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What Is a BPO Center?

By Peter Hann
Updated May 17, 2024
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Business process outsourcing (BPO) involves a company contracting out a particular aspect of its operations — whether administration, information technology (IT), customer service or another area — to another company. A business process outsourcing center is a site that brings various BPO services together under one roof. Services provided by a BPO center depend on the terms of the contract between the client company and the BPO business. A BPO center often will be offshore in a low-cost area where a skilled workforce can provide the services at a lower cost than could be obtained within the client company. Such a service center would normally ensure that security is high and the risk of theft of the client company’s information is limited.

BPO service centers tend to offer a unique mix of skills, and the client’s choice of BPO center should take this into account. The contract between the BPO center and the client should outline the functions to be performed by the service center and those that are to be retained in-house. It also should include detailed provisions for coordination between the BPO service provider and the client company, as well as a clear explanation of the extent of client supervision for each service outsourced. The details of the contract and the extent of oversight of activities by the client company will likely depend on the client company's BPO strategy.

A call center may be an important part of such a service center. This is the feature of the BPO center that is often most familiar to the public, because it may comprise an important aspect of the client company's customer services function. Call centers are frequently used by telecom companies, utilities, airlines and financial institutions. A call center is likely to make use of the customer service and English language skills of the local workforce but may suffer from the staff's remoteness, both geographically and in attitude. Call centers also may suffer from a negative image related in part to some sales promotion activities.

A BPO center is likely to pay great attention to security issues, because these are often uppermost in the mind of the client company when making a decision to outsource some functions. The BPO center will likely take measures to protect the valuable data stored by the client and the privacy of customer details. These security measures may include restriction of access to certain areas of the buildings, screening of people entering and leaving the location, and password security built into the IT systems.

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