What is an Outsourcing Company?
Outsourcing companyAn outsourcing company is a third-party firm that runs business functions — from IT to back-office work — for another firm under contract. It bundles specialised staff plus process capacity, so clients pay for outputs, not fixed overhead or headcount.
The category spans call centres, IT service firms, KPO shops, bookkeeping outfits, and dedicated offshore teams. Deals range from a five-seat inbound queue to a 2,000-agent operation.
Most contracts sit inside a defined SLA, priced by seats, tickets, or outcomes. The buyer keeps strategy and brand; the provider owns delivery, recruitment, and day-to-day management of the outsourcing work.
Key takeaways An outsourcing company delivers defined business functions for another firm under contract, priced by seat, ticket, or outcome.
Offerings span BPO, KPO, IT services, back-office, and dedicated offshore teams — from five-seat trials to 2,000-agent programmes.
Cost savings run 50-70% on labour; buyers keep strategy and IP, while providers own recruiting and delivery.
The Philippines and India dominate volume; nearshore hubs like Mexico and Colombia serve US time zones. How it worksAn outsourcing company takes over a defined process from a client, then runs it with its own staff, tools, and managers. Fees flow through a signed SLA that sets scope, response times, quality thresholds, and pricing — typically per seat, ticket, or outcome.
The engagement follows four phases: scoping, transition, steady-state, and continuous improvement. Scoping documents the workflow and success metrics. Transition trains the provider's team, then steady-state runs against the SLA with monthly reporting.
Providers charge in three common ways. Seat-based pricing bills a monthly rate per agent, common in contact centre work.
Transactional pricing bills per ticket, call, or invoice. Outcome-based pricing ties fees to KPIs like resolution time or collections recovered.
The market keeps expanding. Global BPO revenue hit roughly USD 348 billion in 2025 and is projected to grow at 10.05% CAGR through 2035, per Precedence Research.
Finance-and-accounting outsourcing alone was worth USD 54.8 billion in 2025, per Mordor Intelligence.
The Philippines IT-BPM sector generated about USD 40 billion in 2024 revenue and employed 1.9 million people, per the IT and Business Process Association of the Philippines. Growth targets aim past 2.5 million workers by 2028.
According to Gartner, customer service and support is one of the fastest-growing enterprise-software slices heading into 2026, which lifts demand for third-party contact-centre providers.
ExamplesReal-world outsourcing companies work across contact centre, IT, finance, and creative disciplines. The four examples below span geography and specialism, with Manila, Bengaluru, and Bogotá each turning up on the roster of buyers hiring in 2025.
Accenture is a global consulting-and-outsourcing firm based in Dublin. It reported USD 64.9 billion in FY2024 revenue and employs around 774,000 people. Its Manila and Bengaluru centres run banking, insurance, and IT support for Fortune 500 buyers.
Concentrix is a Newark, California-based CX and customer-service provider. It reported USD 9.6 billion in FY2024 revenue after absorbing Webhelp in 2023. The firm employs roughly 440,000 people across 70+ countries, with major Philippine and Indian sites.
TDCX is a Singapore-headquartered digital CX specialist listed on the NYSE since 2021. It reported USD 481 million in FY2024 revenue and runs sites across Malaysia, the Philippines, Singapore, and Colombia. Clients include Airbnb, Netflix, and OpenAI.
Teleperformance is a Paris-listed CX and specialised services firm founded in 1978. It generated EUR 10.3 billion in 2024 revenue and employs about 500,000 people in 100+ countries. The provider anchors Colombia's nearshore market and Portugal's multilingual hub.
Related termsBuyers often confuse an outsourcing company with adjacent operating models. Each related term below carries a distinct scope, contract shape, and pricing logic worth checking before RFP goes out.
Business process outsourcing (BPO): the parent category, covering any non-core function delegated to a specialist provider. Knowledge process outsourcing (KPO): analytics, legal research, and other judgment-heavy work priced above BPO. Offshoring: moving work overseas, whether to a captive centre or an outsourcing company. Nearshoring: outsourcing to a country in a similar time zone, like Mexico or Colombia for US buyers. Service level agreement: the contract clause that binds a provider to response times, uptime, and quality thresholds. Back office: the internal admin and finance work most commonly handed to an outsourcing company. FAQ What does an outsourcing company do?An outsourcing company runs defined business processes such as customer service, IT, finance, HR, or back-office work for another firm. It supplies the people, tools, and management under a service level agreement, then bills by seat, ticket, or outcome.
