Back Office Functions –Those business processes such as finance & accounting, administration, procurement, payroll, benefits, HR, IT, marketing, and legal.

Benchmarking – A study in which components of a company’s contracted services, such as price, service levels and terms & conditions are compared to those of peer companies

BPO – Business Process Outsourcing. The transfer of internal business processes, such as CRM, Finance & Accounting, HR and Procurement, to an external provider who improves these processes and administers these functions to an agreed service standard and at a reduced cost.

ITO – Information Technology Outsourcing. The transfer of internal non-core information technology processes, such as infrastructure, applications development and maintenance, end-user computing, help desk and network and mainframe servers, to an external provider who improves these processes and administers these functions to an agreed service standard and at a reduced cost.

KPO - Knowledge Process outsourcing. KPO is the offshoring of knowledge-intensive business processes that require significant domain expertise to an external provider.

Near-shore Outsourcing – The transfer of business or IT processes to companies in a nearby country, often sharing a border with your own country. This term is often used in with the United States as the frame of reference, in this case, near-shore outsourcing will take place in either Canada or Mexico.

Offshore Outsourcing – The transfer of business or IT processes, such as bill processing, customer service, insurance claims, payroll, software programming, etc., to countries outside the parent company’s country, such as India, China, the Philippines, etc., in order to help reduce costs, gain competitive advantages and enhance business performance.

Onshore Outsourcing – The process of engaging another company within your same country for BPO or ITO services. Much of the current jargon is based from the reference point of the United States. Thus, onshore outsourcing typically means contracting a United States company to provide business services.

Outsourcing – The process of transferring business processes to an external service provider, who then becomes accountable for those services.

Shared Services – The consolidating of service functions, such as accounting, benefits, HR, IT, marketing, legal, logistics, payroll and procurement, within an organization through the merging of separate activities into one function that crosses business units.

Sourcing – The process of contracting with a third party for products or services rather than providing those products or services with captive resources.