The full form of BPO is Business Processing Output. It can be defined as a contract of a company with a third party or an outside service provider to engage in its business processes viz a viz operations and responsibilities. It is a cost-effective and cost-cutting strategy undertaken by various companies to do its peripheral or supplementary tasks.
BPO is a system in which a company chooses to hire another specialised service provider who can manage its non-essential activities as the BPO company offers specialized assistance. By outsourcing, the company is able to focus on its core functions.
It is an effective way to minimise a company’s costs in running its non-core activities. Outsourcing significantly reduces the overhead expenses of the company, offers outside expertise, increases revenue, etc.
BPO first started in the manufacturing industry and has now acquired substantial importance in other businesses as well by providing services related to marketing, customer care service, human resources, etc.
Full-Form BPO Example
An example can better define how BPO works. Payroll is one of the jobs that is regularly managed with BPO. It is also a very common and essential task carried out by every business.
It is easier and simpler for the business to outsource the service to a company specializing in handling payroll than to manage an entire payroll department in-house.
Suppose, a company manufactures toys. It can save valuable production time, resources and money when it utilizes another company’s services for payroll responsibilities. This can be advantageous to the company as focus and stress can be directed towards its core and essential activities.
BPO Full Form and its Types
BPO is divided into three types according to their areas of work.
Onshore Outsourcing
Onshore outsourcing is a process in which a company outsources its operations to another company located in the same country. It is also known as domestic outsourcing.
Offshore Outsourcing
Offshore outsourcing is a process in which a company outsources its operations to another company located in a different country. Additional info Also Check WiFi Full Form
Nearshore Outsourcing
Nearshore Outsourcing is a process in which a company outsources its operations to another company situated in neighbouring countries.
Advantages of BPO
Now you know BPO’s full form is Business Processing Output, let’s discuss the various benefits that BPO offers to the company.
Minimised Expenses
One of the primary benefits of outsourcing to another service provider is that it effectively reduces the cost of training, employing in house labour along with the cost of additional office space required for the particular set-up.
Greater Efficiency
BPO companies have expertise in their work areas and execute their functions with the highest level of proficiency. They maintain the use of best industry practices and utilize the latest technology. As a result, greater efficiency and cutting edge innovations are generated for the clients.
Focus on core functions
Many companies, generally start-ups, face difficulty in handling their non-core business activities. Outsourcing the ancillary activities permits the company to focus on its essential tasks rather than devoting time to its non-core activities. For example, when a business outsources its telemarketing services to another telemarketing company, it can invest greater time and resources towards its competitive advantages and overall growth and success.
Global Expansion
In case a company decides to step into an overseas market, various activities like local market knowledge, serving consumers in several languages 24/7 or fluency in a foreign language can be designated a BPO company. This eliminates the burden on the local company, thereby increasing efficiency and a speedy expansion.
BPO In India
Multinational companies all over the world outsource their services to different countries.
BPO companies in India are major players in acquiring outsourcing from these companies. In India, BPO is a thriving segment to work and more than 5 million people are employed in the BPO industry.
BPO companies provide ample job opportunities to many youngsters who wish to start their careers early after their education. Many multinational companies from Australia, China, Ireland and the Philippines choose to give out their services to BPO companies in India, owing to the fact that India offers cheap labour costs and a huge pool of talented, skilled English speaking professionals. Additional Info Also Check CPU Full Form
Skills Required for BPO Jobs
Some basic skill set is required to get a job in the BPO sector, which is given below-
- Proficient communication skills- written and spoken
- Basic computer skills
- Good listening skills and patience
- Ability to work and perform in any shift