Business Process Outsourcing (BPO): A Guide for Modern Australian Businesses
In today’s competitive landscape, smart businesses are constantly looking for an edge. Business Process Outsourcing (BPO) is the process of hiring an external company to handle specific business activities for you. At Phil Labor, we help you save time, reduce costs, and focus on what you do best.
What is BPO? (And How is it Different from IT Outsourcing?)
It’s best to think of BPO as a key business strategy. While BPO often involves technology, it is distinct from Information Technology (IT) Outsourcing, which is specifically focused on technical activities like managing applications, data centers, or network security.
Early on, BPO consisted of basic administrative tasks like payroll and employee benefits management.
- Financial and Administration (F&A) processes
- Human Resources (HR) functions
- Call center and customer service activities
- Accounting and payroll
These BPO deals frequently involve multi-year contracts that can run into hundreds of millions of dollars. Often, the people performing the work internally for the client firm are transferred and become employees for the service provider. Dominant outsourcing service providers in the BPO fields include US companies IBM, Accenture, and Hewitt Associates. You could also find European and Asian companies Capgemini, Genpact, TCS, Wipro and Infosys using BPOs.
BPO in the Modern World: Offshoring and Beyond
Many BPO efforts involve offshoring—hiring a company based in another country to do the work. India is a popular location for BPO activities, but the Philippines has emerged as the premier destination for Australian businesses due to its unique combination of talent, English proficiency, and cultural alignment.
BPO is also known as Information Technology-Enabled Services (ITES), as most business processes are now “enabled” by some form of technology or automation.
An Evolution of Outsourcing: From BPO to KPO and BTO
The concept of outsourcing continues to evolve with more sophisticated business needs.
- Knowledge Process Outsourcing (KPO): KPO includes activities that require greater skill, knowledge, education, and expertise to handle. For example, whereas an insurance company might outsource data entry of its claims forms as part of a BPO initiative, it may use a KPO service provider to evaluate new applications based on a set of criteria. KPO also encompasses R&D, product development, and legal e-discovery.
- Business Transformation Outsourcing (BTO): BTO refers to the idea of having service providers contribute to the effort of transforming a business into a leaner, more dynamic, agile, and flexible operation.
At Phil Labor, we combine the best of BPO and KPO to provide you with a high-quality, professional, and results-driven team.
Use an introduction to outsourcing session and learn firsthand how we handle the complexities of hiring, management, and compliance so you can focus on transforming your business.