BPO - Business Process Outsourcing which is the outsourcing of a second line business program to maximize profitability by achieving multiple benefits of cost reduction, improved quality of work, reduction in capital investments and strengthen competitiveness. Outside service provider manages it according to a defined set of metrics. These business functions are necessary but not part of the core business of a company once outsourced give the businesses freedom to concentrate on their core competencies.

Even though Business Process Outsourcing (BPO) is proving economically successful business option and despite many companies competing in the marketplace, there is still lack of understanding as to what creates the success.
Businesses are negotiating on more than just low cost option with prospective service providers. Aspects of long term and short term risk management consideration from outsourcing are being looked into. Success of any outsourcing program depends upon considerations of various disciplines and expertise for long term success. The location of outsourcing has no bearing on the success and failure of any business agreement. Service providers have to be capable and competent to win the business and manage it successfully.

Skilled Workforce and Change Management
One of critical aspects of success of BPO depends upon access to skilled labor which requires a service provider company to also have an effective change management capability in place. Change management is ongoing workforce change management process which is required through lifespan of business agreement between two involved business partners. It addresses the business aspects of managing the recruiting, training, or transferring of employees from the business to the service provider and deals with the human issues related to that change.

Process and Operational Technology Expertise
For any BPO engagement workforce cost advantage has usually one time impact while the process and technology expertise offers the service provider the opportunity to improve the process thereby achieving the productivity gain. The continuous process improvement program requires having a well-established successful quality management program in place.

Domain Expertise and Continuous Innovation
Domain expertise and ability to implement it in a specific domain and continuously improving existing processes is most important for a successful BPO service provide Specific domains expertise which is industry or process specific in this context along with strong process and technology expertise significantly improve the performance by the application of best industry practice knowledge.

Operational Stability and Management
Outsourced program is successful when the service provider delivers it in stable and well implemented operational environment and meets the customer requirements.
The process, technology, and domain expertise along with well regimented operational approach delivers results on a consistent planned basis and assures compliance.

Any successful BPO service provider has to have a strong process or technology expertise and domain knowledge. Talented workforce is requirement for a requirement for as successful BPO service provider but it not, by itself, a criterion for it, on the other hand operational knowledge and experience equipped a strong transition management and planned work solution are mandatory to achieve successful results. It further assures that BPO service providers can meet the commitment for successful program utilizing the quality and operational management expertise. The most successful service providers have all of above said expertise as their core competencies and they continue to improve and grow utilizing domain knowledge.