Different types of Business Process Outsourcing (BPO) services

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Want to know about BPO services and understand how to use them to create the maximum benefits for your business?

Business Process Outsourcing has grown in popularity over the past few decades. From small startups to huge MNCs, every type of business has embraced the power of BPOs!

But what makes BPO services so attractive to companies?

In this article, we’ll cover the different types of BPO services, their benefits and even highlight the top 6 BPO service providers.

Table of Contents

• What is business process outsourcing (BPO)?
• Different types of BPO services
• Common BPO services
• Benefits and risks of BPO
• Top 7 BPO providers

Let’s get started.

What is business process outsourcing (BPO)?

Business process outsourcing is the process of contracting a third party service provider to handle your business operations.

Originally, consumer businesses used to outsource their manufacturing to cut down on costs, but now almost every company includes outsourcing in its business model. In fact, the BPO services market in the United States alone, is valued at $132.9 billion!

So what are all these outsourced services?

BPO categories by service

There are largely two categories of services:

Front-office services:

These are processes that would require your BPO staff to interact with clients and consumers directly. These services include marketing and customer support.

Back-office services:

These deal with internal business functions of the company. This can take the form of administrative tasks like order processing, payment processing and quality assurance.

BPO categories by location

The BPO industry can also be categorized based on vendor location:

Offshore – These Business Process Outsourcing companies are located in a different country from yours. For example – A company in the United States outsourcing their work to a BPO company in the Philippines.

Nearshore – These BPO companies are located in a neighbouring country. For example – A company in the United States outsourcing their work to a Mexican BPO company.

Onshore – These BPO companies are located within the same country. However, they could be situated in another region. For example – A company based in California could outsource their work to a BPO company based in Texas.

Different types of BPO services

Here are some of the most common types of BPO Services.

1. ITES

Information Technology Enabled Services is a type of BPO that handles IT solutions over the internet. ITES usually handles these types of IT services:

• Technical Support
• Service Desk Analyst
• Production Support Analyst

2. KPO

In Knowledge Process Outsourcing, service providers are hired to provide advanced expertise around a particular business process.

KPO services providers handle highly-skilled jobs like:

• Accounting and financial analysis
• Legal processes
• Web Design
• Content Creation

Another two common KPO subsets are – LPO and RPO.

LPO (Legal Process Outsourcing)

LPO comprises a range of high-level legal work.

LPO service providers hire experienced paralegals to work on complex tasks such as:

• Drafting patent applications
• Creating legal agreements
• Performing legal research

RPO (Research Process Outsourcing)

RPO is concerned with research and data analysis processes.

RPO is generally utilized by data-driven companies like marketing agencies, investment firms and pharmaceutical companies.

These service providers work on tasks like:

• Data Analytics
• Investment Research
• Primary and secondary market research

Common BPO services

Here’s a closer look at some of the most common BPO services that you can outsource:

1. Data entry

While it’s one of the simplest administrative tasks, data entry can be tedious and time-consuming.

Instead of using a full-time employee for this task, why not just outsource it?

This way, your in-office employees can focus on more pressing matters instead!

2. Customer support

Customer support is another popular BPO activity.

Think about it.

As your business scales up, you’ll need to deal with tons of new customers.

Instead of hiring and training new in-house customer support executives, why not just outsource to professionals? This way, you save on hiring and training costs while improving customer satisfaction.

Additionally, if you outsource to call centers around the globe, you’ll be able to provide 24×7 customer support!

3. Marketing

Marketing is another popular activity to outsource.

Whether it is SEO (Search Engine Optimization), market research or strategizing, there are a large number of third-party vendors to choose from.

Experienced vendors can help you create effective marketing materials and landing pages to help you convert more customers. As they’re experts in their field they can analyze the landscape better and formulate a winning strategy for your brand!

4. Human resources

Outsourcing HR departments has become increasingly popular with the industry set to reach $43.8 billion by 2024!

External agencies (Recruiting Process Outsourcing vendors) can assist companies with the entire process. From scanning resumes to conducting interviews to shortlisting applicants, these specialized RPOs can help in streamlining the hiring process for your company.

In addition to recruiting, HR BPO vendors can train new hires to help them integrate quicker. You can also hire vendors to work on certain legal tasks such as filing taxes, managing and resolving payroll issues.

5. Finance & accounting

Finance and accounting is another popular BPO service.

Specialized KPEO companies don’t just handle your accounts, they offer services that can add value to your business as well. They can assist your company by drawing up the budget, doing an audit and providing forecasts.

Certain KPO companies can also help your business grow by providing key financial insights. They offer services like global market research, investment management, risk & compliance solutions, and more.

This way, you have a dedicated team for all your finances – ensuring that it gets the attention it deserves!

