Wednesday, May 09, 2012
Horizontal business process outsourcing (BPO) is a core part of the outsourcing market, but vertical business process outsourcing is trending.
Horizontal business process outsourcing has long since been a valuable part of many business processes. Offloading non-core business functions to qualified service providers is a way for businesses to cut costs by capitalizing on economies of scale and efficiency expertise that these services can provide.
However, as the economy recovers and businesses seek more progressive business management strategies, a new vertical business process outsourcing model has evolved. Vertical business process outsourcing calls for providers to manage a businesses more complex industry specific work.
Using vertical BPO services for new product development initiatives and enterprise service functions is becoming more profitable for companies as more providers emerge in the outsourcing space.
The financial services industry provides one example of a vertical business processing opportunity. The Dodd-Frank Act, released in 2010, provides an outline for regulatory reform that will affect nearly all sectors of the financial industry. These regulations will add significant administrative workloads for many firms and using vertical business process outsourcing to offset any business disruption and process this documentation efficiently is one way vertical business process outsourcing can be used in the industry.