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What does BPO stand for? What does it mean?

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  • jmj answered 9 years ago
Business Process Outsourcing (BPO) is outsourcing of business functions generally performed by white collar and clerical employees to achieve various benefits such as cost savings, better quality and ability to focus on core competence. BPO involves outsourcing processes that are not core to a company, however, are essential for smooth operation of the company. The customer transfers the complete responsibility of these functions to the vendor who guarantees certain service quality standards. Such processes include customer service, payroll processing, inventory management, etc.
The global market size for BPO is estimated to be around USD 382.5 billion in 2004 according to market intelligence firm IDC. The research firm expects robust growth in the BPO industry with more and more companies reaping the benefits of BPO all over the world. The BPO market size is expected to reach USD 641.2 billion by 2009 with a Cumulative Annual Growth Rate (CAGR) of 10.9 percent from 2005 to 2009.
BPO has evolved over the years, beginning with time-sharing data processing in the 1960s; according to technology research and consulting firm ebs. Over these years, like outsourcing, BPO has moved from being transactional (task oriented) to being strategic (process oriented). Table 1 provides the key milestones in the evolution of BPO.

BPO Trends
The BPO industry is a developing sector and is being studied by analysts and researchers all over the world. Analysts tracking BPO have observed the following trends in the industry:

The BPO market worldwide is expanding with new services getting added to the list of business processes that are outsourced and new locations coming up as potential offshore destinations, India being the most preferred destination for offshore BPO.
Cost savings is one of the most important drivers now. Information security, execution capability and financial stability are important considerations while selecting a vendor.
According to IDC, customer care and logistics are mature segments, while procurement and training are emerging markets and are expected to have a growth of more than 10 percent in the next five years.
Gartner has also observed the latest trend of offshore insourcing , in which firms establish their own offshore captive centers. These captive centers are generally shared service centers and allow the firms to retain control over the processes.


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  • RAM answered 9 years ago
    BPO- Business Processing Outsourcing
    good day
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  • Alisa answered 2 months ago
    BPO stands for Business Process Outsourcing.
    Business Process Outsourcing(BPO) is a form of outsourcing which involves contracting operations of specific business processes. BPO company might outsource services like call center, internet marketing, legal services, business consulting, data entry, book keeping and financial services. BPO includes not only calls but it is an organization that receives outsourcing full fledged activity for another organization not limited to only calls. There are two primary types of BPO: back office and front office outsourcing. Typical back office processes that may be outsourced include payroll, billing, logistics and human resources. Some companies offer their services in collections, credit analysis, job recruitment, claims processing at an insurance company are being outsourced to separate companies. Examples of front office outsourcing include technical support, customer service, marketing and advertising.
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  • abhishek s answered 9 years ago
    BPO stands for Business Process outsourcing,
    It is generally used for business transactions when done from a remote locations( abroad) where labour is cheap and done by other organisations, it is done on the contract basis.One organisations outsources its some of the processes to other BPO organisations for desired work. India is today's current favourite for this purpose.


    MBA course i am currently taking in.
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  • usaf.primebeef answered 9 years ago
    Business Process Outsourcing (BPO) is the leveraging of technology or specialist process vendors to provide and manage an organization's critical and/or non-critical enterprise processes and applications. The most common examples of BPO are call centers, human resources, accounting and payroll outsourcing
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  • ms3d_maxy answered 9 years ago
    BPO refers to -business process outsourcing, the increasing trend of relocating entire business functions to either self-owned or third-party service providers, typically in low-cost locations.
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  • Sandy answered 9 years ago
    Business Process Outsourcing - hiring a vendor to take responsibility for a business process.
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  • raunak answered 9 years ago
    business process outsourcing, the best example is the call centre which are working for MNCs overseas
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  • . answered 9 years ago
    Breast Production Organization.
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  • prakunna answered 9 years ago
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  • hellobupesh answered 9 years ago
    Try the links in http://www.bpoindia.co.nr
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  • Krishna answered 9 years ago
    What does BPO stand for? What does it mean?

    BPO stands for Business Process Outsourcing. Major corporations in the US and Europe are outsourcing their back office operations to India to save costs. E.g. employee payroll is maintained in India for their employees worldwide.

    What does ITES stand for? What does it mean?

    ITES stands for IT-enabled services. IT-enabled outsourcing can be defined as,

    Those outsourcing services that use information technology in the processing and delivery of the service. Services are typically delivered through a telecommunications or data network, or other electronic media.

    What are the reasons for outsourcing?

