Moving from BPO to KPO part I
When most people think of outsourcing, they think only of jobs such as call centers, tech support or data entry. In other words, the low-level repetitive tasks that are required to run a business. These types of tasks are generally what make up what is known as BPO – Business Process Outsourcing.
As it became common practice to outsource business operations, outsourced positions gradually extended to include administrative tasks. For instance, we have previously noted how outsourcing Human Resources is a good work-around to having to spend thousands on hiring and developing your own HR department the same goes for other areas, such as marketing and accounting.
The transition in outsourcing is trending to more complex tasks which makes sense as the practice of outsourcing is proving to be beneficial in cutting costs as well as finding the right talent. While open job positions exceed the number of job seekers, companies will have to compete for top talent the alternative, of course, is looking to new markets where a qualified talent pool is more accessible and ready to work.
This growing demand for quality is also what is bringing KPO to the forefront. An acronym for Knowledge Process Outsourcing, this is generally considered to be an extension of BPO. KPO functions in a completely different manner than BPO, however. While BPO refers repetitive activities, KPO relates to more complex tasks that are insight driven and require high collaboration and coordination. While BPO only requires process expertise, KPO requires knowledge expertise.
For instance: while BPO call centers handle processes on behalf of their client, they can also offer KPO services by simultaneously handling the gathered data for the same client. This expansion into KPO services leverages the attractive labor costs of the outsourced activity for higher value services contributing a greater percentage to bottom line profits over BPO services.