Business process outsourcing (BPO)

Business process outsourcing (BPO) contains the transmission of processes along with the associated operational activities and responsibilities, to a third party with at least a guaranteed equal service level and where the client contains a firm grip over the (activities of the) vendor for mutual long term success. BPO is positively related to the search for more efficient organizational designs: cost reduction, productivity growth and innovative capabilities. Hence, a source for strategic advantage.

Traditionally, BPO is undertaken by manufacturing firms. For instance Coca Cola, where almost the entire supply chain is outsourced and the company is essentially becoming a marketing organization.^[1] However, BPO is nowadays rapidly conquering the service oriented firms as well. A well-known example is provided by the Bank of America, who outsourced their entire HR function to Exult, one of the leading Human Resources BPO vendors.^[2]

BPO is often divided into two categories: back office outsourcing, which includes internal business functions such as billing or purchasing, and front office outsourcing, which includes customer-related services such as marketing or tech support. The endless opportunities IT provides, stimulates (cross-border) BPO activities. BPO that is contracted outside a company's own country is sometimes called offshore outsourcing. BPO that is contracted to a company's neighboring country is sometimes called nearshore outsourcing.

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 software, the process management, and the people to operate the service, while a typical ASP model includes only the provision of access to functionalities and features provided or 'served up' through the use of software, usually via web browser to the customer. BPO is a part of the outsourcing industry. It is dependent on information technology, hence it is also referred to as information technology enabled services or ITES. Knowledge process outsourcing and legal process outsourcing are some of the subsets of business process outsourcing.

Callcenter

A call center is an office where a company's inbound calls are received, or outbound calls are made. Call centers are increasingly popular in today's society, where many companized have centralized customer service and support functions. Call centers employ many staff in customer service, sales and support functions.

Call centers are often large offices staffed with representatives who either make or receive phone calls. Depending on the size of the call center, a single office could have anywhere from a few dozen to hundreds of telephone staff. Depending on the needs of the company, call centers can make either incoming or outgoing calls. Some call centers focus on answering inbound calls, such as a bank that gives out a toll-free number for customers needing assistance. In that case, call center representatives can give account balances and take loan applications over the phone. Other call centers focus on outbound calls, such as a survey company. In that case, survey representatives make outbound calls to ask people to answer survey questions over the phone.

Call centers provide a number of advantages to companies. By centralizing telephone-based service and support in one location, companies can easily adjust staffing to match call volume. Call centers can be located almost anywhere, allowing companies to take advantage of time zones and cheaper labor rates in different states and countries. Call centers also centralize the technology needs of companies, allowing major telecommunications setups to be installed in a small handful of call centers instead of a number of smaller offices, making upgrades and training easier to complete.

Many call centers use a number of different technologies to help improve performance and customer experience. Inbound call centers often use automatic call distribution, in which incoming calls are assigned to representatives on the order they are received. Other call centers utilize call monitoring, in which customer calls are randomly monitored by quality assurance staff to ensure that phone representatives meet customer needs. Call center technology evolves constantly, helping call center staff assist customers more efficiently and effectively.

Call centers have been increasingly popular as outsourcing increases. With outsourcing, companies contract out some functions to other companies. As it can be expensive to maintain call center equipment and staff, some companies choose to outsource their telephone functions to an external call center. In this case, external call center staff can be trained to answer phone calls from a number of different companies.