BPO, KPO, and Call Centre—Petals of the same flower

What is it?

The Phenomenon of ‘call-centre’ or a centralized telephonic one-stop pit is fairly recent. Back in the 1960s, an English press company called the Birmingham Press and Mail is credited with the origin of this modern-day necessity. It had private exchanges that included several workstations to handle its customer contacts. Nowadays, these exchanges are called ‘Private Branch exchanges’, that can automatically route, distribute calls with interactive voice response where the caller can select options such as, which language he is most comfortable, which department he wants to talk to etc.

The structural orientation

A handful of countries dominate this modern day quintessential service sector. Among them are the United Kingdom, United States of America, India and the Philippines. Call centres in India are on a rapid rise. This is true for both the domestic as well as the international scenario. There are generally two types of distinction—inbound and outbound call centre services. The inbound calls are made by customers and can be for a spectrum of reasons such as for query, to report any damage or malfunction of a product or for support. The outbound calls are generally agents calling for sale or for promotion(telemarketing) of a product or service. Recently a ‘blended’ process, a hybrid of the two processes is gaining frequent momentum, typically integrating the elements of both the campaigns where agents are trained to support the overflow of any of the two processes. A call centre in India or in any of the above-mentioned countries has a multi-tiered structure with each tier associated with an increasing degree of complexity. A call can be escalated to another tier depending on the action it requires as per the Service Level Agreement of the company.


The outsourcing of call-centre facilities from a more developed country to a developing country is not a new idea. The outsourced call centres in India and Philippines, also referred to as BPOs are a good example. The full form of the acronym BPO stands for business process outsourcing. The outsourcing industry in India usually supports the domestic companies as well as the international MNCs. The BPO industry of the country contributes to roughly 1% of the nation’s GDP.


KPO stands for knowledge process outsourcing. It is an offshoot of BPO specializing in a particular niche in the industry where the core business is related to information which, in turn, is a part of the value-chain. It requires specialized knowledge and expertise in a particular field. It typically includes ‘non-voice’ back-end functions such as Intellectual Property research, Research and development in the Health sector, legal and financial consultancy and services. The Philippines is a growing market similar to India in this sector. Much like the normal call centres in India, this type of work is also in high demand in India.


Obviously, the benefits associated with a call centre par exceeds the risk factor, or else it would be impossible for the call-centres in India to grow at such a rapid pace.

  • Outsourcing keeps away the trouble of hiring and maintaining the over-head cost along with the infrastructure and technology associated with a call centre.
  • BPO companies have good experience in their field of interaction and interpretation with the consumer. Hence they can do the required job at a lesser turn-around time.
  • Flexible services are provided by the BPOs to adapt to the growth dynamics of an ever-changing market and an increased competition.


  • There is an increased risk of violation of data privacy related to the customer’s personal information, accounts related or human resource related issues.
  • Though cost-effective, the buyer should go through all the hidden cost related to the process of hiring a particular BPO.

The growing global demand for outsourcing has been so far so good for the call centre sector in India. It employs more than two million people in India. It had been a go-to job destination for the recent graduates in the country. Its contribution to the country, both financially and in reputation has been immense and continue to do well despite adverse forces.

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