In outsourcing, as in the broader business universe, specialized skills are worth far more than general qualifications.
So it’s no surprise, then, that Indian firms eager to compete head-to-head with companies like IBM and Accenture are trying to advance up the outsourcing food chain by offering knowledge process outsourcing. Unlike business process outsourcing, which focuses on mundane back-office functions like payroll, KPO demands more specialized knowledge in specific verticals like law and biotech.
One KPO vendor interviewed in a recent Reuters article thinks the market will quadruple in the next five years, reaching $10 billion to $12 billion by 2012. Outsourcing firms earn up to 50 percent more for KPO than for call center work, a market with such rapidly shrinking margins that some firms decline to provide it unless it is part of a broader and more profitable contract.
