Business Process Outsourcing (BPO) is a section of the outsourcing services where a third party provider is employed to carry out the non-core operations of the business.
The fundamental objective of any business since the beginning of the industrial revolution has been to maximize profits and gain and maintain a competitive advantage in the market.
Although outsourcing was not introduced until much later, it can identify as a business strategy for organizations to reduce costs and improve their bottom line by saving up on labor and operations expenses. Outsourcing also provides the business with opportunities to prioritize their core objectives to increase their productivity and growth.
Now moving back to Business process outsourcing, their services deal with specific responsibilities that can categorize as either the front office or the back office functions.
The front-office outsourcing is more of a customer-based service that includes interaction with the clients or in this case the consumers through business activities such as marketing, maintenance, conversing through the phone or modes like emails, faxes, etc.
The back-office outsourcing is a little more complicated than that; it includes services that deal with the internal activities of a business such as the administrative tasks, tasks that encompass departments like operations, human resources, I.T., etc.
Types of services provided in the BPO industry include customer support, insurance, telemarketing, data entry and data processing services, help desk services, accounting, and bookkeeping, etc.
Knowledge process outsourcing (KPO) Difference between BPO and KPO is a subset of BPO that can describe as an outsourcing service that as the name suggests is more knowledge-based and involves the allocation of the high-value core function of the business such as tasks of competitive importance.
These activities can be outsourced to an outside organization or of a different group from the same organization that is from a different geographical location.
The high-level processes carried out by the KPO services include activities like accounting, consultancy, research & development, advanced analysis, etc., which in turn requires highly skilled workers with specialist expertise.
Types of services provided in KPO include market research outsourcing (MRO), legal process outsourcing (LPO), analytics, financial research outsourcing (FRO), etc.
While both of these process outsourcing services sought after in the name of minimizing costs and maximizing the value and profits, there is a noticeable difference between the two terms and the services they provide. Microsoft Visual Studio What’s New?
Some of the fundamental differences that distinguish these two outsourcing services are as follow:
BPO provides more of low-end services as compared to the KPO services that consist of the organization’s core competencies.
BPO services are process oriented, providing consistency in the execution and the outcome of their operations. They are involved in a specific set of activities that are guided by instructions and descriptions.
KPO, on the other hand, does not involve tasks that guided by specific instructions and descriptive scripts. The outcome of these operations are not predictable and consistent like they are in the BPOs, It, in fact, relies more on the knowledge and expertise of the individual carrying out the task.
An employee in the BPOs is required to have the keen understanding of the job, communication skills, language proficiency and basic computer knowledge. Most of these employees do not necessarily have to be highly qualified.
An employee in the KPIs though is required to have specialized knowledge and understanding of the job. They provide high-end services that need individuals with advanced degree and certification in the field. Some of the essential skills include high degree specialist expertise, analytical research, technical competence, etc.
The BPO expertizes in rule-based, process driven activities, while KPO expertizes in Knowledge and specialization that primarily needs interpretation, analysis, and judgment.
As the rise of research process outsourcing (RPO) and analysis process outsourcing (APO) services are increasing and branching out of the KPO industry, BPO is said to be lying at the bottom of this complicated outsourcing family as it is highly monotonous and the simplest.
Although it’s safe to assume that KPIs had emerged from BPOs and KPO is nothing but an extension of the BPO as it matured over time. The business process outsourcing is still considered the lower end value addition to any business as compared to the Knowledge process outsourcing. is Difference between BPO and KPO
It is a known fact that while the salaries and incomes of professionals in KPO are higher than the employees in BPO, the chances of getting a job in BPO is more top and a lot more comfortable than it is in KPO. Simply put, the services provided by the KPO do not just offer specialized assistance, but it drives the growth of the organization.
Thus the growth rate of the KPO service requirement is moving upwards creating an impressive amount of job openings.
And while BPO services are available for the non-core functions of business, providing job opportunities for high school graduates and students looking for part-time jobs.Numerous organizations still avail services and even hold its significance Difference between BPO and KPO