    Reason Savings

    Cost reduction 43%

    Focus 35%

    Access to special enterprise 32%

    Resource related reasons{relieve resource constraints, reduce IT staff and augment IT staff} 51%.

    What exactly does the BPO market comprise of?

    There is a disagreement as to what exactly constitutes BPO. With the rapid expansion of the BPO industry and the extent of its reach, it is becoming increasingly difficult to define what a BPO exactly means. It encompasses a wide variety of activities such as human resource, accounting, financial research, marketing, sales, legal work, logistics and so on. Software services are also regarded as a part of the BPO market by many firms.

    What is BPM?

    BPM stands for Business Process Management, basically this is about outsourcing the business processes.

    Now what is BTO!! ?

    BTO stands for Business Transformation Outsourcing. Accenture defines BTO as a strategic partnership between the customer and the outsourcer with the advantage of sophisticated financing mechanisms. It would involve the firm acquiring strategic stakes in the BPO operations that companies have outsourced. BTO involves sharing risks and gains with an outsource business partner, measuring the performance improvement in dramatic gains in the share price, market position and return on capital.

    What is MBPO?

    MBPO stands for Medical Business Process Outsourcing. Apollo Hospitals is the first major hospital to be getting into this.

    Can medical transcriptions be considered as BPO?


    What are the 4Es?

    Engagement, education, enactment and enforcement framework is expected to ease the concerns of security and data privacy issue.

    What is Procurement BPO?

    Procurement BPO is transfer of management and execution of one of more procurement activities, transfer of the entire procurement sub-segments or transfer of the entire procurement business functions to an external provider. It offers increased productivity, cost reduction and business transformation to the client. It has a market potential of $10 billion by 2006.

    What does BOT mean?

    BOT stands for build, operate and transfer. BOT is not applicable only to BPO. Generally clients who wish to have their captive centre partner with a local company which builds and operates the centre for 2-3 years and then transfers it completely to the client.

    What is HIPAA?

    HIPAA stands for Health Insurance Portability and Accountability Act. The US healthcare industry has been interested in simplifying administrative processes and improving efficiency for several decades. The industry leaders concluded that greater standardization of data and transactions was necessary to improve efficiencies. This conclusion was subsequently memorialized by specific administrative simplification language included in the healthcare legislation called the HIPAA.

    What is DNC [Do Not Call] list?

    US Federal Trade Commission (FTC) Telemarketing Sales Rule bars companies from calling individuals who have registered themselves on DNC list. This hurts call centres that make outbound calls [cold calling]. This rule comes into effect from October 1, 2003. As of Sept 1, 2003 about 48 million individuals have registered on the DNC registry. If a company calls an individual on the DNC list, the fine can be approximately $11,000. Call centres have bought insurance to protect themselves from being fined.

    Visit National Do Not Call Registry for first hand information. Call centres can download the DNC list from this site.

    What does BFSI stand for?

    Banking, Financial Services and Insurance.

    Is there any restriction about women working in call centers at night?

    In Karnataka, the Legislative Assembly passed a bill in August 2002 which provides for the use of services of women employees during night. Section 25 of the Act was modified to accommodate this change. It is likely that all other states have a similar law. But the story seems to be a bit different in Delhi .

    What is BOSS?

    BOSS stands for Burn-Out Stress Syndrome. BOSS syndrome is seen very commonly among young people working in call centres. The symptoms of this syndrome include chronic fatigue, insomnia and complete alteration of 24-hour biological rhythm of the body. Gastrointestinal problems are inevitable for those working at nights as the body is put under chronic stress. A potentially fatal increase in heart rhythm can result in severe chronic gynaecological problems in women and sleep disorders in both men and women. Guidance about physical and mental coordination to meet the demands of a call centre job is necessary.

    Is it true that one needs very low skilled labor for a BPO operation?

    Not true. It really depends upon what is the kind of job you are doing for your client. There are companies in India who are doing the R&D work for their clients. Is that low skilled labor?

    What does captive operation mean?

    The multinational company sets up its own BPO operation instead of outsourcing to a third party. E.g. GE Capital has its operations in Hyderabad and Gurgaon, Dell has an operation in Bangalore .

    What is OTTS?

    OTTS stands for Outsourcing Through Six Sigma

    Are there any capability models for the ITeS industry?

    Information Technology Services Qualification Center (ITsqc) in Carnegie Mellon University has developed the eSourcing Capability Model (eSCMSM) for Service Providers to enable IT-enabled sourcing service providers to appraise and improve their capability to provide consistently high quality sourcing services. The eSCM framework also will enable service providers to establish and manage continually improving relationships with clients.

