Contracting out your company’s work to be done by a third-party in another country, or off-shore outsourcing, is risky business. Then again, any business is always risky business.

When you understand the risks involved, you can work on overcoming these in order to gain rewards. It’s all about covering such pitfalls to winning windfalls for your company.

Pitfall#1 – Information integrity.

Though many US-based corporations have embraced sending their clerical, customer and technical support processes overseas, there are still some firms whose chief concern is the integrity of confidential client documents and information could be leaked out for gain, stolen or lost.

These companies have become much more reluctant due to recent news of fraud perpetrated by agents of business process outsourcing (BPO) firms based in India where classified customer information of Citibank and HSBC was used in illegal money transfers.

A way to prevent such breaches is to require strong privacy and security standards during your screening of BPO service providers. Investigate and confirm their commitment and capabilities in data protection. Do they regulate and monitor employee access to sensitive information? Do they perform sufficient background checks when hiring new personnel?

Pitfall#2 – Culture conflict

Many companies encounter misunderstanding, miscommunication, a lot of misses actually when interacting with their off-shore counterparts and employees. The cultural gaps are multiple: language, business ideals, ethics and social values.

Export your company’s ideals and standards to be adapted by your BPO service provider in terms of recruiting, operations and quality assurance, through knowledge transfer and guidance by your own company’s accredited trainers who would have to be on-site.

Have this requirement for continuous training issued and implemented in your service contract.

Pitfall#3 – Your BPO service provider

Is your BPO service provider stable enough to sustain your outsourced processes for a certain term? Do they have the adequate facilities, technical and qualified human resources to do the job the way you expect it to be done, and maybe even more?

Selecting the right BPO service provider, as your company’s partner in outsourcing some of your business processes, can help you cover those previously-mention pitfalls and many others.

Outsourcing is a boom industry with a lot of BPO firms rising and staking their claim. You have to be selective in screening potential BPO partners, making sure that they had previous successful experience and proficiency in doing the processes you require to outsource, BPO firms who are totally compliant with the industry standards of not only of their government but also of your government, BPO firms who are up-to-date to the ever-changing trends in commerce and technology while proactively performing their end of the contract.

It is becoming a general preference now to work with smaller, more well-managed BPO firms which can easily monitor their work-force and easily adapt to new technologies, new systems. Such small-scale BPO firms can strive to achieve the product or service quality first, before expanding and emphasizing quantity.

Knowing where the pitfalls are is the first step to moving your company towards success. Impractical business prospects, miscommunication and limited planning can be overcome through cautious study and analysis to ensure your company’s venture through outsourcing becomes both positive and profitable.


  1. Mitchell, Anthony. “Indian Call Center Fraud Case Highlights Need for Change.” 12 April 2005. E-commerce Times. Accessed 23 June 2008. Link here
  2. Rosenthal, Beth. “New Outsourcing Risks in 2005 and How to mitigate them.” January 2005. Outsourcing Journal. Accessed 24 June 2008. Link here


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