Outsourcing might have had a bad reputation a decade ago; however, as we observe the landscape today, we find that there has been an increase in the inclination of different businesses relating to different industries towards it. As the CEO of an outsourcing company, Robert Gogel has stated this in more appropriate terms as:
“Outsourcing continues to grow—and its stigma is shrinking.”
This is also evident from the worldwide statistics provided by Statista pertaining to the total revenue generated by the industry in 2017. Unexpectedly, the “global traditional outsourcing industry generated 88.9 billion U.S. dollars (115.8 billion AUD) in revenue”.
Hence, we can say that outsourcing is here to stay and, in fact, it is flourishing by leaps and bounds.
But what makes this industry so lucrative for industries, especially, the Finance, Legal and Consulting industry?
Outsourcing is paying off for a lot of companies in a lot of industries because of its effectiveness. For example, in business management, it is creating new opportunities, creating new markets, providing efficiency, and reducing operating costs for businesses that are trying to get a competitive advantage.
Law firms, insurance agencies, and debt collection companies are also looking to outsource their key functions to markets that offer competitive rates with the requisite quality. In fact, if we talk about the legal process outsourcing (LPO), it is estimated that by 2020, this market would reach well over 11.21 AUD. Similarly, insurance companies are outsourcing their SIUs and the debt collection companies are entrusting external investigative agencies like Ramsey with their debt collection process such as tracking down fleeing debtors.
Whether it is a law firm, debt collection agency, or insurance agency, they all have benefited from the labor arbitrage – a perk of the outsourcing. This means that due to the wage differences in the in-house operating units and the outside or external vendors have made it possible for them to save extra dollars and, in turn, direct those funds to more important processes. For example, for a law firm, an onshore attorney costs around $195/hr while an offshore vendor costs around $95/hr. Talking about the other two sectors, an on-shore or in-house Special Investigation Unit requires the induction of professional employees, their training, and other job-related decisions that collectively cost a fortune. All of this is also true for the debt collecting agencies where they have to spend huge capitals to trace out defaulters and chase fleeing debtor. In both cases, outsourcing has played a part in the reduction of the costs mentioned because the external vendors are:
As you’d know, a company or a firm is made efficient in its roles when its employees are talented. It is this talent that leads to greater problem-solving capacities. This is where outsourcing offers greater benefit. Outsourcing work to offshore companies can allow you to access untapped global talent. There are many talented professionals present in outsourcing destinations, such as Australia, that are waiting to perform simple corporate functions more efficiently. Outsourcing to places like these can help you fill any competency gaps in your internal corporate environment. For example, if you own a legal firm, but do not have a viable litigation support team, you can outsource activities in that area such as document review and coding to companies such as ours – Ramsey Investigation Services. As opposed to this, if you run an insurance company, you can make us a part of your SIU and reap fruits from our investigative expertise. In case you’re the owner of a debt collection agency, we, too, can help you in debt collection as we have helped others.
Outsourcing is just an extension of the internal functions or team. It allows a company to increase its functional bandwidth to achieve maximum output and reduce the overall turnaround time. For example, if your onshore and offshore teams are working together on a project, the time difference between the regions of their operations and the online tools of management and communication would help you achieve the perceived results faster as the teams would work on it with respect to their time zones.
Not only this, in processes like tracing debtors, we know that communication through either sending letters or making phone calls is a big time waster. Any first-party debt collector wasting time on this and also on monitoring key performance regressions because of this can save ample time by having an offshore team working on it for the company. If we talk about tracking insurance frauds, the same amount of time can be saved by letting an external vendor put his best to scourge all the underlying indicators of the fraud, even from a remote area.
As we already alluded to this above, we’d like to elaborate it further.
Compliance or relevancy of the offshore vendor is the major driver of the outsourcing industry in the Finance, Law, and Consultancy. For example, he knows how the insurance industry works, what laws are applicable in the country of the source, and what are the strategies that can be applied to stay in the legal zones of debt collection? Of course, as you’d know, if a vendor cannot comply with the laws of the origin of the company which has hired him, it wouldn’t pay off in anyway. The investment, even little than the on-shore, would pose huge problems in the cash flow of the particular company.
As you can see, offshoring has indeed a great many merits for legal firms, debt collection agencies, and insurance agencies in the four principal areas: cost, time, scaling, and compliance. We are always looking for opportunities to help you scale your business by performing mundane tasks for you like the following:
While we are busy doing these tasks for you, you could invest the saved time and money on your core business processes. However, if you’d like that to happen, please contact us right away. We’re love to hear from you and give you an overview of what we are capable.