Outsourcing refers to contracting non core activities of on organization to a third party while keep focused on core activities of the business. In other words outsourcing is where company chooses external suppliers to carry put non secondary activities of a business. The contractor is a person who specialized in the specific task and will be performing at low cost while maintaining high quality. As an example cleaning and catering tasks of business organizations are outsourced to specialized cleaning service providers and professional caters. Business process outsourcing (BPO) has become a buzz word in the modern business era where outsourced customer care centers/call centers connect people globally.
Factors to be Considered When Making Outsourcing Decision
If the task requires high degree of technical knowledge and specialized labour it is advisable to outsource the task to specialized firm who hold necessary technical skills.
If the task has to be completed quickly to meet deadlines it is advisable to outsource as it specialized firm hold skilled labour to complete the task in a shorter time period.
If the task involves highly sensitive and confidential information it is advisable to perform the task in house as outsourcing may lead to leaking of information.
If the task is involved with high level of risk it is advisable to outsource as specialized firms are well experienced in handling Millard type of risks.
If the task expects to be completed with a high degree of professionalism it is advisable to outsource the task as specialized firms provide services in professional manner.
Advantages of Outsourcing
Disadvantages of Outsourcing