A big question organizations face when optimizing (or building out) a BPO strategy: Do you consolidate operations with a single provider or distribute them across multiple partners?
There’s no universal right answer, but there are good ideas … and bad ones. If you’re on the road to this decision, you need a map — or at least a clear list of the tradeoffs in each case. I made one for you. 😎
Consolidating with a single BPO provider:
✅ Simpler management and oversight
✅ Unified SLAs, governance, and reporting
✅ Stronger relationship development
✅ Potential cost efficiencies via scale
⚠️ Higher exposure to vendor failure or disruption
⚠️ Limited flexibility across functions or markets
⚠️ Less competitive pressure to drive innovation
⚠️ Difficult transitions if the provider underperforms
Diversifying your BPO vendors:
✅ Access to specialized expertise by function or industry
✅ Built-in performance benchmarking across partners
✅ Geographic and operational risk mitigation
✅ Negotiation leverage through competitive tension
⚠️ Greater management complexity (potentially)
⚠️ More effort required to harmonize tools, workflows, and data
⚠️ Potential for inconsistent CX outcomes across vendors
⚠️ Higher integration and onboarding costs
Some teams prioritize simplicity. Others prioritize specialization. Most just want to avoid failure.