How is an outsourcing company different from a BPO?BPO is a category. An outsourcing company is any single provider inside it. All BPO firms are outsourcing companies, but the term also covers IT services, KPO, and specialist creative or engineering shops that fall outside classic business-process work.
How much does outsourcing cost?Labour rates run 50-70% below US and UK equivalents in offshore hubs. A Philippine contact-centre agent typically costs USD 8-12 per hour fully loaded in 2025, versus USD 25-35 in the US. Overheads, ramp, and management fees add 15-30%.
Which countries lead the outsourcing company market?The Philippines leads voice-based CX at USD 40 billion in 2024 with 1.9 million workers. India dominates IT and back-office at USD 250+ billion in exports. Mexico, Colombia, and Poland handle nearshore volume for US and EU buyers.
How do I choose an outsourcing company?Match the provider's speciality to the process, not the pitch; check dated financials, named clients, retention rates, and a live SLA sample. A three-month paid pilot on a small scope surfaces delivery risks before you commit to a 100-seat contract.
Compare vetted providers across the Philippines, India, and Latin America inside the OA directory.
What is Fully Managed Outsourcing?
Fully Managed OutsourcingFully managed outsourcing is a model where the provider owns the whole engagement, from people and process to tools, QA, and KPIs, not just the seats you rent. The client sets the outcomes; the vendor runs everything else. You buy a working operation with a single accountable owner, not a headcount contract.
The seat-only model puts you in charge of ramp, attrition, training, QA, and reporting. Fully managed flips that. The provider carries the ops burden and reports to you on business outcomes like first-contact resolution, cost per contact, and CSAT, instead of hours logged.
It fits when you don't have deep BPO know-how in-house, when the function isn't your core, or when your headcount plan moves faster than HR can hire. Marketing ops, finance and accounting, and customer service are the usual candidates.
Key takeaways Vendor owns people, process, tools, QA, and reporting; client owns outcomes.
Typical savings run 40-70% versus onshore in-house builds.
Best for non-core functions with clear SLAs like CX, finance and accounting, and back-office.
The vendor bills for outcomes or an all-in monthly fee tied to service levels.
Governance still matters: SLAs, QBRs, and clean data escrow keep control with the client. How it worksFully managed outsourcing works as a turnkey operation. The provider designs the workflow, hires and trains agents, builds the QA layer, runs day-to-day ops, and reports outcomes against agreed KPIs. You approve the SLA and review results; you don't run the floor.
The split of responsibility matters. Here is how the two most common models compare in practice:
Function
Seat-only vendor
Fully managed vendor Recruitment
Shared
Vendor Training and QA
Client
Vendor Tools and tech stack
Client
Vendor Reporting cadence
Ad hoc
Contracted SLA KPI ownership
Client
VendorWhat sits behind the SLA is the operating model. The provider maps workflow states, sets a QA cadence, picks a workforce management tool, and defines escalation paths. You get a runbook, not a staff list.
If a process step needs redesign mid-contract, the provider proposes it and you sign off. That is the difference between renting labour and buying an operation.
Commercials follow the same logic. You pay for outcomes — per resolved ticket, per closed book, per compliant filing — or a fixed monthly fee tied to service levels. Precedence Research valued the global BPO market at USD 347.95 billion in 2025, projecting 10.05% CAGR through 2035.
ExamplesReal fully managed engagements show up across CX, back-office, and knowledge work. The vendor's name is on the operation, not just the invoice. Below are named providers, dates, and how the model runs in practice.
Teleperformance posted EUR 8.3 billion in 2023 revenue running fully managed CX for banks, telcos, and e-commerce brands. Clients hand over the customer contact function; Teleperformance owns hiring, training, tech, and SLAs, and reports back on CSAT and first-contact resolution.
Concentrix runs 440,000 agents across 70 countries. When a US retailer moves its returns operation to Concentrix, the retailer signs an SLA and reviews a monthly scorecard. Concentrix decides the ops model, the roster, and the escalation ladder.
Accenture Operations delivers fully managed finance, procurement, and marketing operations for Fortune 500 clients. A typical engagement replaces the client's captive shared-services center with an Accenture-run team on Accenture's tools, priced against transactions closed and cycle-time targets, not headcount.
The Philippine IT-BPM sector runs on this model at scale. IBPAP reports roughly 1.9 million workers and USD 40 billion in revenue as of its 2024 industry roadmap. Fully managed CX and finance-and-accounting are the two biggest revenue lines feeding US, UK, and Australian clients.
