Key takeaways
- BPO assigns work to another company, while call centers handle customer phone conversations.
- In a BPO call center, an external provider handles another business’s incoming or outgoing calls.
- Companies can employ their own call center agents or hire an outside team.
- Outsourcing costs depend on call volume and the services outsourced, so lower rates don’t guarantee savings.
One provider advertises “BPO,” another promotes a “call center,” and both appear to offer customer support. With “BPO call center” also in the mix, identifying what each company actually provides takes more than comparing its advertising.
Separating the outsourcing arrangement from the telephone service helps explain these overlapping labels. Their differences show how providers divide responsibility for operations and customer calls.
What is BPO?
Business process outsourcing (BPO) means hiring another company to manage part of a business’s regular work. Through a contract, the provider takes responsibility for tasks such as payroll or customer support.
The business still controls decisions outside that agreement. For example, a payroll provider calculates wages and prepares payments, but the employer decides how much each employee earns.
BPO handles customer-facing work and behind-the-scenes tasks:
- Front-office BPO: External teams answer customer questions or help with sales.
- Back-office BPO: Tasks such as accounting and employee recordkeeping support the business without involving customers. A provider handles this work for the client.
Some providers offer the same service across many industries, such as payroll for retailers and restaurants. Others specialize in work that requires industry knowledge, including insurance claims or healthcare administration.
What is a call center?
A call center is a team that handles a business’s phone calls. In a shared phone system, agents answer customer questions or contact people about products and services.
A business can manage the team itself or hire another company to handle its calls:
- In-house call centers: The business employs the agents and manages their work.
- Outsourced call centers: An external provider employs and supervises agents on the client’s behalf. Customers still receive help with the client’s products or services.
Call centers focus on phone conversations, while contact centers also support email, chat, messaging, and social media. An omnichannel system connects customer conversations across these channels.
For example, an agent can read an earlier chat before answering a follow-up call. The customer can then continue the conversation without explaining the problem again.
How do BPO and call centers differ?
Compare BPO and call centers below by purpose, services, management, and delivery location.
| BPO | Call Centers |
|---|---|
| Delegates business processes to an outside provider. | Organizes telephone conversations with customers or prospects. |
| Covers payroll, accounting, customer service, and other functions. | Handles billing questions, delivery inquiries, sales outreach, and other calls. |
| Assigns operational management to an external company. | Uses internal employees or an outsourced team. |
| Allows providers to deliver services domestically or overseas. | Supports callers through domestic or overseas teams. |
What is changing for BPO and call centers?
Buyers want providers who know their industry and improve services without simply hiring more people. Meanwhile, AI gives companies another option for work they might otherwise outsource.
ISG surveyed 250 senior decision-makers at large companies with recently signed or renewed, multimillion-dollar BPO contracts. The results reflect these buyers’ experiences and expectations, not every outsourcing customer’s situation.
- Industry knowledge attracts more spending: Between 2019 and 2025, the yearly value of industry-specific BPO contracts grew 27%. Over the same period, back-office contract value fell 9%, while customer experience dropped 1%. Growth favors specialized work, such as insurance claims, even as demand for other services weakens.
- AI raises doubts about future growth: ISG tracked a 67% stock-performance decline for companies focused on BPO from the December 2022 baseline. Although profits improved, investors worried about how AI could affect their business. Falling share prices signal doubts about future earnings, not proof that a provider handles calls poorly.
- Buyers expect improvements without matching hiring: Through year-end 2027, 70% expected more provider innovation, while 40% expected additional outsourced staff. In other words, buyers want better tools and processes to support more work without an equal increase in employees.
- Meeting targets doesn’t always solve problems: Even when providers meet service-level agreements (SLAs), 52% of buyers still reported operational issues. These agreements set service targets, such as how quickly agents answer calls. A fast answer alone doesn’t mean the customer got help.
- Internal AI increases outsourcing competition: Across the survey, 36% actively sought to bring work AI could handle back in-house. Healthcare and life sciences led at 47%, so interest varied by industry. Providers therefore compete with clients’ own technology and other vendors. Interest in bringing work in-house does not confirm completed changes or job losses.
How does a BPO call center work?
A BPO call center combines the outsourcing arrangement with the people and systems that deliver telephone service.
The provider hires and trains agents to follow the client’s rules. Customers speak with that team about the business they called, even though another company employs the agents.
The contract sets the service requirements, while the provider manages the daily work:
- Service boundaries: Both companies agree on operating hours and the calls agents will handle. Within those limits, the client decides which records staff may access and which decisions require approval.
