Yes, they were different!
The global market sees how Business Process Outsourcing generated millionaire income. In the Philippines alone, IT-BPO revenue increased 17% to $15.5 billion in 2014. On the other hand, Business Process Management, Global Market Research analysts said the global BPM market will reach $5.3 billion for 2017. Those are just a few of the positive effects of both BPO and what we now call BPM.
But before that, what is the difference of these two different worlds? Which is more effective and productive? All of that and more as we take a look at these different economic cycles.
BPO: Outsourced Operations
Business process outsourcing (BPO) is a subset of outsourcing that involves hiring an outside company to handle business operations for you. BPO that is contracted out of a company’s own country is sometimes referred to as offshore outsourcing.
BPO that is contracted to a company’s neighboring country is sometimes referred to as nearshore outsourcing, and BPO that is contracted to the company’s own country is sometimes referred to as onshore subcontracting. Commonly, BPO is carried out for many reasons such as low cost, effective labor and others.
Business outsourcing today also focuses on hiring companies to perform those non-core business administration processes that typically involve voice, financial and administrative processes, human resources functions, and customer representative functions.
Another term attached to this is the KPO. Knowledge process outsourcing is a subset of outsourcing that deals with the contracting of a company that requires the handling of a specific, high skill and experience job, such as an insurance job, among others.
Types of BPO Services:
1. Telemarketing
2. Technical support
3. customer support
4.Insurance processing
5. IT support
6. Data processing
7. Data conversion
8.accounting services
9. Research and writing web content
Among all these types of BPO service, customer service ranks first in the process outsourced by a company. Followed by non-voice such as technical support, insurance processing, etc.
BPM: A Business Management Approach
If BPO is a subset of outsourcing, BPM is a subset of infrastructure management.
Business Process Management (BPM) is a systematic approach to making an organization’s workflow more effective, more efficient, and better able to adapt to a constantly changing environment. The BPM aims to eliminate human errors and miscommunication based on the requirements of the company’s objectives.
To keep things simple, BPO is a business process, while BPM is a systematic approach to business operations. BPM, since it is a systematic approach, is more comprehensive and goal-oriented that follows specific procedures. Furthermore, it was considered that BPM has a life cycle that includes the following:
1. designing the process. What is the existing process? What and how to develop?
2. Modeling the design. Are there changes in the process? Are there changes in costs, variables, financial, structural, physical aspects that affect the process?
3. Running the process. Are you going to use an app? Human intervention or combined?
4. Process monitoring. Are there vital observations, observed changes? Are the statistics and observations properly analyzed? Do these affect the process?
5. Optimizing the process. How will you change the process? Are there process changes to maintain for improvement?
6. Process reengineering. Is it necessary to redesign it? What process should be under reengineering?
CONCLUSION
Although the Business Process Outsourcing scheme is an abrupt type of business today, it is still essential not to differentiate between it and Business Process Management. BP is the process of a business, typically a business does while outsourcing its operation to third-party workers, whereas BPM is an approach that focuses on making a business process more effective, productive, and more adaptable to a commercial environment. To keep things simple, BPO is a process and BPM is an approach.