Decision to outsource

Invisible Member Joined: 18 Jun 2007 Posts: 0

Apparently, many arguments for and against outsourcing are put forward and it will continue to go on for a while. Meanwhile outsourcing will continue to grow though it will take a while to mature, but it's a logical decision to the current global market and economic situation.

Too many companies have internal IT staff when their core competencies and business model have nothing to do with IT or in perfecting their IT. Staff may be underutilized or over utilized or even maybe unmotivated.

Outsourcing refers to a decision to sub-contract some or all non-core processes. The main motive for outsourcing is to allow the company to invest more time, finance and human resources into core activities and building strategies, which fuel company growth.

Management need no longer justify outsourcing. In fact, they might have to justify work done internally, that could easily be outsourced.

The global market today is highly competitive and rapid changes are taking place almost every day. Every company needs to focus on improving its productivity while keeping the costs down. Therefore, a lot of tasks that use up precious time, resources and energy, needs to be outsourced. You could say that outsourcing is the need of the day. The offshore firms where the work is being outsourced are flexible, quicker, cheaper and very efficient.

Outsourcing goes a long way to help free up a firm’s capital and reduce costs. The functions or processes being outsourced range from manufacturing to customer service to software development and much more. Many of the companies that seek to outsource are in the western hemisphere and most of the outsource service providers are in the east, like India, China, and Russia.

The Indian outsource industry is growing rapidly. As the outsourcing movement gains momentum, there is also backlash against the outsource providers, as a number of white-collar jobs shift from USA and UK to offshore locations like India. Nevertheless, outsourcing to India will continue as long as the need is there in the west.