Outsourcing is the process of delegating a company’s business process
to third parties or external agencies, leveraging benefits ranging from low
cost labor, improved quality to product and service innovation. When
outsourcing transgresses national boundaries and is managed by companies
located in other countries, outsourcing takes the form of offshoring.
A hotly debated topic with pros and cons, both outsourcing as well as
offshoring have a direct impact on a company’s top and bottom line and have
become key components of defining how successful enterprises are run. Given
below, as reflected by companies, are the top 10 reasons to outsource:
1.
Lower operational
and labor costs are among the primary reasons why companies choose to
outsource. When properly executed it has a defining impact on a company’s
revenue recognition and can deliver significant savings.
2.
Companies also
choose to outsource or offshore so that they may continue focusing on their
core business processes while delegating mundane time consuming processes to
external agencies.
3.
Outsourcing and
offshoring also enable companies to tap in to and leverage a global knowledge
base, having access to world class capabilities.
4.
Freeing up internal
resources that could be put in to effective use for other purposes is also one
of the primary benefits realized when companies outsource or offshore.
5.
Many times stranded
with internal resource crunches, many world class enterprises outsource to gain
access to resources not available internally.
6.
Outsourcing, many a
time is undertaken to save costs and provide a buffer capital fund to companies
that could be leveraged in a manner that best profits the company.
7.
By delegating
responsibilities to external agencies companies can wash their hands off
functions that are difficult to manage and control while still realizing their
benefits.
8.
Outsourcing andespecially offshoring helps companies mitigate risk and is also among the
primary reasons embarked upon.
9.
Outsourcing also
enables companies to realize the benefits of re-engineering.
10.
Some companies also
outsource to help them expand and gain access to new market areas, by taking
the point of production or service delivery closer to their end users.
Comments
Post a Comment