Alleviating the Burden of Back Office Work Through Business Process Outsourcing10/03/2019
Business process outsourcing, or BPO for short, allows oil and gas companies to focus on their most important tasks at hand, whether drilling operations, acquisitions, reporting, or the plethora of activities that must be tended to daily in the oil and gas industry.
Because most organizations strive to streamline costs and operations, BPO proves effective in meeting these demands. The direct and peripheral benefits to outsourcing can be realized immediately and help sustain companies’ short- and long-term goals.
Why Should I Consider Outsourcing? Here are 9 Key Benefits of BPO:
- Cost Predictability – Controlled costs help oil and gas companies trend what it would cost to support growth opportunities from a back-office perspective.
- Services Predictability – Once you’re comfortable outsourcing certain tasks, you can divest additional tasks and responsibilities knowing the service and care you’ll receive.
- Scalability – A BPO firm can scale up or down with a company. No more worrying about employee hiring and firing as the market ebbs and flows.
- Customization – If you’re looking for the equivalent of an FTE, or you just need intermittent help, BPO can customize around your specific needs, work around varying contracts, and shorten the transition services agreements (TSA) period following an acquisition.
- Profitability – Minimal overhead allows companies to realize more profits while still ensuring critical work gets done. Utilizing BPO and reducing the strain also allows key leadership to hone in on whether company assets (wells) are making money.
- Staff Extension – A BPO firm is like an extension of your full-time staff. There is no lapse in work getting done and oil and gas companies can have utmost confidence in the partnership. Further, ongoing meetings between parties provide clarity and the opportunity to ask questions.
- Data Access – All data that a BPO firm handles is made accessible to their client. In other words, your upstream oil and gas company has direct access to the data that’s critical in making important business decisions and improving E&P operations.
- Easy Reporting – If you don’t want to trudge through data, a BPO firm can provide detailed reports that make analyzing performance – by company, well, groups of wells, or even basin – a breeze.
- Industry Experts – Just like your company represents a specific market, so do BPO firms. Ensure you partner with one that’s solely focused on oil and gas.
What BPO Handles (And What You Don’t Have To)
- Staffing – eliminates the burden on HR to hire full-time staff
- Revenue reporting and payment processing
- Regulatory reporting
- Joint interest accounting
- Accounts payable and payment processing
- Property administration
- Financial reporting and lease operating statement preparation
- IT functions – software selection, implementation, support, and maintenance
- Technical knowledge and know-how
- SOX and technical compliance requirements
Business process outsourcing can alleviate the burden of back office work in upstream oil and gas, allowing a company to focus on its core objectives and ensure its assets are profitable. BPO can be a key component for startups, equity-backed oil and gas companies looking to grow, and resource-strapped firms trying to streamline operations.
Interested in learning if BPO might be right for your business? Let us build you a custom cost model that breaks down costs of BPO vs. buying software and hiring FTEs. Contact Jacob Lopez to get your cost model!