Information technology-enabled services (ITES) business process outsourcing (BPO) is an outsourcing model that uses information technology (IT), typically over the Internet, in the delivery of the outsourced process. This type of outsourcing has all of the same features as ordinary BPO with the inclusion of IT as the service delivery mechanism. ITES BPO has emerged as a viable category of outsourcing as the Internet has increased in ubiquity.
Companies outsource business operations to enable specialists to handle processes that are not typically considered part of the core of the business. Examples of business processes that are often outsourced include human resources management, accounting, payroll, data entry, and certain types of customer service functions. Assigning these tasks to third party specialists enables the company to reallocate resources to the design, production, and delivery of its products, rather than to ancillary business processes. In this way, the company expects to achieves cost savings and operational efficiency.
ITES BPO is a type of outsourcing that relies on technology to deliver the requested service. The service is delivered electronically, typically over the Internet, but can use any sort of telecommunications or data network instead. An example of ITES BPO that is not Internet-based is an outsourced IT helpdesk. Companies use an internal IT helpdesk to troubleshoot their own network. If this function is outsourced, the service provider manages service requests by phone or email, logs into the company’s network, uses software to remotely view and control an employee’s terminal, and solves problems through these and other electronic means.
Internet-based ITES BPO projects have become the most popular application of this type of outsourcing. The Internet enables worldwide connectivity that is always on with the inherent redundancies of a network that is maintained by numerous, unrelated sources. More importantly, the Internet, as an electronic communication mechanism, is easily accessible to clients, employees, customers, and vendors at a consumer level through the use of a browser application.
An example of ITES BPO delivered over the Internet is a web-based customer service help desk system. Companies hire service firms to manage the email help desk that is part of a company’s website. The service provider uses a software solution to manage contacts by customers. Customers submit trouble tickets electronically over the Internet. The service provider processes the tickets and answers the questions via email.
Another example is document processing. A company that needs information culled from documents can hire an ITES BPO service provider to handle the documents electronically. The documents can be transmitted to the firm electronically over the Internet or, if they are in hard copy, scanned and then transmitted. Employees of the service provider process the document into a database, code information, categorize content, and clean up character recognition as required. The database is also accessible to the client company and its employees over the Internet.