We found this great article on BPO outsourcing on www.Transformmag.com... check it out below!

Is BPO the Way to Go?Business-process outsourcing can transform performance without the capital investment. The catch: You'll have to settle for standard processes.

by Steve Marlin and Doug Henschen
November 1, 2004

Business-process outsourcing (BPO) is one of the hottest trends in IT services.

Just don't confuse it with offshoring, a contentious issue that's likely to stir emotions into the 2008 election season and beyond.

BPO is the delegation of an IT-enabled business process to a third party that assumes ownership, administration and management of that process. Businesses will pay service providers at least $131 billion to handle processes in 2004, Gartner predicts. Offshoring, the practice of sending labor-intensive tasks to low-cost workers in foreign markets, will account for only about 1 percent of that total.

"If you compare the coverage [of outsourcing] in the press and the claims of the providers to the total market, it doesn't make sense that it's getting so much attention," says Gartner analyst Lisa Stone. "The press is equating outsourcing with offshoring."

There's no doubt that businesses are turning to BPO. The practice will grow 32 percent to $173 billion by 2007, according to Gartner, and it will account for 56 percent of IT services expenditures worldwide by 2008, up from 53 percent this year.

BPO is distinct from IT-services outsourcing, in which a company farms out lights-on operations or application development to a service provider (an area in which offshoring is more commonplace, Stone says). BPO is far more strategic, calling for finesse on the part of both the customer and the service provider.

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