SOA Research Library

Many different factors contribute to the cost of a business process outsourcing (BPO) engagement. Among them, IT, especially software, is a key cost determinant that is often underestimated. Technology drives the BPO cost structure in three ways: it enables economies of scale, supports sustainable process optimization, and makes labor arbitrage possible by connecting and controlling remote location workflows. This white paper examines the cost structure associated with BPO and shows that an assessment needs to address several cost components that are not included in the provider's total contract value (TCV), and are often overlooked by buyers.