Alorica operates as a fully managed CX provider across the Philippines, India, and Latin America. A retail client typically hands over 200-500 seats, and Alorica hits contracted first-contact resolution targets that match ContactBabel's 2024 top-quartile 78% benchmark.
Related termsFully managed outsourcing sits inside a broader outsourcing vocabulary. The related glossary entries below clarify how it differs from staff leasing, seat-only BPO, offshoring by geography, and function-specific service models you can buy alone.
Business process outsourcing (BPO) — the parent category; fully managed is its deepest tier. Offshoring: a location choice, not an ownership choice. Service level agreement: the contract that makes fully managed enforceable. Back office: the function set most often bought fully managed. Virtual assistant — the opposite end of the spectrum, a single seat with minimal client management. FAQ Is fully managed outsourcing the same as BPO?No. BPO is the parent category. Fully managed is the deepest tier, where the vendor owns process, staff, tools, and outcomes, not just the seats.
How much can fully managed outsourcing save?Onshore-to-offshore fully managed engagements typically cut cost 40-70% depending on function and geography. Savings vary with wage arbitrage, tool licensing, and how much QA overhead the client used to carry.
What functions work best fully managed?Customer service, finance and accounting, IT helpdesk, back-office data work, and content moderation are the usual fits. They have clear SLAs, repeatable workflows, and outcome metrics you can put in a contract.
Who owns the KPIs?The vendor owns delivery against contracted KPIs. The client owns which KPIs matter and reviews performance at monthly or quarterly business reviews.
What are the biggest risks?Vendor lock-in, opaque quality data, and data-portability gaps if the relationship ends. Guard against them with SLA teeth, quarterly QBRs, and a documented exit clause that returns process docs and clean data.
See how fully managed providers stack up in the Outsource Accelerator hubs directory.
Full-time employee definition
Full-Time Employee (FTE)A full-time employee (FTE) is a worker who is exclusively employed by one company, typically clocking 30 to 40+ hours a week under a permanent contract. The FTE label decides tax withholding, benefits eligibility, and payroll cadence — and it's the accounting unit outsourcing firms use to price staffing contracts.
The FTE tag matters because it separates workers on payroll, with tax withholding, mandated benefits, and steady hours, from contractors, freelancers, and part-time status staff who fall under looser rules. Misclassifying an FTE triggers back-tax exposure and benefits claims that dwarf any short-term saving.
FTE also serves as the industry's staffing currency. When a Manila BPO industry provider quotes a 20-seat contract, each seat represents one FTE billed monthly. That model lets buyers benchmark outsourcing, offshoring, and nearshoring options against in-house payroll on the same footing.
Key takeaways Full-time employees work exclusively for one employer — usually 30–40+ hours per week under a permanent contract.
FTE status triggers legal duties around tax withholding, benefits, and workplace protections that don't apply to contractors.
Outsourcing firms price contracts by FTE-per-month, letting buyers benchmark BPO spend against in-house payroll.
Global BPO revenues hit roughly USD 348 billion in 2025, with offshore FTEs costing a fraction of onshore equivalents.
Misclassifying an FTE as a contractor draws back-tax and benefits claims that outweigh short-term savings. How it worksA full-time employee signs an exclusive contract, earns a fixed salary or hourly wage, and picks up statutory benefits like health cover and paid leave. Employers withhold tax, register the worker with an IRS employer ID, and pay on a set schedule.
The mechanics come down to four things: the contract, the hours, the pay cycle, and the reporting duty. US federal law also requires employers to report new hires within 20 days so states can enforce child-support orders.
Pay cycle
Frequency
Common use Weekly
52 runs/year
Hourly and blue-collar FTEs Biweekly
26 runs/year
Salaried professional roles Semi-monthly
24 runs/year
Corporate and admin staff Monthly
12 runs/year
Executive and offshore FTEsThe choice of pay schedules affects cash flow and worker satisfaction. Firms that outsource the payroll process inherit those cycles through the vendor's software.
ExamplesFTEs sit at the heart of every high-volume service function. From a call centre agent taking inbound tickets in Cebu to a graphic designer running production for a US ad agency, the FTE model powers roles that need consistent, salaried attention.
Contact centre agent. A contact centre FTE in the Philippines typically earns USD 350–500 per month at entry level and USD 700–900 with three years' experience. Providers price the seat all-in, including workstation and management overhead. Harvard Business Review's 2017 study on high-performing contact centres found that tenured FTEs beat churn-heavy rosters on first contact resolution, a pattern the earlier HBR piece on customer delight predicted.
