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BPO Services: Next Growth Engine for the Developing World - by Priyanka Ghosh & Alvika Derhgawen * Page - 4 2. EVOLUTION OF BPO 2.1 BPO Evolution: From Time-Sharing to Off Shoring Outsourcing started as hiring outside vendors to perform specific tasks or manage specific projects within a department of a large organization. Recently, companies have strategically transformed their business by outsourcing entire technology operations or business processes, such as logistics, customer relationship management, and finance. In human resources, outsourcing started twenty years ago with pension plans and payroll. Today, it has evolved to recruiting, hiring, and performance management. The change that is taking place with BPO is from transactional (task) to strategic (process). A fundamental shift from an administrative and tactical focus to a deliberate competitive leverage has occurred. The reason is that companies are becoming more demanding. After a decade of outsourcing their non-core functions, cost-cutting, and improved service levels are not enough of a benefit to outsource.
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