Knowledge Process Outsourcing

In today’s age of globalization, converging technologies of telecommunication and information technology have redefined the way we do business. This has lead to opening of many opportunities where best-in-class talent across the world can be leveraged to provide specialized services. Companies have realized the value of outsourcing specialized tasks to low-cost destinations such as India. The success in outsourcing business process operations to India has encouraged many firms to start outsourcing their high-end knowledge work as well, popularly referred to as KPO ( Knowledge Process Outsourcing ). According to a report by NASSCOM, KPO business is expected to reach USD 17 billion by 2010, of which USD 12 billion (71%) would be outsourced to India.

The last few years have witnessed explosive growth in the KPO sector in India. Already, the top 12 investment banks of the world such as GE Capital, American Express and Citibank, have already outsourced a part of their analytics work to their captive centers in India, employing 1,200 people that is expected to go up to about 6000 in the next two years.

There are few niche analytics providers such as Fractal Analytics who have established a benchmark by providing analytic solutions to various sectors ranging from financial services , retail to telecom and Insurance . They target those companies which are looking at outsourcing even some of their core businesses functions like analytics and business intelligence.

The global analytics or data mining market, which was $ 8.4 billion in 2000, is expected to grow at 35 to 40 per cent annually for the next 10 years. It has been estimated that the amount of information in the world doubles every 20 months and the size and number of databases increase even faster. Past years have seen an exponential growth in the volume of information or data being stored in electronic format. Since data analysis is essential for businesses, it requires going beyond the data explicitly stored to derive knowledge about the business which is where data mining fits in.

Data mining techniques are used most effectively in the banking and financial services industry. Some of these analytics activities include identifying customers before acquisition, and then retain them with the help of attrition models. Companies like Fractal Analytics provide a very wide range of analytic solutions from behavior analysis, credit scoring models to cross sell models, to help financial firms and banks reduce risk and acquire profitable customers.

Insurance and retail are other areas where data mining applications are used extensively. The techniques are used for claims analysis such as developing predictive recovery models, scoring, and data visualization mechanisms to check fraudulent claims. With the help of spend analytics, customer loyalty analytics retailers have been able to increase their marketing ROI by optimizing their pricing strategy. Henceforth, companies like EvalueServe, Fair Isaac and Fractal Analytics are all set to tap the analytics outsourcing opportunities which is estimated to touch $24 billion mark in 2008.

For more information on Analytics Outsourcing , visit following links:

Outsourcing becoming knowledge outsourcing

Knowledge Process Outsourcing to India

India: Most preferred destination for KPO

Analytics Outsourcing in India

Leading insurance company increases cross-sell conversion by 40% and annual profit by $600,000

ICICI bank increases approvals without increasing default rates

Credit card issuer increases spend per customer through advanced spend analytics

Auto part distributor reduces defaults through behavioral risk models

Drivers analysis enable a retailer to understand drivers of quality perception

Tags: Analytics, Fractal Analytics, Knowledge Process, Outsourcing