    What do I need to enter the BPO arena?

    The following list is no different than for any other business.

    Domain or process knowledge - basically you need to know the customer's business. Yup, this is in short supply.

    Customer access

    Market reputation

    Capital base

    Do any associations cater to the BPO segment?

    NASSCOM is the best organization that caters to the BPO segment. They have done a wonderful job in addressing the issues with the government. They have a special group called SIGITES - Special Interest Group for IT Enabled Services. ASSOCHAM too has an initiatve for the BPO sector.

    What does "follow the sun" model mean?

    India is situated 5 hours ahead of UK , 10 hours ahead of New York and 13 hours ahead of Los Angeles . US and UK companies can claim overnight response capability because during their night time, it is day time in India and agents in India can respond to emails during Indian business hours. This is known as follow the sun model.

    Are there any setup guidelines from the govt of India ?

    See guidelines. This is basically to get the DoT [Department of Telecom] clearance to operate a call centre. There is no prescribed application form, but you need to submit a set of documents. From what we have heard this office is very helpful and they don't harass you.

    Can ITES companies share bandwidth?

    As of Oct 22, 2002 the Govt of India has decided that ITES can use the bandwidth on a time-sharing mode. It would not be treated as resale of bandwidth, which was banned in India . The move will allow firms to use the same facility and bandwidth to service Indian and international clients, which is not permitted under the present norms. BPOIndia.org would like to thank Confederation of Indian Industry (CII), which mooted the idea.

    Why is it important to have the call centre in multi-locations?

    BPO clients would not like their work to be disrupted. To ensure continuity it is essential to be multi-locational, at times this could mean in different countries also.

    BPO companies need to constantly evaluate where they can get the best value for their money. Low-skill jobs like data entry could be outsourced to countries where labor is cheaper than in India .

    Few countries have data access legislation that prevents databases and information from crossing geographical boundaries. The best way to solve this problem is to have a BPO centre in that country itself. At times BPO client can take permission from the appropriate authorities and move the database outside the country. For e.g. in the case of EDS [Enhanced Directory Service] the operator needs to access a database which has the information of the residents/businesses of the client country. Usually you are not allowed to ship this database outside that country, however clients have taken special permission to ship this database to countries like Philippines .

    What is IVR?

    IVR stands for Integrated Voice Response. IVR systems are automated systems installed in customer contact/service centers that help automate routine tasks such as account information, product information, schedule etc. IVR systems help automate many transactions that free employees tedious repetitive tasks. Customers can input their query using touch tone phones and these days advanced IVRs support speech recognition.

    What is the bandwidth advantage talk about at Kochi (Kerala)?

    Kochi has some of the cheapest available bandwidth in the country. It has the advantage of being located at the landing points of both satellite and submarine cable links. Both Sea-Me-We 3 and SAFE international submarine cables land at Kochi . Not only is bandwidth abundant, it is cheaper than at other locations. VSNL offers a 2 Mbps Internet leased line for Rs 12.5 lakh at Kochi . A 2 Mbps IPLC link costs Rs 40 lakh here. Nasscom has rated Kochi as one of the top two destinations in India for bandwidth intensive IT-enabled services. VSNL's International Gateway Exchange with 15 Gbps capacity is located next to the Cochin Special Economic Zone. Recently VSNL unveiled the SAT-3/WASC/SAFE submarine cable station in Kochi . With this, Kochi is one of the 16 landing points across the world for the submarine cable. The cable system has an ultimate capacity of 120 Gbps that enables it to convey a total of 5.8 million simultaneous telephone channels. VSNL operates a facility in the zone under the co-location scheme, offering global connectivity support to zone units at low-entry costs. (Source: Express Computer)

    What is the talk about BPO companies being taxed?

    The Indian government wants to examine whether a non-resident company, which has outsourcing deals with a BPO outfit in India , is subject to tax in India . Tax implications for the BPO sector (source Express Computer)

    Taxing BPO clients will increase the cost of transacting in India . This will make India less cost-effective.

    Companies will be discouraged from outsourcing their processes to India , this will slow down the growth rate of the Indian BPO sector.

    Indian BPO sector will lose out vis-à-vis its competitors like Philippines , China , Ireland , Hong Kong , etc, if government adopts tough tax regimes.

    The employment generated by the BPO sector might take a beating and the country will lose out significantly on the income tax charged on individual employees.

    Overseas clients might perceive India as a country where taxation policies are not stable. India needs to project itself as a stable destination.
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