What is back-office? Back office refers to those jobs which are not strategic in nature, but require great amount of knowledge and skills. These are tactical in nature and earn no revenues, but form critical part of a business firm for providing customer satisfaction. Robert Reich has divided workers in to three categories - production workers, routine service workers, and symbolic analysts. Back-office work is concerned with these workers who are creative workers in the field of law, engineering, medicine, accounting, banking, entertainment, architecture, design, etc.

Someone has very rightly commented that China is the back-office of the world manufacturing, and India is the back-office of world services. In its true sense back-office outsourcing is concerned with services only.

Why can't a company perform all its services itself? The reasons are so many. One is that competition is forcing them to get these services from a location which is cheaper than in-house. According to an estimate back-office outsourcing enables onshore firms to cut their costs by 50 to 60 %. Second, by back-office outsourcing they would be able to concentrate upon their core functions.

Third, delivery time is shortened because of two reasons - one, for the offshore firm this is their business, and two, because of a different geographic location (there is a time gap of around ten and a half hours between the US and India. By the time it is the end of the day in the US, it is the beginning of the business hours in India). Fourth, through back-office outsourcing they will be able to make productivity gains, and last but not the least, they would be able to satisfy all their stakeholders.

Back-office outsourcing is different from contracting. Back-office not only manages the outsourced processes but improves and reengineers them by corking in close touch with the clients in order to provide tailor-made solutions. Back-office outsourcing can provide services as simple as answering queries with regard to account details, maintenance, product information to complex services such as procedure and infrastructure designing to manage inbound calls.

India is the back-office of the world because of its skilled, and inexpensive talent. It is because of this reason that the US majors such as IBM and Accenture have established their offshore back-offices in India.

Presently the scope of services rendered by back-office include financial and accounting services, software development, call centers, maintenance of site development, medical and legal transcription, medical advisory, etc.