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Knowledge Process Outsourcing Time To Think Beyond Conventional BPO Model


Knowledge process outsourcing (KPO) is a new wave in the global outsourcing arena, which is tapping on the potential of business process outsourcing (BPO) and information technology outsourcing models.

Organizations that view outsourcing industry as merely a way to offload their non-core tasks to gain from operational and cost benefits are missing out the key advantages achieved from closely working with the service providers. 

This blog throws light on how KPO is different from the traditional outbound & inbound call center services as well as how knowledge process outsourcing is helping businesses to streamline their operations:

By leveraging KPO services from a reliable vendor, a company is able to contract out its knowledge intensive functions and tasks. India is considered as a dominating player in this market, with nearly 70% of the total market share across the globe. Various services offered by the KPO vendors in the country include data analytics, content management, market research, pharma data processing services, and legal services. 

According to a research conducted by a leading market research firm, Evalueserve, KPO industry worldwide is forecasted to rise at a growth rate of 24% per annum and reach nearly $17 billion by the end of the year 2014. The major factors that have compelled organizations to switch from the traditional call center services to knowledge-intensive sourcing models are:

1. Boost Reengineering Benefits

KPOs implements critical measures of performance, such as quality, speed cost and service, which helps enterprises to improve their efficiency. As a result, some non-core functions are taking a back seat, which are increasing the efficiency of the critical systems. That is the reason why businesses are capitalizing on the expertise of KPO firms, so that the actual benefits of reengineering are obtained. 

2. Obtain Top-class Capabilities

Some of the competent service providers are making substantial investments in the technology as well as new methodologies. This expertise is acquired by their clients to gain a competitive advantage over their counterparts. That is why they avoid the expenses related to technology and training costs.

3. Diminish Operating Costs

Business organizations incur substantial expenses due to research, development and deployment. These are automatically relayed to the customers. Thus, outsourcing reduces costs, which are in sync with a provider's lower cost structure. This results in greater economies of scale as well as some other advantages that are based on certain specializations for reducing operating costs. This further gives enterprises an economical advantage.

4. Optimal Allocation of Internal Resources 

Another reason that compels organizations to outsource their knowledge-based tasks to KPO units is that they do not have a comprehensive access to the necessary resources within their company. Hence, outsourcing becomes a viable alternative. Firms expanding their business to new geographical areas or implementing new technology, or doing spin-offs mainly consider the outsourcing advantages from the very beginning.

Hence, by availing KPO services companies can not only improve their efficiency and achieve cost advantage, but also help the in leveraging the vast knowledge base of high-end skilled manpower. This, in turn, help enterprises to appropriately perform due diligence, identify and address business risks and provide practical and real protection & enforcement mechanisms.

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