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Human Resource Outsourcing 3.0: Knowledge Process Outsourcing

The next wave of human resource outsourcing kicks the consulting relationship up a notch to high-value knowledge support functions. Knowledge process outsourcing (KPO) offers businesses access to a vast pool of skilled workers trained in research and product development, quantitative analytics, and more. Find out how your business can build its global competitive advantage by outsourcing knowledge processes.

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Human resource outsourcing (HRO) has fueled its astonishing growth on the strength of cost savings and gains in operational efficiency. The next chapter of this success story expands the focus of business process outsourcing from operations to strategic, knowledge-based work.

Human Resource Outsourcing for the Information Age
Knowledge process outsourcing (KPO) allows companies to tap into an external pool of highly-skilled workers to carry out specific business initiatives. Since most human resource outsourcing providers maintain worldwide networks of knowledge workers, businesses can typically tap into precisely the expertise they need, on demand.

KPO at a Glance
Knowledge process outsourcing expands the scope of human resource outsourcing from the back office to high-value front office functions. Traditional HRO focuses on operational necessities, such as customer service, call center functions, and accounting services, while KPO features support directly related to strategic decision-making such as research and intermediate-level Randamp;D.

Some of the high-demand knowledge processes subject to outsourcing include:

Legal: patent and copyright functions, legal research
Financial: financial modeling and quantitative and fixed-income research, credit scoring loss protection calculations, fraud analytics
Randamp;D: pharmaceuticals, biotechnology
Research: market research, equity research, financial modeling
Design: automotive and aerospace, animation and simulation
IT: database creation, programming

Benefits of Outsourcing Knowledge Processes
Outsourcing human resources typically presents a cost and operational advantage. KPO offers these benefits, and much more. The real payoff is the strategic advantage: clients focus on their core abilities while accelerating the time to completion of outsourced initiatives. Ritesh Idnani, sales manager at human resource outsourcing provider Progeon, notes that KPO lets organizations do fairly complex operations, while getting the added benefit of improved time to market..

The Future of Human Resource Outsourcing
These benefits could play an increasingly important role as the global economy evolves. KPO allows businesses to focus on their core competencies, reduce product development lifecycles, and develop the flexibility to respond instantly to global market trends. To realize these benefits in strategic human resource outsourcing, its important to establish an ongoing relationship with a trusted KPO service provider.

A 2008 KPMG International Report confirmed the critical role KPO could play in the global economy. According to Network World, the financial services sector alone, KPO services will account for $5 billion in revenue by 2010. Businesses that partner with knowledge process outsourcing providers can get in on this trend on the ground level, and build the talent pool they need to remain competitive in tomorrows economy.

Sources
HRO Today
Network World
PhysOrg.com