Outsourcing is classified as a process of delegating or allocating highly specific business processes to an external service provider, who generally is considered an expert of a specific industry or niche. Perhaps the main reason why outsourcing was invented in the first place is because there was a time when companies and businesses figured out that taking care of all aspects of the business process was something too challenging or difficult to perform or handle internally. In other words, the number of workers or maybe their abilities aren’t sufficient to cover all essential tasks. Another notable reason why outsourcing has become a practical alternative for many businesses and companies today is because there are some tasks or processes that are temporary in nature; as such, it wouldn’t make a lot of sense to hire full-time or inhouse professionals to handle them.
Theoretically, once a specific task is outsourced, it is expected that the service provider will take the responsibility of performing it to the best of his/her ability. Being the manager or decision maker of your organization, you need to fully understand what the advantages of outsourcing are, especially if you plan on using this approach one of these days.
1 – Outsourcing is usually linked to cheaper labor.
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It’s no longer a secret that one of the most prominent recipients of outsourcing today are companies offering support services. Outsourcing support services makes a lot of sense especially for large companies in industrialized countries because they get to pay external service providers from other countries in Asia and Africa with lower rates compared to how much they expect to pay for regular inhouse employees in their own countries.
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2 – Companies get an opportunity to focus more on core business processes.
If you prefer outsourced support for your company, it means you can now focus more on developing or improving your core business processes. As such, you won’t be spending a lot of your time, resources, and money on supporting ones.
3 – Significant reduction of overhead costs.
By outsourcing some of the support services or other tasks that you normally will delegate to employees who you pay full-time and who occupy office space, you can instead outsource them so that you no longer have to top dollar merely for office maintenance. In the past, a company’s growth usually meant having to accept the need for additional office space, but that’s no longer the case because of the benefit of outsourcing. By taking advantage of external service providers, you can avoid spending additional money on expanding and adding office space because you don’t have to in the first place.