Difference between KPO and BPO

February 25, 2015
KPO Knowledge Process Outsourcing and BPO Business Process Outsourcing are basically the same.  KPO concentrates on outsourcing a company’s information related needs to a third party whereas BPO concentrates on outsourcing those business needs which are not directly related to company's value chain to a third party. KPO requires high technical and analytical capabilities and need experienced professionals to do the process. In BPO a company’s business needs like finance, accounting, customer services etc are outsourced but in KPO information management is outsourced.  Let’s list out some of the basic differences between the two  Technicality: KPO requires more technical skills and advanced knowledge of the specific subjects, but comparatively BPO does not require deep technical knowledge. BPO is just outsourcing a company’s back office or customer service requirements to a vendor, these processes requires less technical knowledge, KPO deals with information delegation so it requires high skill sets and skilled professionals to handle them. Area of Expertise: KPO function on high level processes, it handle works that require high precision, skills and also with processes associated with knowledge like business, market research and development, medical services, biotechnology etc.  BPO functions on low end processes so it only requires less precision and skills and it does not require expert professionals to do the task, BPO concentrates mainly on services like customer services, telemarketing and data conversion services etc. Required Skill Sets: As KPO's deal with knowledge based services they require highly talented and experienced professionals to do the works whereas BPO's require only basic education to handle the tasks. In BPOs only basic computer skills are required but in KPOs analytical as well as technical capabilities are necessary to provide solutions on these information related problems. Pay: Since KPO requires highly talented pool of skills to do the works the pay required to hire these skills are also high. Their wages are way much higher than the wages we need to those work in the BPOs. BPO only requires basic knowledge and skills so those work in BPO only get basic wages. Threats: There are several threats associated with these two; one of the main threats associated with BPO and KPO providers are security issue, outsourced data may get  lost, stolen or mishandled. KPOs has more security issues than BPOs since it is associated with outsourcing lot of knowledge and highly classified information. These information may leak while transfer or during unprotected communication this can even affect the proper working of the company. BPO also has security issues like data leakage or manipulation but they may not cause severe effect on the working of company. Outsourcing these works may lead to problems like data manipulation or mishandling them by employees. Communication Skills: Both KPO and BPO require high command over English language but as KPO require indirect or direct communication with international clients all the time, they require extreme communication skills. BPOs and KPOs have several differences as they require different levels of skill sets and knowledge for their working. But the fundamental reason for outsourcing to these providers are their large pool of talents and their cost effective services.



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