Design and graphics FTE. A full-time offshore designer handling design and graphics work for a US agency runs about USD 1,200–2,000 per month — one-fifth the cost of the onshore equivalent, whose US Bureau of Labor Statistics median wage sat near USD 39,680 in 2024.
Customer service specialist. Customer service FTEs anchor the customer experience (CX) function. Everest Group's CX research tracks how CX outsourcing has shifted from raw staff augmentation toward outcome-based FTE pods that report on customer satisfaction score instead of raw call volume.
Payroll and back-office FTE. Back office FTEs handle payroll, accounting, and admin. Precedence Research values the global BPO market at roughly USD 348 billion in 2025, with most of that spend funding offshore FTEs.
Related termsFull-time employee sits next to a cluster of outsourcing, staffing, and contact-centre terms — knowing which one applies stops you overpaying for the wrong staffing model or under-scoping a vendor contract.
Business Process Outsourcing (BPO): Transfer of business functions to a third-party provider, priced by FTE-per-month. Outsourcing: The broader practice of contracting external firms for work an in-house FTE could handle. Offshoring: Sending an FTE role to a lower-cost country, usually eight or more time zones from headquarters. Nearshoring: Placing FTEs in an adjacent country to keep overlap with headquarters hours.
Knowledge Process Outsourcing: Higher-skill FTE work such as legal research or financial modelling.
Service Level Agreement: Contract governing the FTE's output, uptime, and quality metrics.
Inbound Call Centre: Team of FTEs answering customer-initiated calls, often measured on first-call resolution. FAQ What qualifies someone as a full-time employee?Any worker who signs an exclusive contract, works the employer's standard weekly hours of 30 to 40+, and receives pay through payroll rather than invoice. The role must also carry the benefits and tax withholding that local law attaches to permanent staff.
How is an FTE different from a contractor?A contractor invoices their own business, sets their own hours, and pays their own tax. An FTE goes through payroll, follows a set schedule, and receives statutory benefits. Regulators use control, exclusivity, and integration tests to police the line.
How much does a Philippines FTE cost?An entry-level customer service FTE in Manila costs roughly USD 350–500 per month all-in, rising to USD 700–900 for tenured agents. The IT and Business Process Association of the Philippines reports the sector employing about 1.9 million people at those price points.
Can I convert a contractor to an FTE?Yes, and it's often the safer path when the person already works full-time hours for one client. Draw up an employment contract, register them with your payroll provider, backdate benefits per local law, and confirm any pending invoices roll into salary.
Where can I benchmark FTE vendors?Directories like Clutch's BPO listings and industry research from ContactBabel give you unfiltered vendor comparisons. Cross-check the seat price against what an in-house FTE costs after benefits, tax, and real-estate loading.
Ready to price out an FTE for your next role? Compare vetted providers on the Outsource Accelerator hubs.
What is What is business process outsourcing??
What is business process outsourcing?Business process outsourcing (BPO) is hiring a third-party provider to run a defined business function like customer support, payroll, or IT helpdesk. The provider takes ownership of the people, process, and technology, and bills per seat, transaction, or fixed fee.
BPO is a subset of outsourcing that focuses on repeatable, high-volume work. When those functions move to a lower-cost country, the setup is called offshoring.
Common categories include customer support, finance and accounting, HR, IT helpdesk, and other back-office work — plus higher-value knowledge processes like analytics or research.
Key takeaways BPO shifts a defined function to an external provider under a written contract.
Pricing models fall into per-FTE, per-transaction, outcome-based, or hybrid buckets.
The Philippines and India lead global BPO delivery through 2025.
Cost drives many deals, but access to talent and 24/7 coverage matter just as much.
A service level agreement sets the quality bar and remedies for the relationship. How it worksBPO works by transferring a defined process to a specialized vendor under a written contract. You keep strategic control; the provider owns staffing, tools, and daily execution.
Pricing usually follows one of four models — per-seat, per-transaction, outcome-based, or a hybrid mix.
Companies choose BPO for three reasons: lower cost, access to specialized talent, and the ability to convert fixed headcount into variable operating expense. Most enterprise buyers combine two or three of these goals in the same contract.
Most engagements start with discovery. The client documents the process, sets KPIs, and defines escalation paths. The provider then hires, trains, and shadows before going live — typically 6 to 12 weeks.
The pricing model shapes risk. Per-seat fees favor steady work; outcome-based fees push accountability onto the provider. Most contracts also include a service level agreement that ties bonuses or penalties to defined performance targets.