Benefits and risks of BPO

Outsourcing your business processes has a few advantages and disadvantages. Let’s take a closer look at them:

Benefits

Here are a few key benefits of hiring a third-party vendor.

1. Focus on core competencies

While activities like payroll and data entry are important, they aren’t what your business focuses on.

If you outsource these administrative tasks to BPO services, your company can shift their focus to your core business activities. For example, if you’re a marketing agency, outsourcing your administrative tasks will give you more time and resources to devise marketing strategies for clients!

This can give your company a major competitive advantage, as it can focus on moving up the value chain.

2. Cost savings

This is the main reason why businesses employ BPO services.

Around 59% of companies outsource to control costs.
Why?

When you hire in-house employees, you need to spend a considerable amount on training, equipment, tools, and salaries. You also need to rent an office or a work space.

However, when you outsource a part of your business, you cut down on all these costs.

Additionally, most BPO vendors are located in developing countries that have lower costs of living. This way, you get quality talent for far less!

3. Access to skilled talent

When you outsource your business, you get access to the brightest minds from all over the world! You’re no longer geographically limited when it comes to talent!

Additionally, as you’re only hiring them for specific tasks, they’re going to cost less than hiring a full-time in-office employee.

Also, as they’re only hired for specific services, they’ll be completely focused on their tasks – increasing their productivity!

Risks

While outsourcing is helpful, there are several drawbacks too:

1. Data security risks

When you outsource your work, you entrust a third-party vendor with your data. As this data is shared outside your organization, it’s vulnerable to theft by employees of the outsourced company as well as hackers.

Maintaining security is tricky when the service provider’s data center is in another country, as their privacy laws may differ from yours. In case something goes wrong, it would be difficult to take legal action.

How can you protect your business from these threats?

If you’re dealing with patents, copyrights, or other private information, have a lawyer draft contracts that protect your company and the BPO service. You can even sign NDAs and other agreements to protect your privacy.

2. Communication issues

Communicating with in-house employees is simple, as you can have face-to-face conversations within minutes.

However, providing feedback to third-party employees can be a tedious process.

Here’s what can slow down communication with a BPO service company:

• Language barriers
• Time zone differences
• Different levels of feedback within the agency

These issues can hamper productivity and create problems in your business operations.

How do you bridge the communication gap?

Consider creating training manuals that address all the issues your vendors may face. You can also use virtual communication systems like Slack and Zoom to communicate more efficiently.

3. Monitoring issues

Another issue with outsourcing is that it’s hard to monitor the performance of your BPO staff.

Think about it.

Your BPO provider could be thousands of miles away.

How will you verify:

• If they’re working during work hours
• If they’re accessing unproductive websites at work
• If your projects actually took that long to complete

So how do you monitor their performance?

Just use powerful performance monitoring tools like Time Doctor!

What’s Time Doctor?

Time Doctor is a powerful performance tracking software. It tracks the time your BPO vendor spends on different projects to boost their productivity.

Here’s what TimeDoctor can help you do:

• Monitor what your BPO staff is working on in real time.
• Track the time spent on calls and tasks
• Identify what tasks are taking too long
• Bill your team for tasks completed with accurate work timings

So how does it work?

1. Your BPO service provider installs TimeDoctor on their employees’ devices.

2. The employees track the time they spend on tasks they’re currently working on.

3. You are able to track their internet usage when the timer is on. This way, you can ensure that your BPO staff is focused during work hours.

4. The time tracker automatically stops if employees are inactive for more than 3 minutes. This guards against them marking idle time as hours worked.

5. If the employee accesses an unproductive site (social media, e-commerce) during work hours, they receive a pop-up prompt to keep them focused on the task.

6. You get access to detailed reports over each BPO staff member’s productivity. You can also view a Projects Report that compiles the total time each project took to complete. Use this report to verify how long your projects took.

7. Use TimeDoctor’s built-in payroll features to accurately pay your BPO staff for hours worked.

Want to learn how to manage an outsourced team effectively? Click here to read the complete guide to outsourcing.

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Top 7 BPO providers

There is no shortage of BPO service providers across the globe. Here are 7 of the biggest BPO companies that offer top-notch services.

1. Triniter

Triniter is the most popular BPO companies based in the US. Their employees are known for their hard work and going extra mile to help their clients’ customers. They even offer 200% money back guarantee if you are not satisfied with their services.

Their services include:

• Customer support service
• Account setup services
• Inbound support service
• Outbound center
• Telemarketing
• Live chat support
• Order management services
• Back-office support
• Technical support
• Debt collection
• Email support

Number of employees:

Triniter has around 1000+ employees

Major clients:

Fortune 500 companies

2. Accenture

Accenture is one of the world’s biggest companies for IT solutions. Based in Dublin, it offers outsourcing services in digital technology, consulting and other business operations.

