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Wear an ID card and walk on the road in Bangalore, the Silicon Valley of India, and you would be immediately associated with an Information Technology (IT) Company or its Business Process Outsourcing unit by the people. Thanks to the IT boom. It generated employment not only for Engineers, but also for under graduates and graduates.
The concept of BPO (Business Process Outsourcing) was very new to India few years back. Now, India is one of the major outsourcing nations in the world processing businesses and accounts for people from every nook and corner of the world. Tom Friedman rightly named his book, World is Flat in which he talks about how these BPOs work.
With India producing tens of thousands of Engineering graduates every year, IT companies and ITES (Information Technology Enabled Services) companies are the beacon of job opportunities for many. The amount of employment they have generated in the country is astounding.
Yet, having come to this bullish job market of India with Journalism major, with lot of apprehension about my career, not wanting to get into BPO or ITES, it was a great surprise when I was introduced to a new business called Knowledge Process Outsourcing, in short, KPO.
Yes, KPO is the new form of outsourcing that’s catching up in India. Though, it sounds quiet similar to BPO with only a word different, its much a further step in outsourcing.
"KPO industry is a step upward of BPO industry. BPOs were into transaction processing and call centers and back office kind of processes. But when it comes to KPOs, we are talking about knowledge processing which helps companies in their decision making process", says Ms. Shoma Bakre, Managing Partner of a leading KPO, Empower Research Knowledge Services Pvt. Ltd., in Bangalore.
When we say KPO is a step ahead of BPO, KPOs deal not only with knowledge process, they are also into legal research, patent research, market research etc.
Business Process Outsourcing deals with the process. As Wikipedia quotes "Business Process Outsourcing (BPO) is the leveraging of technology or specialist process vendors to provide and manage an organization's critical and/or non-critical enterprise processes and applications." This includes call centres, payroll outsourcing, data entry operations etc.
"BPOs and KPOs are businesses which deliver services. But the difference is how the services are delivered", says Mr. Prashanth Menon, Operations Officer in Empower Research Knowledge Services Pvt. Ltd. who has joined KPO industry after gaining considerable experience in the BPO industry.
"All BPOs have a same set of activities done. The only commonality between both is the outsourcing. But KPO is a vague term for the industry. The term doesn't define all the work done", says Mr. Prashanth.
BPOs are preferred by under graduates who can earn lots immediately after their studies which is not otherwise possible in country like India.
"BPOs are jackpots for youngsters who get into a job immediately after their under graduation studies for fat pay. It is a welcome one because except for night shifts, work is not really heavy", says an employee of a leading BPO in the country.
When it comes to pay scale, BPOs definitely ahead of KPOs.
"BPOs do pay lot more than KPOs but when it comes to learning and developing your analytical frame of mind, KPOs are the best", says Ms. Bakre.
But the night shifts and the irregular timing of BPOs are a matter of concern for many. This has also led to high level of attrition say Counsellors.
"Attrition level is high because the pay offered by different companies are inviting and money is a big motivator", reasons Mr. Kumar (Name changed) a Team Leader of the leading BPO.
"Professionals in to BPOs lead very irregular and artificial lives. In this regard, I would say KPOs are better because though the work might be demanding with deadlines to be met, we lead a normal life and regular working hours", says Ms. Bakre.
"Attrition is high in BPOs because of night shifts, family values. Also the growth is faster in BPOs which leads to decrease in the quality of service rendered. This leads to frustration among the team members and they quit the job. But it doesn’t happen with KPOs because we are new into the field and we haven't experimented everything", says Mr. Menon.
Though BPOs are suitable as start-ups for young graduates' careers, not many choose it as a long term career option because of attrition, monotony and also because of the work experience gained in a BPO is useful in another BPO only.
"Work experience in a BPO is very valuable because whatever an employee of Fortune 500 Company or a MNC does overseas is done by a BPO employee here in India. Only the place differs. Hence its as good as working for the company abroad", says Mr. Kumar. "There are project managers who are into this business for the past 15 years", he adds.
"We all think that long term career is not possible in BPOs because we feel outsourcing business might not be with India for long. But, if they want to wind up the business soon, why would big companies invest billions of dollars in the country?" Mr. Menon asks.
But KPOs don't seem to have such short comings many because of the nature service rendered and the continuous process of learning that is inevitable. Employees seem to feel an affinity towards their subjects and hence they stay in the job.
Ms. Bakre says, "I would say it depends on what kind of person one is. Probably, I would find a BPO job monotonous and will be burnt out in two years because of the nature of the job. Also, in call centre the growth is up to a certain level and after that you ask yourself 'what next?'. But in a KPO the growth is immense because of the learning opportunities".
The success of BPOs has led to KPOs and now there are different types of KPOs catching up the market. Talking about the popularity of outsourcing in India, Ms. Bakre says, "KPOs are doing what a traditional consulting firm would do in US charging hundreds of dollars from their clients. Due to the cheap labour, the talent pool and the work force available here, India has become a major outsourcing nation."
The growth of the industry only shows the good quality of work being delivered. "We keep getting bigger clients and they have started trusting us and giving us more business", she says.
"India is leading in outsourcing. But very soon India might have China and other asian countries as its competitor. The basic Tier 1 that is the text support might be shifted to other countries but India will still possess the know how and hence the Tier 2 services will be with India", says Mr. Menon.
The line of difference between both the industries lies not only in the service rendered, but also in the qualifications required to be employed. BPOs who are leading in the country in recruiting youngsters seem to be successful in it.
"BPO can be called an unskilled work. Meaning, employees need to speak good English and have neutral accent and the trainers can take care of that also. But KPOs need expertise in their areas. If we need IT professionals in KPO we also need them to be proficient in English to convey their analysis", Mr. Menon says.
Ms. Bakre says, "A call centre employee would probably need voice training and accent training and thick skin to put up with customers who slam down the phones on them. But knowledge factor is much lesser when compared with KPO".
So, KPOs does seem to be a welcome change and future for many youngsters these days. Slowly, BPOs are also into the processes which KPOs undertake. Does that mean that KPOs will overtake BPOs?
Mr. Kumar says "KPOs can never outplay BPOs because BPOs are still a place for challenges to be met, excitement in work etc".
"It depends on the individuals", Ms. Bakre says. "We are talking about two different businesses. While extroverts would be suitable for BPOs, people who want to improve their domain expertise would prefer KPOs."
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