It is being claimed that KPO is one step extension of Business Processing Outsourcing (BPO). It is not a simply 'B' replaced by a 'K'. In fact, Knowledge process can be defined as high added value processes chain where the achievement of objectives is highly dependent on the skills, domain knowledge and experience of the people carrying out the activity. And when this activity gets outsourced a new business activity emerges, which is generally known as Knowledge Process Outsourcing.

Knowledge Processing Outsourcing (popularly known as a KPO), calls for the application of specialized domain pertinent knowledge of a high level. The KPO typically involves a component of Business Processing Outsourcing (BPO), Research Process Outsourcing (RPO) and Analysis Process Outsourcing (APO). KPO business entities provide typical domain-based processes, advanced analytical skills and business expertise, rather than just process expertise. While KPO derives its strength from the depth of knowledge, experience and judgment factor; BPO in contrast is more about size, volume and efficiency.

The future of KPO has a high potential as it is not restricted to only Information Technology (IT) or Information Technology Enabled Services (ITES) sectors and includes other sectors like Legal Processes, Intellectual Property and Patent related services, Business Research and Analytics, Legal Research, Clinical Research, Publishing, Market Research (Market research KPO).

Scope and Future of KPO

Also, of course, the talent is much more affordable. "Law firms in the US charge an average of $400-450 per hour, and we do the same work for $75 to $100 an hour". In the Indian context, KPO salaries could be 25-50 per cent higher than those offered to the same domain experts such as Engineer, Doctor, CA, Lawyer, Architect, Bio technologist, Economist, Statistician and MBAs, it said. In its annual publication Strategic Review 2005, Nasscom has said the high-end activity of the BPO industry-the KPO or knowledge process outsourcing could be worth $15.5 billion by 2010.

Billing rates for KPO are higher at $30-45 per hour compared to just $10-14 in the BPO business. However, the paper also warns of several challenges like higher quality standards, greater investments and inadequate talent. The study estimates that while the compounded growth rate of BPO till 2010 would be just 26% KPO is expected to be grow at almost 46%.

Why KPO?

If we look into any financial newspaper, magazine or any literature giving knowledge about the outsourcing business in India, what is found to be most referred word is KPO meaning thereby knowledge process outsourcing. Many new business concerns are coming day by day in Knowledge Processing Outsourcing Industry and KPO is emerging as a new sector that promises to provide long-term jobs for intellectual, analytical and knowledgeable people with pay scales much higher than the BPO sector. The following are the few areas which are being associated with the KPO sector.

• Research & Development
• Financial Consultancy and Services
• Business and Technical Analysis
• Learning Solutions
• Animation & Design
• Business & Market Research
• Medical Services
• Writing & Content Development
• Legal Services
• Intellectual Property (IP) Research
• Data Analytics

Why invest time and money in knowledge process outsourcing?

The basic fundamentals of outsourcing apply equally to knowledge based services as well. A shortage of skilled professionals and availability thereof at higher costs increase the cost of maintaining such services in the host country whereas the same job can be got done with similar precision and quality and at much lesser costs abroad. The major KPO benefits which can be derived are described below.

Benefits of KPO

Standardized technical education is widely available to all in the developing countries especially in India. This skilled and trained manpower is accessible at very low cost as well. It, therefore, is always a wise decision and makes sense to utilize such services. Outsourcing of activities to KPO companies can provide the following benefits:

• Valuable cost savings that can be utilized elsewhere.
• Trained professionals at work.
• Standard operational efficiency.
• Increase in profits.
• Savings in time and management energy for maintaining in house services.
• Option to recruit a larger work force without raising costs.

What KPO can deliver to you?

Any company involved as service provider in the KPO industry works in close coordination and association with the client and provides services that are predefined in terms of quality and standard of work. While working with a KPO firm, the outsourcing company can expect to get the following:

• Good quality work.
• Lower costs.
• On time delivery of services.
• Uninterrupted services.
• Adaptability to changes in required quality.