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What Is Back Office Administration?

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  • Written By: Terry Masters
  • Edited By: Shereen Skola
  • Last Modified Date: 27 November 2016
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Back office administration is the management of the departments of a business that do not interface with the public. The composition of a company's back office depends on its underlying industry but often includes administrative and clerical services, technology support and data management. Ordinarily, a company hires staff to manage its back office processes at its headquarters as an integrated part of its operations. A business can use a different management strategy and set up its back office operations at a remote location or outsource some or all of its back office needs to another company to save money.

Management analysis divides business operations into front and back office systems. The front office consists of all of the departments that interact with customers, such as sales and support. These departments are part of the front office because they present the face of the company. Back office operations drive the front of the business and provide support, mostly to the sales effort but also to manage staff and the resources needed to stay in business. Administrative support, accounts receivable and information technology are examples of departments that comprise a company's back office.

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The different back office operations must be managed properly to ensure they continue to support the front office. Back office administration is the process of managing these operations so they achieve business goals and objectives. Typically, each back office department has its own manager, but the entirety of back office management can fall to a dedicated manager or even to the chief operating officer or other chief executive of a company. For example, a college might have a physical plant manager and janitorial services manager who both report to a vice president of operations.

Advancements in technology and the globalization of the labor markets has expanded the functional options for handling back office administration. Businesses can now choose to spin off back office operations to a remote location that has cheaper labor and resource inputs, either under its own management or by outsourcing all or part of the back office to a specialty company. Typically, this type of remote back office administration is located in developing countries. Handling back office administration in this way enables a company to achieve cost savings and a certain type of operational efficiency, since it no longer has to worry about business operations that are not part of the core processes of generating revenue.

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nony
Post 4

@miriam98 - Managers in back office operations have a lot of pressure. They need to justify their head count since the stuff they do has no direct bearing on working with customers.

I can’t count the number of companies I’ve worked at where back office operations were flush with more “analysts” than you could shake a stick at.

At one place they started having layoffs, and back office operations got hit hard. I guess upper management realized that they had been overstaffed (or maybe they didn’t want to get laid off themselves, who knows).

In either case if you are a manager you better make sure that you’re producing and that your back office is delivering cost efficiencies, otherwise you and your operation will be downsized in a hurry.

miriam98
Post 3

@MrMoody - Outsourcing is the biggest threat to back office operations in my opinion, especially in I.T. Companies are outsourcing their basic data management and analysis functions to companies located overseas, where they can get the work done cheaper.

I don’t think it’s safe to be in any facet of information technology these days, frankly. Front office operations are not safe either. Many companies are outsourcing call center operations to countries like India.

I think India has become the world’s headquarters for call center operations. That may be good for a company’s bottom line, but it’s certainly not good for American jobs.

MrMoody
Post 2

@Mammmood - I worked in technical support for years. It was definitely not a back office function, like you said. I often had to field calls from customers who wanted to know why their software didn’t work.

Actually I didn’t mind the job – I interface quite well with the public. It was frustrating at some point however because I had this unyielding creative urge; I wanted to write software, not just support it.

Over time I made my intentions known to upper management and gradually they pulled me into developer roles, but they did ask if I’d be willing to rotate on support from time to time. I said sure, that’s fine. If you’re a developer who can do support, you’re a real value add in my opinion.

Mammmood
Post 1

I prefer working in the back office to working in the front office. I like the quiet, secluded nature of the work that I do. It’s not that I don’t like meeting people; it’s just that I like to get in the “zone” so to speak and need a job where I can work mostly uninterrupted. In case you haven’t figured it out, I work in information technology.

Not all IT jobs are back office. Some people work in support or they work as managers or business analysts. I work as a developer and have limited exposure to others outside my circle and direct report. I like it.

Some of my colleagues talk about moving up the corporate ladder, by which they mean that they want to be lead developers or managers. That’s not for me, however. Just give me my cubicle and some quiet place to work and I’m good.

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