Why choose India as the location for your Business Process Management Outsourcing?

Call centre trends for 2021

In today’s connected world, a successful business is often an efficient one, and the difference can come down to intelligent, innovative processes with suitably professional management to match. Novel, modern process management techniques can take your business from good to great. One outgrowth of BPM, business process outsourcing (BPO), can enable just such a change if enacted in a careful, conscientious manner and with a quality vendor.

What is BPO?

Business process outsourcing is outsourcing essential and non-essential functions of a company to a hired external services provider, called a BPO company.

Commonly outsourced processes include the following:

  • Accounting

  • Administration

  • Customer services and Call Centres

  • HR

  • IT management and services

  • Manufacturing

  • Marketing

  • Research

  • Sales

  • Shipping and logistics

What is BPO Used For?

Organizations contract with BPO vendors for two main areas:

  • Back office operations: They include payment processing, information technology services and quality assurance.

  • Front office operations: They include marketing, sales, customer relations, and grievance redressal.

Outsourcing to India

  • India is a land of opportunities and has always got attention from entrepreneurs around the globe. Providing cost-effective yet quality services, India has become a support system for most software companies in the western world

  • India is the best outsourcing destination for technical jobs compared to other outsourcing locations in Eastern Europe, the Pacific Rim, and Latin America.

  • There can be many advantages of outsourcing to India. Cost benefits and vast IT talent pool are just two!

A recent survey revealed that 80% of European and US firms choose India over any other country for their outsourcing requirement. Although other countries like China, the Philippines, Ireland, and Mexico are giving tough competition to India, the country remains the most preferred outsourcing destination. According to a new report from A.T. Kearney, India is the most attractive location in the world for Business Process Outsourcing (BPO). The combination of increasing skill-levels and widespread English proficiency are reportedly the primary contributors to the country’s attractiveness.

Some Statistics on Outsourcing to India

Reducing trade barriers and liberating economic policies are fuelling BPO growth. In 2019, the BPO market size stood at $221.5 billion, and it will continue to grow with a Compound Annual Growth Rate (CAGR) of 8% from 2020-2027. BPOs, over time, have added new offerings and are now catering to both core and non-core processes efficiently. From offering payroll services to assisting organizations with legal services, today, BPOs do it all.

  • According to Tholons 2016 Top 100 Outsourcing Destinations, Bangalore has the highest share of outsourcing business in India. Mumbai, Pune, Hyderabad, and Delhi are not far behind either. They are on the list of top 10 outsourcing destinations as well.

  • Hexagon Consulting suggests, India’s outsourcing business today stands at approximately $US 118 billion, clearly proving India’s dominance in the outsourcing landscape.

As per the A.T. Kearney’s 2019 Global Services Location Index, India is ranked 1st in terms of attractiveness for outsourcing. There are over 500 companies in India that are catering to the varying requirements of the western countries. Countries are selected on the basis of corporate input, current remote services activity, and government initiatives to promote the sector, and then evaluated on the basis of 38 criteria, which help determine their financial attractiveness, people skills and availability, as well as the overall business environment.

In fact, a Deloitte study, conducted on some global businesses, revealed that over 59% businesses are already outsourcing to India. Not just that, 22% of those that are not currently outsourcing to India are planning to do the same in the coming times.

List of Few Companies that Outsource their Back Office Services to India

Many companies that send their back-office work to India. A few of them are:

  • IBM

  • Vodafone

  • Telstra

  • BestBuy

  • American Express


  • Ford

  • Oracle

  • General Electric (GE)

  • Dell

But Why Choose India Over Other Outsourcing Destinations?

  • India offers a good mix of value and savings.

  • The country boasts the second-largest English-speaking population in the world.

  • The Indian workforce is skilled.

  • Infrastructure is solid and getting stronger by the day.

  • The country has outsourcing-friendly policies.

Some Indian BPO Facts:

  • According to the National Association of Software and Services Companies (NASSCOM), the IT and BPO trade body in India, a total of 1.1 million people worked in the Indian BPO industry.

