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KPO Overview

Knowledge Process Outsourcing (KPO) is the extension of Business Process Outsourcing (BPO). KPO work started around 2000, when people realized that knowledge work, in addition to call centers and software development, could be outsourced to countries with an English-speaking talent pool.

KPO is the fastest-growing segment in the outsourcing domain and is expected to be a $17 billion global industry by 2010, up from$1.2 billion in 2003, according to a published report from the National Association of Software and Services Companies. High-end outsourcing is expected to grow at a CAGR of 46%, compared to a CAGR of 26% for low-end work. The industry presently employees 25,000 people and is expected to grow tenfold to 250,000 employees by 2010. Not all research companies concur with these growth estimates. Rocsearch, a UK-based research services company, estimates that the KPO market may only reach $5 billion by 2010 and be supported by 100,000 employees.

India, the Philippines, Russia, China, the Czech Republic, Ireland and Israel are all entering the KPO industry. By 2010, India is expected to have a 70 percent share of the KPO market.

Growth in the KPO sector has been fueled by the increased savings realized from outsourcing knowledge-based activities and the need of developed countries to find specialized and scarce talent.

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