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Why Outsource

Outsourcing is the process of delegating a company’s business process to third parties or external agencies, leveraging benefits ranging from low cost labor and improved quality to product and service innovation.

Outsourcing can have direct impact on a company’s top and bottom line and become a key component of defining how successful enterprises have run. Given below 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 outsourcing has a defining impact on a company’s revenue recognition and can deliver significant savings.
  2. Companies choose to outsource so that they may continue focusing on their core business processes while delegating mundane time consuming processes to external agencies.
  3. Outsourcing also enable companies to tap into 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 another primary benefit realized when companies outsource.
  5. World class enterprises outsource to gain access to resources not available internally to reduce internal resource crunches.
  6. Outsourcing 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 of functions that are difficult to manage and control while still realizing their benefits.
  8. Outsourcing helps companies mitigate risks and is a primary reason that it is utilized.
  9. Outsourcing enables companies to realize the benefits of re-engineering.
  10. Some companies outsource to help expand and gain access to new market areas by taking the point of production or service delivery closer to their end users.
  • To summarize, companies undertake outsourcing for a variety of reasons depending upon the vision and purpose of the exercise. While this may vary from company to company, the fruits of labor are visible among some of the leading enterprises worldwide, where in outsourcing has become a core component of day-to-day business strategies.