Some of these include:

• Digital Marketing
• Supply chain management.
• Account & Financial services
• Healthcare/Insurance

Number of employees:

Accenture has around 774,000+ spread across more than 120 countries.

Major clients:

Microsoft, Dell & Siemens.

3. Invensis

Invensis is an IT BPO service provider which specializes in software development. Based in Bangalore, India, it offers back-office services and call center services to SMEs.

These include:

• E-commerce support
• Software development
• Finance and accounting
• Data entry and management

Number of employees:

Invesis has around 5000+ employees across India

Major clients:

CBS Interactive, Sprint & KonnecTV.

4. IBM

IBM is a MNC based in the United States.

It provides key process management services such as:

• Predictive asset optimization
• Third-party risk management
• Real estate management
• Consulting and financial services

Number of employees:

IBM has around 350000+ employees across 160+ countries.

Major clients:

Amazon, PayPal, HP and Citibank.

5. Peak Support

Peak Support provides exceptional customer service outsourcing to high-growth companies. They hire the best agents in the business and are relentlessly dedicated to helping their clients succeed.

With Peak Support as your solutions provider, you can focus on building your business, while your customers get the exceptional service they deserve.

Their wide array of services include:

• Customer Support
• Technical Support
• Sales Operations
• Back Office Tasks

Number of employees:

Their global delivery model enables them to provide service from the Philippines and the U.S. with over 1,350 employees.

6. Genpact

Genpact is a global services company based in the United States that offers AI based solutions.

Its business processing management services include:

• User Interface/User Experience services
• Insurance Claims
• Real estate Claims
• Credit Risk Management

Number of employees:

Genpact has around 77000+ employees across 30+ countries.

Major clients:

MGM Resorts, Ciox Health, and Mondelēz

7. WNS Global Services

WNS is a popular provider of legal services and business analytics.

Based in Mumbai, it offers business solutions such as:

• Finance and Accounting
• Legal Services
• Human Resources
• Customer Interaction Services

Number of employees:

WNS has around 60000+ employees in 64 delivery centers across the world.

Major clients:

Air Canada, British Airways, Virgin Atlantic Airways

Conclusion

BPO services are an easy way for your company to streamline their work processes and get more work done for less!

While there are a few risks associated with outsourcing, they can easily be addressed with strict procedures and advanced monitoring solutions.

Go through the list of BPO providers we listed here and find one that suits your needs to get started immediately!

Have any other questions about BPO services? Let us know in the comments below.

Frequently Asked Questions (FAQs) 

1. What are the benefits of outsourcing IT services?

Outsourcing IT services allows businesses to focus on their core activities while gaining access to expert technology solutions. It helps in reducing operational costs, improving efficiency, and ensuring access to the latest technology without the need for significant investments in in-house infrastructure or staff training.

2. How do BPO services reduce costs?

BPO services reduce costs by allowing businesses to outsource non-core functions to specialized vendors, often in regions with lower labor costs. This eliminates the need for hiring full-time employees, reduces overhead expenses such as office space, and minimizes the investment required for technology and training. Additionally, outsourcing increases efficiency by leveraging the expertise and scalable resources of BPO providers.

3. What is the difference between KPO and BPO?

The primary difference between KPO (Knowledge Process Outsourcing) and BPO (Business Process Outsourcing) lies in the type of services outsourced. BPO typically involves outsourcing routine, process-oriented tasks such as customer support or data entry, whereas KPO focuses on outsourcing more specialized and knowledge-intensive tasks like financial analysis, legal research, or market research that require expertise and advanced problem-solving skills.

4. What are the types of BPO services?

There are several types of BPO services, broadly categorized into front-office services (customer-facing functions like customer support and marketing) and back-office services (internal functions like data entry, payroll, and human resources). BPO services can also be classified based on location: offshore, nearshore, and onshore.

5. What industries use BPO services the most?

BPO services are commonly used in industries such as finance, healthcare, telecommunications, IT, retail, and manufacturing. These industries often outsource tasks like customer support, accounting, IT management, and human resources to improve efficiency and reduce costs.

6. Is outsourcing customer support to a BPO effective?

Yes, outsourcing customer support to a BPO provider is highly effective, especially for businesses experiencing rapid growth. It allows companies to offer 24/7 customer support without the need to hire and train large teams in-house, ensuring faster response times and higher customer satisfaction.

7. What are the risks of outsourcing business processes?

While outsourcing offers many benefits, it also comes with risks such as data security concerns, communication issues due to time zones or language barriers, and challenges in monitoring outsourced teams’ performance. However, these risks can be mitigated by choosing a reliable BPO provider and implementing strong security protocols and communication tools.

Have any other questions about BPO services? Let us know in the comments below.