- Agent preparation: Training explains the client’s products and policies so staff can answer questions accurately. To cover busy periods, supervisors schedule enough agents for expected call volumes.
- Phone systems and records: Software routes incoming calls to available agents, while outbound staff contact customers according to the client’s campaign rules. In customer relationship management (CRM) software, agents check account details and record each call.
- Requests needing approval: If a request exceeds an agent’s authority, a supervisor or the client’s team takes over. For example, explaining a bill may fall within the role, but approving a disputed refund may require a manager.
- Service checks: Managers review conversations and reports to spot mistakes or gaps in training. While the provider supervises agents, the client still reviews how well the service meets its requirements.
What services do BPO call centers provide?
BPO call centers provide inbound, outbound, and blended services.
| Service Type | What Agents Handle |
|---|---|
| Inbound services | Answer customer-initiated calls for billing assistance, product questions, order placement, and technical troubleshooting. |
| Escalate requests beyond their authority to specialists. | |
| Outbound services | Initiate calls to schedule appointments, conduct sales outreach, follow up, and run surveys. |
| Record results against campaign goals, such as confirmed bookings or completed sales. | |
| Blended operations | Combine incoming support calls with outgoing outreach as demand changes. |
| Contact customers during quieter periods while maintaining capacity for incoming requests. |
How should BPO call centers manage AI?
BPO call centers should set limits on AI decisions and make it easy for staff to take over. Regular testing and a named person responsible for errors help enforce these limits.
- Decide what AI can do: List tasks the tool can handle alone, such as drafting call notes or directing calls. For refunds or account changes, require approval from someone with the right authority.
- Connect callers with staff: Send sensitive complaints and requests outside the tool’s approved tasks to a trained agent. Include the conversation history so customers do not have to explain everything again.
- Protect customer records: Give AI access only to the information its task needs. In the vendor agreement, specify how long it stores data and if it may reuse that information.
- Check answers after updates: Test sample calls against the client’s current policies, including cases where AI should hand over to staff. If an update causes errors beyond agreed limits, pause the affected task until the team fixes it.
- Put someone in charge: Name a person who investigates errors and approves changes to the tool. Alongside response speed, track incorrect answers and successful transfers to staff so faster calls do not hide unresolved problems.
Frequently asked questions on BPO and call center
Check these FAQs for details on BPO call center costs, small-business options, missed-call coverage, and cancellation terms.
Why do businesses choose to work with BPO call centers?
Businesses choose BPO call centers for extra phone coverage without hiring and managing an internal team. The provider supplies trained agents and phone systems, while the business sets service requirements. Outsourcing may lower costs, but savings depend on the workload and contract fees.
How much does hiring a BPO call center cost?
A BPO call center has no fixed price because staffing costs depend on call volume and coverage hours. Setup fees and agent training may increase the initial bill, while minimum monthly charges apply if the contract requires them. An itemized quote shows which fees the provider includes and which it charges separately.
Can a small business use a BPO call center?
Yes, small businesses can hire BPO call centers for customer support or after-hours calls. The provider’s minimum call volume and monthly charges determine if its package fits a smaller operation. A business with few calls may pay for more coverage than it needs if the contract sets a high minimum.
Can a BPO call center answer only calls my staff miss?
Yes, if the provider offers overflow coverage and the phone system supports call forwarding. Internal staff answers first, and the system forwards calls after a set wait time or when all lines are busy. The external team then handles these calls under the business’s service rules.
Can I cancel a BPO call center contract if the service disappoints?
Cancellation depends on the contract’s notice requirements and early exit fees. If the provider misses agreed service targets, the contract may require time to fix problems before cancellation. Poor service alone does not guarantee an immediate exit without charges.
Conclusion
Outsourcing customer calls can help a business answer more inquiries without pulling staff away from their other work. Give the BPO call center approved answers to common questions and name an internal contact for requests that need approval.
You must also agree on who returns missed calls and how soon customers should hear back. With defined responsibilities, the external team can help callers while internal staff handles processes and requests that need their attention.
For Businesses With More Calls and Unfinished Back-Office Work
A billing question needs more than a phone conversation if the account record still shows the wrong charge. After the call, someone must correct the record and confirm the change with the customer.
Managed customer contact and back-office teams give businesses extra capacity for calls and the administrative work that follows. This defined service scope helps internal staff focus on approvals while the provider handles agreed tasks.
First published January 30, 2019; Updated October 28, 2026
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