BPO Services: A Profitable Business Model

Business Process outsourcing means delegation of work to another company. Majority of the country at present outsource non-strategic, labour intensive work to different companies across the globe.

BPO work can be divided into two major categories:
1. Back Office: This includes internal business functions such as billing or purchasing.
2. Front Office: This includes customer-related services such as marketing or tech support.

Use of a BPO as opposed to an application service provider (ASP) usually 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 includes only the provision of access to functionality and features provided or 'served up' through the use of software, usually via web browser to the customer.

BPO Companies are categorized as follows:
1. Offshore Companies
2. Onshore Companies
3. Near Shore Companies

Offshore BPO Companies are companies located overseas. Most of the Offshore Companies are located in India, Philippines, China, Pakistan, etc.

Onshore companies based in the same country are called onshore companies. For example: A company based in US outsources technical support to a US based call center.

Near Shore BPO Companies would mean companies which are based very near to the nation. For example: A Company based in Canada servicing to a US based company. Some examples of Near Shore BPO Companies are call centers based in Dominican Republic, Romania, Costa Rico, Mexico, etc.

Majority of BPO companies are located overseas and provide call center services, data entry work, email answering services, telemarketing, etc.

Benefits of Outsourcing Companies:

1. Cost Reduction: The most important factor is cost reduction. Offshore outsourcing companies operate at very low cost. An average Call center in US charges $15- $20 per hour for technical support or customer service, whereas, call centers in India charge $8 - $12 an hour for the same job.

2. 24/7 operations: BPO Companies operate 24/7 and 365 days a year. This is a major advantage over Onshore BPO Companies.

3. Quality of Service: BPO Companies focus on delivering high quality service to the companies they work for. Quality and data security parameters like ISO, BS 7799, 6 Sigma, COPC, lean are studied and implemented to maintain high quality standards.

BPO Companies are one of the fastest growing companies today. In India giants like GE, American Express, IBM, Convergys, Aegis, Amicorp-BPO, Wipro, E4E, 24/7 have around 10000 employees servicing different aspects of the industry.

It would be a wise decision to enter the BPO sector after the great success in recent years. Experts predict that the Outsourcing Companies will rise in near future, opening more avenues for all. One BPO Company is established almost every day in India alone. This is not just the present, it is the future.