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The opening of new markets in South and Southeast Asia has seen the advent of new
businesses in the areas of global sourcing of products and services. Organizations are
increasingly focusing on working with the set of activities, which happen to be their core
competency, and are outsourcing the rest to other organizations that may or may not be within
the boundaries of their own country. India has been the germination ground for the Business
Process Outsourcing (BPO) business and many global organizations have tapped the country¶s
ample human capital to effectively outsource critical business functions. The variety of
processes within each one of the functional domains has triggered of increased interest in
capturing best practices, processes and learning from each project that is outsourced. This is
aimed at saving time, money and effort while training and setting up similar processes or
ramping up an existing process / project. This has led to an increased interest in the
Knowledge Management (KM) discipline, which deals with leveraging existing knowledge,
capturing tacit elements and preserving knowledge assets for use in the future. It also
promotes an organizational culture of sharing processes and learning within the organization.
Though the initiatives may be implicit and not necessarily be known as Knowledge
Management in all organizations, it is present in some form or the other.

µµ One can see the impact of knowledge management everywhere but in the KM technology-performance statistics. ¶¶
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Trends and surveys indicate that all organizations have begun to realize the
importance of KM. However, most of them face the challenge in collating and
assimilating all information and experiences, which may, in the case of some
organizations, be spread across geographical boundaries. Even if knowledge is
captured, getting people to contribute and utilize stored knowledge assets is a
challenge. With these come further challenges, which are precipitated either because
people are not aware of the involved technology or are not cognizant of the benefits of
such an exercise.

However, if these challenges are taken care of a lot of benefits emerge for
organizations as a whole. A robust KM system leads to development of service
intensity, better quality of work and culture, globalization and uniformity of processes
across the organization, shortening of product life cycles, and removal of redundant
processes. This in turn leads to faster services/ products to market, employee
retention, valuable knowledge asset creation, innovation and idea generation, reduced
costs, and effective delivery of organizational goals to employees.
This paper looks at the concept of Knowledge Management in the context of the BPO
industry and captures in essence the challenges and the opportunities that might arise
while implementing a KM system in a BPO environment.

µµ One can see the impact of knowledge management everywhere but in the KM technology-performance statistics. ¶¶
 ireating a ³Knowledge ± friendly´ work culture is difficult if it is not intrinsic to the culture because it
involves selling an elaborate plan for change management to the organizations¶ leadership. Likewise, a
few of the other challenges that are faced by organizations can be enumerated as under:

1. Absence of knowledge systems that can capture tacit elements of knowledge from existing set of
employees.

2. Absence of a continuous learning i.e. a learning organizational culture.

3. Lack of sharing of best practices across various departments, and upgradation of best practices with
change in processes.

4. Lack of openness and inadequate dissemination of information between different stakeholders in the
knowledge capture and storage process.

5. Employee reluctance to share information amongst themselves.

6. Lack of avenues for searching knowledge sources and lack of mechanisms for constituting communities of
practice.

7. Lack of motivation in the employees to accept and incorporate industry best practices into their operations.

8. Loss of knowledge when people move across departments as part of changes in job roles.

9. Lack of understanding of the company¶s business goals, models , and strategies.

10. Lack of understanding of metric measures and the Knowledge Management program
 In the context of these challenges, there are many opportunities that Knowledge Organizations have,
over other organizations. A few can be enumerated as follows:

1. Provision of the right knowledge at the right time for any user that wants it.

2. A repository of all knowledge items where all knowledge assets can be collected and stored.

3. Effortless handling of routine and simple tasks simply by sharing best practices

4. Increased innovation and spread of ideas in process

5. iomplex and unexpected tasks will be handled competently making effective use of past experiences in
the same kind of tasks

6. iosts of training and building learning assets are lowered after the knowledge repository is in place.

7. Employee retention is enhanced as employees are recognized for their contribution to repositories and
recognized in the performance management process

8. Operations get further streamlined by sharing of best practices and redundant processes can be done
away with.