- 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. The most common
examples of BPO are call centres, human resources, accounting and
payroll outsourcing. Business process outsourcing may involve the use of
- BPO includes the
software, the process management, and the people to operate the service,
while a typical ASP model includes only the provision of access to
functionalities and features provided or 'served up' through the use of
software, usually via web browser to the customer.
- To encourage and
attract foreign investments, the government has exempted any income of a
venture capital fund or company from tax, in the event that the income
is derived from investment in a venture capital undertaking, which is
engaged in the business of providing services, or manufacturing products
other than the notified services or articles or things.
- The business
process outsourcing (BPO) market is the single fastest growing area of
the IT services sector. Growing 8% annually, it is estimated at
$400bn today, and is predicted to be worth almost $700bn by 2008.
- India has one of
the largest pool of low-cost English speaking scientific and technical
talent. This makes India one of the obvious choice to outsource to.
Dell, Sun Microsystems, LG, Ford, GE, Oracle all have announced plans to
scale up their operations in India. Others like American Express, IBM
and British Airways are leveraging the cost advantage India has to offer
while setting up call centres. Several foreign airline and banks have
too set up business process operations in India.
- India earned
about $2.3 billion from BPO services last year, according to Gartner. By
2007, the worldwide offshored BPO market is forecast to grow to about
$27 billion, Chohan said.
- BPO markets in
China, Taiwan and Malaysia have a large contract-manufacturing base, but
outsourcing of other business processes has yet to take off. Australia
and New Zealand are the region’s early adopters of BPO, followed by the
rapidly industrializing economies of Korea, Singapore and Hong Kong due
to their high consumption of services.
opportunities for India with the growing need for business services
globally arise from two key drivers i.e. cost management and increasing
complexity of IT environment. The cost advantage of India as a base has
undoubtedly been established through a decode long experience of
developing and maintaining IT infrastructure.