Getting the optimum from outsourcing your business processes

Good advice on ProMark Business Process Outsourcing from both sides of the table

Increased competition and the constant expectation to improve productivity while also minimising costs puts many a business under growing pressure.

This is why more and more businesses choose to hand over the responsibility for one or more tasks to external business partners – referred to as 'business process outsourcing'.

Why Business Process Outsourcing? There are many reasons why a company may decide to outsource. The decision might be strategic, with the aim of saving time and money and freeing up internal resources to focus on developing the company’s core business.  The decision could also be driven by the fact that the company finds itself in a crisis (or on a burning platform) due to a lack of manpower/competence either because it is hard to recruit the necessary competence or because expertise leaves the company. It could also be the need to access the latest technology without having to invest in it themselves.

WHAT IS BUSINESS PROCESS OUTSOURCING? The term outsourcing means that companies allow an external provider to take care of activities previously taken care of by themselves. Business Process Outsourcing (BPO) is a component of outsourcing. BPO refers to handing over one or more (IT intensive) business processes to an external partner, who then executes the processes based on a number of defined and measurable performance parameters. Examples of processes that are commonly outsourced are HR, payroll, accounting and call centre/meeting booking activities.

Some of the benefits of outsourcing one or more of the company’s processes are:

• Increased flexibility and the possibility to focus on the company’s core business
• Lower costs and greater predictability in the budget
• Access to the latest technology without having to invest in it yourself
• Access to the necessary competencies without spending time and money on recruiting and training new employees
• Opportunity to reduce vulnerability and avoid bottlenecks and too great a dependency on a few people in a number of key areas (such as HR and IT)

The flip side of outsourcing tasks to an external provider could be that the company loses critical knowledge on its own processes, thus becoming highly dependent on the external partner.

Make everyday life easier with ProMark services

At Mark Information we are noticing rising activity levels at our customers, and an increased need for stability in terms of IT and personnel-related operations and maintenance of critical business systems. 

Therefore, we have developed a range of extended services, that are meant to complement the customer’s resources and competencies and help optimise the investment in ProMark.

HR’s extended arm

Many companies are in a position where they depend on just a few people to manage the ongoing customisation and maintenance of ProMark. This makes the company vulnerable in terms of sick leave, holidays and terminations, etc. 

With SuperuserService we take over the role as the company’s superuser and take care of a number of tasks, including managing payroll preparation, so that data is transferred to the payroll system at the agreed times.

Superuser services can be delivered as a fixed service, where we together with the customer define the tasks that must be performed. The service can also be proportioned in relation to workload peak periods in the company, for example during payroll runs.

This gives the company a stable availability of superusers, frees up time in the HR department to support other tasks and processes that create value and competitive advantage, and will often give significant financial savings. 

SuperuserService at Carlsberg: More time for other HR tasks! Carlsberg has been using ProMark for many years for attendance registration, staff planning and management reporting in order to optimise their resources and achieve improved productivity. They have significantly reduced the administrative burden in terms of managing various employment agreements and get accurate data for correct salary payments. The solution currently covers 1,500 registrants in Denmark  Carlsberg has a shared services centre in Poland that supports HR and accounting for the whole of Europe. However, it is the HR division in Denmark that manages the Danish agreements. Carlsberg has recently outsourced the ProMark superuser tasks to us. This means that we adjust the existing ProMark setup on an ongoing basis, including maintenance of day profiles, agreement adjustments and account setup, while Carlsberg takes care of the day-to-day tasks themselves, e.g. payroll runs. In addition, we help with ad hoc tasks such as clean-up.  According to Compensation & Benefit and Payroll Manager Ulla Christophersen, this partnership is a success: "We have chosen to hand over part of the ProMark tasks to Mark Information so that we do not completely lose the internal knowledge. It is important that we continue to understand the setup of our agreements if we are to work with them. Otherwise, we will become vulnerable. In return we can utilise the experience that Mark Information has from other companies in finding solutions to any problems that may arise, saving ourselves time. The partnership means that we don’t have to have all the competencies ourselves, yet we stay in touch with the operation and understand why, when things don’t go as they should. It gives us more time for other HR tasks". "A 2-party setup like we have with Mark Information is a simple and usable model that works well for us. However, it is important to have a close cooperation with a clear description of roles and responsibilities. When both parties have access to the same system it is necessary to have clear delimitations, so that you don’t tamper with something just because you can. It could have consequences that you didn’t expect",  says HR Supporter Lise Rasmussen. A piece of good advice from Ulla and Lise is to hold regular meetings where you can take the temperature of the cooperation and obtain information on new measures in the solution. And it is of course important that you feel confident in the resources and competencies available to solve the tasks at hand. Relationships are crucial to a good partnership!

Free up time in the IT department

The workload in companies’ IT departments is also noticeable. Increased digitalisation, new systems and more users mean that it can be a challenge to keep track. 

With Application Management Service we can take over the IT operation tasks related to ProMark. We ensure that the system is operating optimally, that the database is optimised and that customers are always on supported version of ProMark. Furthermore, we also ensure that the tasks in each ProMark module run on schedule. This could be, for example, that integrations with other business systems are working so that data can be transferred to the payroll system on time, that reports are executed as agreed, and that data is transferred to the company’s Business Intelligence solution. 

By handing over the ongoing IT operation related tasks to us, the customer frees up time in the IT department to focus on other value-creating tasks, while at the same time securing faster problem solving and increased financial predictability.

Is outsourcing always the solution?

"We are seeing a growing interest for our extended services in the market", says Torkel Olrik, CEO and Country Manager in Mark Information UK. "More and more companies choose to complement and transfer the day-to-day ProMark tasks to us. This reduces their need for having the competences in-house, brings savings and frees up time to focus on other core tasks in the company".

And the complementary element is crucial. Our extended services should be seen as a supplement that frees up time for other value-creating tasks in the company. This could be, for example, better follow-up on sick leave with the purpose of reducing the employee’s absence and ensuring that possible sick leave compensation is applied for in time. Or reduced overtime hours for employees because of better planning. A win-win situation for both the employees and the company!

BPO best practice

The possibility to free up time to focus on more value-creating tasks makes up the entire business case for outsourcing.

However, it is important to find a good balance in terms of the existing organisation. A low degree of outsourcing might perhaps not give the desired effect ... On the other hand, a high degree of outsourcing may result in the company becoming ineffective because it loses sight of the processes and who is responsible for what, miscommunication, and so on. 

Therefore, we believe that a mixed setup is the optimal solution. In this way the customer can retain some level of critical knowledge internally, and ‘challenge’ the supplier. Also, as a supplier we have a single point of contact in-house that we can play ball with, providing the best basis for delivering on the tasks handed over to us.

Thus, business process outsourcing should never entirely replace internal knowledge, but rather be regarded as extra delivery muscle that eases the load from the company’s shoulders.