Outsourcing does not just save cost. The key reason is flexibility, both in terms of pricing and speed of change. Many outsourced processes are priced according to the volume of work carried out – ie companies pay a variable cost. If an organization has to employ people in-house for such tasks, it has to pay a fixed cost (salaries and overheads). With outsourcing, the cost is related to the volume of work. Benefits of this flexibility are that the price for an overseas third party managing the process is less than at home and they are likely to have considerable expertise in this skill set. The organization saves on maintaining a specific, perhaps costly, skill set and the outsourced model permits rapid changes in output as the responsibility for staff changes passes to the outsourced provider. Known costs also help with internal budgeting.
When outsourcing their processes, organizations can then focus on their core competences or whatever defines their competitive edge (often technological or operational excellence). Outsourcing also enables organizations to be more entrepreneurial, without bureaucratic limitations involving processes far removed from its core business strength.
Shrewd businesses outsource several elements of their processes, thereby concentrating on whatever they do best. This has led to nimble organizations operating within tight domestic head-counts and punching above their weight. And an organization’s clients are none the wiser to who provides the service as they are often white labelled.
The Business Outsourcing Company will be pleased to discuss your requirements with you and to explain how we can add value to your organization. For more details – contact us.