Why Businesses should Outsource this Year
by: Sarah Joson
Friday, February 17, 2012
Category: Outsourcing News
In today’s economy, one of the known revenue generators is outsourcing. It is the process that businesses used to combat the effects of the economic downturn that happened not too long ago.
In an article published at SupplyChainDigital.com, IT services and business consultancy firm Capgemini explains that aside from cutting costs, there are 10 more reasons companies should consider outsourcing.
It can expand your business’ coverage. Because companies are now also trying the offshore outsourcing setup where they acquire the services of a provider or establish a captive overseas, they have also increased their customer reach and are now able to segment their processes properly.
Control over ongoing and capital costs. Outsourcing also allows businesses to have more control in allocating their budget, as initial investments or capital costs can now be transformed into an ongoing cost.
System upgrades or restructuring? CIOs can now use different variations of technology services like Infrastructure as a Service (IaaS), Business Process as a Service (BpaaS), and Software as a Service (SaaS) instead of constantly reconstructing the core operating system of the company.
What you see is what you get. Along with business level agreements, providers now have a fixed metric so that buyers know what to expect. This eliminates discrepancies in contracts and can give clients a head start on how they will draw their strategy.
Labor fees are lower. Whether we like it or not, the cost of labor in other countries for high-end services is still lower than the local rate, which is probably why businesses outsource in the first place.
More control over the entire operation. As the company expands, more and more processes are overlooked and become redundant, causing losses to the company and inferior quality of output. Outsourcing enables companies to centralize control over the entire operation and rule out the unnecessary steps that cost money and time.
Outsourcing can help businesses meet the standards. Trying to keep the operation up to par will cost business owners money and time. A credible provider, one that has quite the experience in streamlining business processes for companies, can help reassure businesses that they can achieve, monitor, and maintain standards according to the industry’s requirements. Companies can also choose to outsource only the basic processes instead of sharing sensitive internal information.
It can ignite a business’ capability to grow. Outsourcing offers several business frameworks, enabling companies to expand and maximize their potential.
Increase options for resources. Having an outsourcing operation overseas makes it easier for management to gain access to the fresh talent pool and compete with other global players in the industry. It can also reinforce merger acquisition plans and help fill open positions.
Providers can take care of the basic stuff. Outsourcing companies can take on the processes that are usually considered as additional tasks by the client, providing all the necessary tools and management skills that can help executives focus on their core processes.