What is BPO?

Business Process Outsourcing(BPO) is an agency that is hired to perform specific tasks. Genpact is one of the biggest outsourcing agencies. For Example- a company hires a BPO Agency to support customer service. Some common services that BPO offers are-

  1. Customer support service
  2. Advertising service
  3. Financial service
  4. Accounting service
  5. Supply chain Management service

This industry is growing in a tremendous way. Over 1.1 million people worked in the Indian BPO industry in 2017. The industry will be worth an estimated $52 billion globally by 2023. Isn’t it amazing how faster this BPO industry is growing?


Let’s dive into some key benefits of BPO-

  • Concentrate on Core Areas: It is difficult for large organizations to maintain a balance between all departments. Difficult situations come across where it is tough to maintain coordination. However, delegation of some responsibility helps an organization to focus on core business activities and helps them in better decision making.
  • Cost Effective: It is the best way of cost cutting and saving. Money can be saved for future projects. Companies can invest that money in capital expenditure or long term projects. BPO service hires talented personnel at low wages, which is quite affordable for MNCs.
  • Reduce Burden from employees: Overburden of duties makes employees lethargic. Therefore, Human resources can’t be fully utilized. This leads to inefficiency and low productivity. So, delegating some responsibility helps employees to work freely and efficiently. This will ultimately fulfill organizational objectives.
  • Increase Productivity: business process outsourcing saves time and gives the opportunity to explore different channels to generate revenue. If work is given to a person who is skilled in that particular area, then it ultimately increases productivity.
  • Speed: Some business activities are time-bound. Therefore, Immediate action is required to perform such activity. customer servicing should be speedy and responsive. BPO responds timely and provides solutions faster. So, that client may Concentrate on core activities. \
  • 24/7 Smooth Functioning: BPO works all day to assist big companies to work smoothly. Employees have lots of industry experience and trained personnel who give successful results.


Besides having fruitful advantages, there are some drawbacks-

  • Communication Errors: Hamper in communication occurs between the BPO and company due to time differences, misinterpretation, language etc. Language can be the issue when the BPO services are located offshore. Also, delay in communication is one of a kind.
  • Security Issues: sometimes sharing technological information may be riskier. There might be a possibility of piracy and data theft. It is utmost important to verify the contract related to data security. Companies must be careful before sharing any data or information.
  • Loss of Control:Somehow a company loses the authority/ power over tasks. Continuous monitoring is difficult for most companies and if a company has lack of trust, then it is a huge issue. The company didn’t have time to instruct them or ask them about the work process.
  • Hidden Cost: Some big outsourcing companies charge huge money from small business organizations because these companies didn’t have much understanding about the contractual obligations. They charge unexpectedly from the client companies without showing the nature of that cost.
  • Requires Planning: It is not the matter of a second, brief planning is required before selecting the outsourcing agency. Various alternatives should be considered before selecting the best. Continuous follow up is an essential part after selecting. It is a time taking process to collect data and do research on different BPO agencies.
  • Work Life Balance: BPO serves 24/7 all days. Personal life gets disturbed when working hours are too long. It is quite difficult to maintain work life balance. Moreover, Using computer and headphones constantly for long hours, cause eye and ear diseases. Night shift reduces the minimum sleeping hours.Health of a person who is working in a BPO agency also gets into trouble.