Business process outsourcing (BPO) is a subset of outsourcing that involves the contracting of the operations and responsibilities of a specific business process to KTRIAN. It includes the transmission of processes along with the responsibilities and related operational activities to KTRIAN with a guaranteed the same service level and where the KTRIAN includes a firm grip for mutual long term success. BPO is positively associated to the search for more efficient organizational designs which has cost efficient, increase in productivity and capacity of innovativeness.
BPO is often divided into two categories: back office outsourcing, which involves internal business functions such as billing or purchasing, and front office outsourcing, which includes customer-related services such as marketing or tech support. The endless opportunities IT provides, stimulates BPO activities. BPO that is contracted outside a company’s own country is sometimes called offshore outsourcing. BPO that is contracted to a company’s neighboring country is sometimes called near shore outsourcing, and BPO that is contracted within the company’s own country is sometimes called onshore outsourcing. The most common examples of BPO are call centers, human resources, accounting and payroll outsourcing.
Use of a BPO as opposed to an application service provider (ASP) generally also means that a certain amount of risk is transferred to the company that is running the process elements on behalf of the outsourcer. BPO includes the software, the process management, and the people to work the service, as a typical ASP model includes only the provision of access to functionalities and features provided or ‘served up’ through the use of software, generally via web browser to the customer. BPO is an important part of the outsourcing industry. It is dependent on information technology; hence it is also referred to as information technology enabled services or ITES. Knowledge process outsourcing and legal process outsourcing are some of the subsets of business process outsourcing.