Whenever you hear the word outsourcing, the words BPO, KPI and SLA will also probably cross your mind.
BPO (which means Business Process Outsourcing), is an increasingly popular business practice wherein a company engages the services of another to perform business functions, necessary for them to achieve efficiency and productivity.
The agreement entered into by both parties are then governed by an SLA or Service Level Agreements which are measurable through KPIs or Key Performance Indicators.
Service Level Agreement
The agreed SLA establishes the baseline performance levels of a BPO company. It provides a clear guideline of specific services to be rendered, metrics (KPIs) by which the offered services will be measured, duties and responsibilities of both parties – the hiring and the BPO company.
It also enumerates the remedies and penalties for breach, and instructions on how to go about changes or adjustments to the agreed SLA, should the need arise.
What Makes up an SLA?
Similar to any other standard contracts, several components are making up an SLA. They can be broken down as follows:
Services the BPO company promises to deliver
It is critical for the hiring company to lay out their expectations clearly, particularly on what they intend to get out of the partnership. Exact services that will determine the standards of the results must be enumerated so that no confusion or miscommunication arises.
Responsibility of Both Parties
Further to component one, the duties of the hiring company must also be explicitly enumerated in the agreement. Both parties must understand each other’s expectations so that no one feels at a disadvantage.
Turnaround Response Times
Response timeframes must also be clearly defined and agreed on. Like how long should an incoming email or call, when received from a customer, is responded to. This also includes, in a call center setting, how fast an incoming call is answered.
It is also important to agree on a set of guidelines and procedures to follow if any disputes happen. Although conflicts can vary depending on the situation, a clear cut set of instructions will give directions on how to resolve any disagreements.
Penalties/Consequences for Failing to Meet Service Expectations
Having a defined penalty and clearly stated repercussions for failing to meet service expectations brings assurance to the hiring company that the partner BPO company will always aim to deliver above and beyond service. It also helps set the bar of the quality of service expected and at the same time a goal for the BPO partner to achieve.
Having a set date agreed upon by both parties for payment completes the fundamental component of an SLA. Setting the time allows both parties to know exactly when to expect payment and the consequences that come with it if it is delayed.
Why is it Important?
For companies venturing into outsourcing, having a Service Level Agreement with your partner BPO company ensures working relations go smoothly. It ensures both parties are aware of each other’s expectations and responsibilities. Most importantly, when disagreements arise, it provides the guidelines on how to resolve your conflict.
Thinking of outsourcing some of your office tasks to the Philippines? Select Voicecom offers a diverse portfolio of BPO services such as data mining, claims filing and submission, contract processing at a price you can afford. We won’t even tie you down with a long-term service contract as our plans are flexible to suit your business needs.
Curious to know more, reach out to us today to get your free quote!