tied to those technologies because those are the ones that they have in place.

The cost of replacement becomes an essential factor. These companies have to depreciate all this equipment before they can move to the cloud, whereas cloud-based BPO start-ups and are built on a cloud solution; they don’t have those legacy decision anchoring them to the past.

Clients realize big benefits from cloud-based BPO delivery as well, in the form of standardization and accessibility. With Amazon Web Services, for example, wherever it is deployed, there is a set of standards that clients know providers will be compliant with. Many clients even use the same cloud providers as their service providers use.

Accessibility is through the web in a cloud-based environment so that clients can monitor the BPO calls remotely from any location. There is compatibility in such systems that facilitates communication between clients and their providers.

Voice and Data Integration, True Omnichannel Capabilities

Another advantage of cloud-based BPO providers is that integration across voice and data is automatic.  With legacy systems, voice is routed through a PBX, while data (that contact center agents need to access) is routed through the Internet, through whichever web applications are being used. There set up requires Computer Telephony Integration (CTI) to make sure that what was processed on the voice side is correctly correlated to the data side. Conversely, with cloud-based systems, voice and data are both routed together, eliminating the need for CTI, simplifying set up, reducing implementation time, and increasing reliability.

Sign up for our Nearshore Americas newsletter:

Cloud-based BPO technology platforms are also able to offer actual omnichannel communication, which is a significant advantage, and where the industry is inevitably headed. Omnichannel communication means that end-users (the clients’ customers) can get support in their preferred methods of contact (email, SMS text, live chat, social media, voice, or a combination of those). Also, the agent providing that support will have access to all necessary information, including prior contacts with that customer, across all channels. All the interactions are on the same platform; agents, and the client, can access the history of the issues affecting the customer efficiently and quickly.

In an ever-changing market, it is clear that transactions of consumers are indeed evolving. Next-generation, cloud-based BPOs not only handle the current transaction requirements but are also well positioned to support their clients’ future needs. Companies that can adapt more quickly, and evolve more efficiently, will thrive in the near future; those that do not will become obsolete.

Miro Batista

Results-driven executive with a track record in growing businesses. He has a collaborative leadership style, having successfully assembled high impact operating teams across multiple countries and cultures, always considering clients' needs. He has an extensive understanding of the Latin American region, which has helped increase success to clients while maximizing shareholder value. After more than 15 years working in the corporate world within the Latin American region, Miro started with Iterum Connections. On his time off he enjoys cycling and crossfit.

Add comment