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We can consider following points to explain difference between BPO and KPO. BPO stands for Business Process Outsourcing & KPO stands for Knowledge Process Outsourcing. KPO is more specific, specialized, skilled and knowledge based system as compared to BPO. We can differentiate these two with the help of following points to find which one is better.

KPO Vs. BPO : Difference between BPO and KPO

Points BPO KPO
Full Form Business Process Outsourcing Knowledge Process Outsourcing
Subset subset of outsourcing subset of BPO
Work Nature Contract of the responsibilities of some specific business processes or services to the third party outsourcing of core information-related business activities
Skills required Communication Skills, Basic knowledge & language advanced analytical skills, technical skills, high degree of specialist expertise
Categories Front Office – client interaction and customer support, Call centre services intellectual property research for patent applications; equity research, business and market research, legal and medical services; training, consultancy, and research and development in fields such as pharmaceuticals and biotechnology; and animation and design
Back Office – internal business functions i.e. finance, accounting and HR
other categories – Offshore and nearshore outsourcing  –
Focus/ Motive Cost Reduction or Cost Saving  To get specialized Knowledge based solutions, R & D etc. Not just Cost Reduction
Business processes Information technology based (ITES-BPO)  Not just IT based, Also includes spcialized knowledge
Functions Document processing Engineering Designing, Drafting and Rendering – Mechanical, Structural, Architectural and Civil 
Data entry, Data analytic – Data/market/IP research Legal Process Outsourcing (LPO)
Customer Service, Customer Support, Help desk  Technical Writing & Communications 
Billing, verification  Remote IT infrastructure Management – Helpdesk, OS, Applications, Database Administration, Maintenance & support etc. 
Transcriptions Animation, 2D, 3D modeling etc.
Outbound/Inbound Calling, Market /Competitor research
Investment Low to Medium  Medium to High
Qualification Required Basic  Education is enough  Competent & Specialised
Training Less Rigorous More Rigorous  & sector based
Research before contract Less  More extensive
Challenge Less More
Period Long term Short term nature as compared to BPO
Overall Revenue High as compared to KPO
Result  better than BPO
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