“Outsourcing is pretty fashionable for modern start ups whose primary� goal is to reduce capital and increase revenue.But always outsourcing is not easy. Lot of questions needed to answer, like where to outsource, the geographical decision, and many more question”
Outsourcing is pretty much gaining popularity in modern business world. Outsourcing is basically contracting out services to third party in order to reduce cost, improved quality, shift focus on core activity. After four generation, the prime focus in fifth and sixth generation is same on cost reduction. Undoubtedly outsourcing result in reduction of total cost of project.
Pros and Cons of outsourcing
But, as every coin has two phases. Apart from tremendous pros of outsourcing, there are some cons of outsourcing. It is important to note its entirely depends on your nature of work and your requirement that which side you took. Even the cost effectiveness was measured as one of the the main advantages of outsourcing, keen observation can identify comparative benefits than cost effectiveness. When many companies identified the process of outsourcing as their main key to achieve success lines, it nourished like anything and widely adopted by all range of business organizations to find external resource to complete their business process tasks and operation management.
Here are some Pros and Cons of outsourcing to consider before taking any decision on outsourcing,
Advantages of Outsourcing
The Pros Of Outsourcing
Economic Benefits of Outsourcing
Cost Effective/Reduce cost
The prime benefit of outsourcing is that its very cost effective service. Outsourcing could result in reduction of 15-20% of total project cost.� Using foreign labor especially of south east Asia�countries like India are often cheaper than using domestic labor.� The offshore outsourcing process was mostly accepted by the business organizers who gain a lot of cost reduction in their business process and management costs. It was highly beneficial for top level business firms when they were able to buy expert services for very lowest price without providing any infrastructure facilities, establishment benefits, other anticipatory staff benefits, personal claims, medical reimbursements, insurance coverages, staff recreational affordability.
Access to Talent� ��
Leveraging the talents of others who live far away from your borders. outsourcing give benefits of utilizing part time employees in contrast to full time employee. Many developing countries have highly talented man power who are technically well equipped and educationally highly qualified cleared the successive path for outsourcing.
Time Factor�
Imagine, when your office is closed, your team is working on your projects. For instance, if you choose India for outsourcing, India time has its own advantages, while you are sleeping, your project is in progress.
Can focus On Your Core Activities� �
When you outsource your project, you need not to bother about recurring staff or to conduct training session to them. Outsourcing will let you free to focus on your core competency.
Disadvantages of Outsourcing
Cons Of Outsourcing
Delay In Project Delivery
Communication lag, miscommunication or some inaccuracy could result in the delay of delivery of project. In today’s era when time is money and even small delay in project deliver can create a big difference .
Security Issues
Security is always a matter of concern for organization. There are some sensitive data, information need to handle with extra security, sometime outsourcing the project to wrong service providers can bring disaster for organizations.
Lack Of Focus On Your Project
Quality always matter, but if when contracted staff member is working remotely, it is difficult to check the accuracy� at every stage of project. Its Become hard to monitor the activity of employees from far distant.
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