  • Over 500 companies in India offer outsourcing services to over 66 countries. About 200 multinational corporations operate out of India.

  • The IT-BPO industry grew by 8 percent, leading to aggregate revenue of $154 Billion.

  • The BPO sector contributes 7.7 percent to India’s GDP.

Segmentation of IT and BPO Services Market in India

BPO is now an integral part of a variety of industries, including healthcare, retail and e-commerce, banking, asset management, supply chain management, and business services. Because BPO has become so prevalent, several niche BPO specialties have bloomed into existence in India.

The three main categories include:

  • Knowledge Process Outsourcing (KPO)

  • Knowledge Process Outsourcing takes place when a company outsources work to a service provider for their specialization and expertise in the process. This expertise may expand past process expertise, into business and domain-based expertise.

  • Legal Process Outsourcing (LPO)

  • Legal Process Outsourcing is a type of knowledge process outsourcing (KPO) that is specific to legal services. LPO includes services like conducting legal research, drafting legal documents, and even providing legal advice. LPO is excellent for back office outsourcing

  • Research Process Outsourcing (RPO)

  • Research Process Outsourcing is another type of KPO that specifically entails research and analysis functions. Examples of organizations that would engage in RPO include biotech companies, investment firms, and marketing agencies.

Other BPO categories are

  • Information Technology-Enabled Services (ITES)

  • Information Technology-Enabled Services is a form of BPO that delivers IT services through leveraging information technology (IT) over the internet or data network. IT outsourcing job examples include service desk analyst, IT analyst, production support analyst, and technical support.

  • Travel

  • A company may outsource the processes necessary to support its travel logistics. Outsourcing services such as ticket and hotel booking can save time and money while increasing customer satisfaction. Even travel companies such as airlines use travel BPO to enhance business productivity.

Motivations to Outsource

The main reasons why companies outsource are:

  • To cut costs while being able to focus on core business. The primary goal of outsourcing is to reduce the costs associated with employing additional in-house teams massively, and in doing so, gain value for the host organisation. For outsourcing to be economically viable, savings from the lower wage rate must exceed the increased cost of management and any associated risks.

  • Companies often overlook the additional benefit of generating higher customer retention rates through outsourcing services.Combining innovative practices, intelligent and talented subject matter experts, and speedy execution leads to remarkable increases in customer retention.

  • Additionally, outsourced services provide a certain amount of flexibility. Signing on for the services of an outsourcing company with an extensive list of vendors in their arsenal enables companies to scale up or down based on customer demand whenever the need arises. This is a valuable asset during the peak and valley periods of the year.

Next Generation Growth in BPO

Over the last two decades, BPO was seen as a great business model for saving cost and increasing efficiencies. However, COVID-19 and recent technology changes have come across as a wake-up call for companies and have increased the opportunities in outsourcing.

The global Business Process Outsourcing (BPO) Market was valued at $203.8Billion in 2018 and is forecast to grow at a modest 8.1% CAGR between 2018 and 2026, culminating in 2026 global sales of $360.76Billion.

  • Transformation in the business models and practices in the generic domains like manufacturing, financial services, and technology i.e. low cost delivery are leading the demand for next level of BPO market.

  • The new countenances like education, retail, health, and media sectors i.e. emerging growth drivers and new business models like cloud-based offering are promising contributors to the BPO domain. Drives Broader Transformational Change

  • With more than 50 percent market in global business, India stands a good chance to maintain its position and increase competence in the existing and new BPO domains


Outsourcing has become a way of life for businesses to advance their operations, boost business growth and efficiency. Although other countries like China, the Philippines, Ireland, and Mexico are giving tough competition to India, the country remains the most preferred outsourcing destination. We at CogentHub provide innovative quality services for all your Business Process Management outsourcing requirements. Partnering with us will significantly improve your productivity and keep you ahead of the curve!

About the Author

Debarpita has completed her post-graduation in Applied Geology from Presidency University, Kolkata, India. Her key areas are Content writing and Research. She is in this industry for one year. Her areas of interest include palaeontology, writing, travelling and listening to audiobooks.

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