BPO vs KPO

Difference Between BPO vs KPO

BPO vs KPO – These days outsourcing is used by almost all sectors, multinational companies, all industries. It’s basically hiring of a third-party service provider for various services and solutions. There are many services like marketing, operations, human resources, technical support, customer support, etc. They are outsourced to save cost, time, and manpower by companies for these outsourcing KPO and BPO are used.

In this article, we look at the differences between BPO vs KPO.

What is Business Process Outsourcing (BPO)?

BPO stands for Business process outsourcing. It can be defined as the outsourcing of non-primary activities to a third-party service provider for service to decrease the cost of the company and increase the productivity and efficiency of the company. BPO is the outsourcing of mainly processes and functions.

BPO is of three types they are as follows:-

  • On-shore BPO – When the outsourcing of services is done by a company to another company within the same country
  • Nearshore BPO – When the outsourcing of services is done by a company to another company located in a nearby country.
  • Offshore BPO – When the outsourcing of services is done by the company to another company is located overseas.

BPO can handle below activities

  • Human Resources – Training, recruitment, payroll processing.
  • Customer care – Call center, help desk.
  • Technical support.
  • Technical solutions
  • Finance and accounting services.
  • Website services – Website maintenance, updating etc.

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What is Knowledge Process Outsourcing (KPO)?

KPO stands for knowledge process outsourcing. It refers to the outsourcing of highly skilled personnel for transfer or assign of knowledge plus process related to the process to another company. The company hires other outsourcing company which can fulfill the requirement of a company it can be in the same country or overseas main intention behind this to minimize the cost of the company. It performs a task where high skill is required with depth knowledge, expertise, and interpretation power.

KPO can handle below activities –

  • Investment research activities
  • Market research activities
  • Data analytics
  • Business research services
  • Legal process outsourcing

BPO vs KPO Infographics

Here we provide you with the top 10 difference between BPO vs KPO

BPO-vs-KPO-info

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BPO vs KPO – Key Differences

The key differences between BPO vs KPO are as follows –

  • BPO stands for Business process outsourcing whereas KPO stands for Knowledge process outsourcing.
  • BPO can be defined as the outsourcing of non-primary activities to the third-party service provider for service to decrease the cost of the company and increase productivity and efficiency of the company whereas KPO refers to the outsourcing of highly skilled personnel for transfer or assign of knowledge plus process related to process to another company.
  • Services offered by BPO are Human Resources, Customer care, Technical support, Technical solutions,  Finance and accounting services, Website services and services offered by KPO are Investment research activities, Market research activities,  Data analytics, Business research services, Legal process outsourcing.
  • BPO is based on rules whereas KPO is based on judgment.
  • For BPO good communication skills staff is required and for KPO professional qualified staff is required.
  • BPO focus on low-level process whereas KPO focus on the high-level process.
  • In BPO low coordination and collaboration are required whereas in KPO high coordination and collaboration is required.
  • BPO is less complex whereas KPO is more complex.
  • BPO needs process expertise whereas KPO needs knowledge expertise.
  • BPO is volume-driven whereas KPO is insights-driven.
  • BPO relies on cost arbitrage, on the other hand, KPO relies on knowledge arbitrage.
  • In BPO process is pre-defined whereas KPO required application and understanding of business.

BPO vs KPO Head to Head Difference

Let’s now look at the head to head difference between BPO vs KPO

Basis BPOKPO
Full-FormBusiness process outsourcingKnowledge process outsourcing
DefinitionBPO can be defined as the outsourcing of non-primary activities to a third-party service provider for service to decrease the cost of the company and increase the productivity and efficiency of the company.KPO refers to the outsourcing of highly skilled personnel for transfer or assign of knowledge plus process related to the process to another company.
Based onRulesJudgment
Degree of ComplexityBPO is less complex.KPO is highly complex.
RequirementIt needs process expertise.It needs knowledge of expertise.
Driving forceVolume-drivenInsights-driven
Coordination and CollaborationLowHigh
Talent RequiredGood communication skillsProfessional qualification
Focus onLow-level processHigh-level process
ServicesHuman Resources, Customer care, Technical support,  Technical solutions,  Finance and accounting services, Website services Investment research activities, Market research activities,  Data analytics, Business research services, Legal process outsourcing

Conclusion

Outsourcing is in practice across industries. Outsourcing is basically hiring a third-party service provider for various services and solutions. There are many services like marketing, operations, human resources, technical support, customer support, etc. They are outsourced to save cost, time, and manpower by companies for these outsourcing KPO and BPO are used.

BPO refers to the outsourcing of non-primary activities to the third-party service provider for service to decrease the cost of the company and increase productivity and efficiency of the company whereas KPO refers to the outsourcing of high skilled personnel for transfer or assign of knowledge plus process related to process to another company. Services offered by BPO are Human Resources activities, Customer care-related activities, Technical support,  Technical solutions,  Finance and accounting services, Website services and services offered by KPO are Investment research act activities, Market research activities, Data analytics, Business research services, Legal process outsourcing. KPO vs BPO is needed by companies based on need company choose KPOs and BPOs.

KPO vs BPO is work on the B2B environment. The intention of the company of hiring BPO is cost arbitrage and KPO relies on knowledge arbitrage. KPO is an extended version of BPO but now BPO is losing its existence and nowadays these outsourcing companies are providing KPO and BPO services simultaneously to the company.

This has been a guide to the BPO vs KPO. Here we discuss the top differences between BPO vs KPO along with infographics and comparison table. You may also have a look at the following articles –

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