Data Entry and Data Processing Outsourcing: A Complete Guide

  

Businesses generate and receive large amounts of information every day. Customer records, invoices, forms, applications, spreadsheets, product information, documents, and many other types of data need to be entered, organized, checked, and maintained.

Managing this work can require considerable time, particularly when employees need to perform repetitive data-related tasks alongside their main responsibilities.

Data entry and data processing outsourcing allows businesses to assign selected data-related activities to an external service provider. The provider performs the agreed work according to the company's instructions, procedures, quality standards, and deadlines.

This guide explains what data entry and data processing involve, the types of work that can be outsourced, the potential benefits and challenges, and important factors businesses should consider before outsourcing.

What Is Data Entry?

Data entry is the process of entering information into a computer system, database, spreadsheet, software application, or other digital record.

The information may come from many different sources, including:

  • Paper documents

  • Forms

  • Invoices

  • Receipts

  • PDF files

  • Scanned documents

  • Emails

  • Online forms

  • Audio or text files

  • Existing databases

  • Business records

For example, a business may receive hundreds of customer forms containing names, addresses, telephone numbers, email addresses, and other information. Someone needs to transfer that information into the company's database.

That activity is generally considered data entry.

What Is Data Processing?

Data processing involves working with information after it has been collected.

It can include activities such as:

  • Organizing information

  • Sorting records

  • Checking data

  • Cleaning incorrect information

  • Removing duplicate records

  • Converting data between formats

  • Updating databases

  • Combining information from different sources

  • Preparing reports

  • Categorizing records

Data processing can therefore involve more than simply typing information into a computer.

A business may use data processing to transform raw information into an organized format that can be used for business operations and analysis.

Data Entry vs Data Processing

The two terms are closely related, but they are not exactly the same.

Data entry generally focuses on entering or recording information.

Data processing involves handling, organizing, checking, transforming, or preparing information for further use.

For example, entering customer details from paper forms into a spreadsheet is data entry.

Checking those records for duplicate customers, correcting formatting, organizing the records, and preparing them for import into a database is data processing.

A single outsourcing project may include both types of activities.

Why Do Businesses Outsource Data Entry?

Data entry often involves repetitive tasks that require accuracy and concentration.

Businesses may outsource this work for several reasons.

Reducing Internal Workload

Employees may spend many hours entering information that does not require their full professional expertise.

Outsourcing some of these tasks can allow internal employees to concentrate on other responsibilities.

Managing Large Volumes of Data

A business may receive a large amount of information during a particular period.

For example, a company may need to process thousands of forms after a marketing campaign, customer registration process, survey, or business transaction.

An external team can provide additional capacity for this workload.

Access to Dedicated Staff

Some outsourcing providers maintain teams specifically for data-related work.

This can allow a business to assign repetitive data activities to people whose primary responsibility is handling those tasks.

Flexible Support

Some businesses need data entry regularly, while others