Glossary of terms

This glossary is intended to assist you in getting a general understanding of commonly used terms and concepts when dealing with outsourcing and outsourcing governance. We welcome your contribution to further improve and expand the glossary.

# A B C D E F G H I J K L M N O P Q R S T U V W X Y Z
There are currently 6 names in this directory beginning with the letter K.
Key Performance Indicator (KPI)
Key Performance Indicators, or KPIs, are a tool businesses use to measure just how effective they are achieving their objectives. (see also outsourcing objectives) Using KPIs is a way for a company to quantify their business objectives so they can regularly check up on their performance and determine whre they are successful and where they need to improve.

Most KPIs fall into one of the following four categories:
• Revenue improvement
• Cost reduction
• Process cycle-time improvement
• Increased customer satisfaction

For a KPI to be effective, it has to meet the following criteria:
• It has to be clearly aligned to business services or associated risks
• It has to echo organizational (business leaders) goals
• It creates meaning on all organizational levels
• It has to have contractual implications
• It is achievable and easy to understand
• It is measurable based on ligitimate data
• It is actionable and can be changed when needed

Key Performance Indicator means that they have to represent “wildly important” priorities. This priority can be based on the value of a service outcome or the risk associated with it. If they are anything less they are just distractions that blur the focus and clutter the processes at every level of the organization. To get the biggest payback the number of KPI's should be limited to 3 to 7 and focus on the biggest value drivers and/or biggest risks to value. As with any priority in an organization also the set of KPI's can change, driven by a changing riks profile, supplier performance or business priorities.

The following are KPI examples for gauging business performance:
• service availability
• service utilization
• service cost per user
• spend on under-performing services
• invoice accuracy
• number of escalations
• number of customer complaints
• cycle time from request to delivery
• number of incidents
• number of service disruptions from IT changes
• number of service improvement initiatives

Key Personnel
List of employees that are critical to the account

Key Service Provider Positions
Critical positions in the service provider hierarchy in which the buyer has a say

Knowledge Process Outsourcing (KPO)
Knowledge Processing Outsourcing (popularly known as a KPO) is the combination of Business Processing Outsourcing (BPO), Research Process Outsourcing (RPO) and Analysis Proves Outsourcing (APO). KPO business entities provide typical domain-based processes, advanced analytical skills and business expertise, rather than just process expertise

Knowledge Services
Knowledge services refers to offshoring of some or all knowledge-intensive services such as business research, market research, data management, data analytics, and legal and IP support to providers

Knowledge Transfer
The task of bringing the service provider staff up to speed on internal procedures and processes. Part of the process is establishing what knowledge remains in-house and what should be transferred