Model
How you pay
Best for Per FTE (seat)
Fixed monthly rate per agent
Steady-volume work like inbound support Per transaction
Set fee per call, ticket, or invoice
Variable-volume back-office tasks Outcome-based
Tied to a KPI like CSAT or collections
Mature processes with clean metrics Hybrid
Base FTE rate plus variable bonus
Long-term partnershipsContracts usually run 2 to 5 years with annual price adjustments. Buyers should build off-boarding clauses upfront so the process can move back in-house or to another vendor if performance slips.
The upside is clear: cost reduction of 30-60%, faster staffing, and 24/7 coverage using follow-the-sun teams. The trade-off is management overhead, cultural distance, and dependency on a single provider for critical work.
Provider selection now weighs security posture and data residency more than a decade ago.
GDPR, HIPAA, and PCI-DSS obligations flow from the client to the provider. Contracts spell out audit rights, penalty clauses, and breach reporting windows.
Location choice matters. Providers in the Philippines and India deliver English-language support at 40-70% below onshore rates, while nearshoring to Mexico or Colombia buys time-zone alignment. Onshoring stays domestic but costs the most.
ExamplesBPO delivery clusters into three archetypes — call center hubs, knowledge process shops, and nearshore bilingual centers. Global BPO revenue reached USD 347.95 billion in 2024 with a projected 10.05% CAGR through 2035, per Precedence Research.
Buyers often start in the Philippines. English fluency, Filipino traits and values, and Western-facing culture reduce onboarding friction. It remains the top outsourcing destination for voice work heading into 2025.
Philippines call centers. The Philippines IT-BPM sector booked around USD 40 billion in 2024 with about 1.9 million employees, targeting 2.5 million by 2028.
Concentrix, Teleperformance, and TDCX all run major Manila and Cebu call center campuses. See the Top 40 BPO companies in the Philippines and this guide to call centers for hire.
India knowledge process outsourcing. Knowledge process outsourcing firms in Bengaluru and Gurgaon handle equity research, legal review, and analytics for Wall Street. WNS, Genpact, and EXL all posted multi-billion-dollar revenues in 2024.
Latin America customer support. Colombia, Mexico, and Costa Rica attract US fintechs and SaaS platforms wanting Spanish-English bilingual agents. Rankings on Clutch show Bogotá firms among the fastest-growing between 2022 and 2024.
Global finance and IT support. Accenture, IBM, and Cognizant deliver ERP support, cloud operations, and finance-and-accounting from delivery hubs in Poland, Ireland, and India. Their contracts often span 5 to 10 years and blend BPO with technology services.
Enterprise BPO deals are becoming more outcome-linked. Rather than paying per seat, buyers in 2024 increasingly pay for defined KPIs like first-call resolution or completed orders, which pushes performance risk back to the provider.
Related terms Offshoring: the practice of moving business functions to distant, lower-cost countries. Nearshoring: outsourcing to a country in a similar time zone, often for language or cultural fit. Onshoring: keeping outsourced work inside the client's home country. Knowledge Process Outsourcing: outsourcing of higher-value analytical or specialist work such as research or legal review. Call Center: a facility built to handle inbound or outbound customer calls at scale. Back-Office: the non-customer-facing operations that support day-to-day business functions. Service Level Agreement: the contract clause that defines performance targets and remedies for a BPO deal. FAQ What is BPO in simple terms?BPO is when a company hires another business to run a specific function like customer service or payroll. The client sets the outcomes; the provider handles the day-to-day work.
What is the difference between BPO and outsourcing?Outsourcing is the umbrella term for contracting any external provider. BPO is the subset that covers full business functions like call centers, HR, or accounting, usually delivered offshore at scale.
Is BPO only about cost savings?No. Cost is the entry point, but most mature buyers cite access to specialized talent, 24/7 coverage, and scalability as the bigger long-term wins. Cost-only deals tend to churn within 18 months.
Which countries dominate BPO?The Philippines leads voice and English-language customer support. India dominates IT and knowledge process work. Mexico, Colombia, and Costa Rica anchor Latin America's nearshore market for US clients.
What functions do companies outsource most often?Customer support, IT helpdesk, finance and accounting, HR administration, and content moderation lead the pack. Higher-value work like data analytics and legal review is growing fastest.
How do I choose a BPO provider?Match the provider's specialization to your function, check industry references, and shortlist candidates using the Ultimate Guide to Outsourcing.
Explore vetted providers at Outsource Accelerator's BPO Directory
Independent
