BPO Then and Now: A Look at its History and Growth
Can you imagine the BPO industry without computers and the Internet? It’s a silly thought, right? Where would BPO be without the interconnected networks that span across two or more countries? Outsourcing is about people and businesses that are geographically apart but are brought together by a powerful technology that makes human and data communication possible in real time.
But, would you believe that BPO used to work sans the technology we know today? YES! Before the Internet became a “thing”, sourcing out operations already existed but it in a very different way.
The Old BPO
Business Process Outsourcing (BPO) then was largely associated with the manufacturing industry. The “BP” or business process that was “outsourced” are huge segments of a company’s supply chain, often involving raw materials, production, and distribution of goods and services.
A great example of how BPO worked before is Coca-Cola.
Before Coca-Cola or “Coke” became a global brand, it was ours first. Starting in the late 1880s, Coke made its way into the American market, rising to popularity over time. After roughly three decades, Coke decided to “outsource”. In 1921, Coke teamed up with a local corporation in the Philippines, establishing their first international bottler in the process.
By “outsourcing” their manufacturing operations in the Philippines, Coke did not only save costs but it has also secured a strong presence in the Asia Pacific region.
Now, fast forward to the late 1990s upto the early 2000s. The Internet may not be as good as it is today, but it has allowed the BPO we know to take shape and form. Still centered around cost effectiveness, more and more companies are entrusting their non-core business functions to outsourcing partners in countries like India, China and the Philippines. The number of call centers and back office support companies grew. As a result, businesses gained flexibility, allowing their main office staff to focus on vital core processes.
Business Process Outsourcing in the Present
Today, the BPO industry has definitely gained solid traction. Some even go as far as saying it has undergone a revolution. Over the years, the BPO industry has proven it has more to offer than being just an economic strategy.
For instance, outsourcing is no longer limited to back office and support jobs such as contact centers. With the right systems and the right people, having offshore teams with high level of expertise and specialization is possible. Therefore, companies can outsource even their core business functions.
And it’s already happening now.
KPO, which stands for Knowledge Process Outsourcing, is a subset of BPO that refers to outsourcing integral business functions and working with offshore teams that have an advanced degree of analytical and technical skills.
The industry has grown exponentially since the 1990s. It has opened doors all over the world, benefiting not only the companies that outsource but also the people who openly embraced the opportunity to work with foreign businesses right in their homeland. For both parties, the advantages are undeniable. BPO has gained global acceptance, and without a doubt, it is here to stay.
So, if you haven’t tapped into outsourcing’s potential yet, don’t get left behind. Work with Straightsource and give your business the flexibility it needs. We offer over 44 business services to help you maximize your budget, headcount and resources.