CHAPTER 11 - OUTSOURCING BUSINESS STUDIES NIOS X BPO - Meaning and Importance KPO - Meaning and Importance DIFFERENCE BETWEEN KPO AND BPO

1. OUTSOURCING
CHAPTER11
BUSINESS STUDIES - NIOS X

2. OUTSOURCING
Outsourcing is a business practice in which a
company hires a third-party to perform tasks,
handle operations or provide services for the
company.

3. BPO refers to the outsourcing of
non-primary activities of the
organization to an external
organization to minimize cost and
increase efficiency.
BUSINESSPROCESSOUTSOURCING

4. BUSINESSPROCESSOUTSOURCING-ADVANTAGES
Achievecostreductions Keyinoncompany’smainbusiness
This is made possible through process
improvements, reengineering, and use of
technologies that reduce and bring
administrative and other costs under
control.
With the day-to-day back office operations
taken care of, the management is free to
devote more time to building the company’s
core businesses
Obtainoutsideexpertise Meetchangingcustomerdemands
Rather than recruiting and training
personnel, BPO ensures that domain
experts from another company provide
the needed guidance and skills.
Many BPO vendors provide the management
with flexible and scalable services to meet
the customers’ changing requirements, and to
support company acquisitions, consolidations,
and joint ventures.
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5. KNOWLEDGEPROCESSOUTSOURCING
Knowledge process outsourcing
(KPO) is the outsourcing of core,
information-related business
activities. KPO involves contracting
out work to individuals that
typically have advanced degrees
and expertise in a specialized area.

6. KNOWLEDGEPROCESSOUTSOURCING-ADVANTAGES
AccelerateReengineeringBenefits AccesstoTopClassCapabilities
By outsourcing a non-core function to a
competent provider, the organization can
realize the benefits of reengineering as an
outsourcing benefit.
Good and competent providers make extensive
investments in technology, people, and
methodologies. They acquire expertise by
working with many clients facing similar
challenges.
Optimaluseofresources Focusonmainbusiness
Outsourcing allows an organization to redirect
its resources, mostly human resources, from
non core activities toward activities which
serve the core need of customer.
Outsourcing allows a company to focus on
its core business by having operational non
core functions assumed by an outside expert.
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7. KNOWLEDGEPROCESSOUTSOURCING-ADVANTAGES
MinimumRisk Costreduction
Outsourcing providers make investments on
behalf of many clients, not just one and
shared investment spreads risk, and
significantly reduces the risk born by a single
company.
The outsourcing can help a company to
reduce its costs as an outside provider’s
lower cost structure, normally as a result
of a greater economy of scale or other
advantage based on specialization,
reduces a company’s operating costs and
increases its competitive advantage.
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8. DISTINGUISHBETWEENKPO &BPO
KPO BPO
KPO means Knowledge Process Outsourcing. BPO means Business Process Outsourcing.
KPO is another kind of outsourcing whereby,
functions related to knowledge and information are
outsourced to third party service providers.
BPO refers to the outsourcing of non-primary
activities of the organization to an external
organization to minimize cost and increase
efficiency.
Salary of KPO employee is much higher than
offered to the BPO
Salary is less while compared to KPO employees
Requires highly knowledgeable employees Requires less skilled employees
High complex and required Knowledge Expertise Less complex and required Process Expertise

9. THANKS!