05 Nov 2012 Comments Off
These days, with stiff competition particularly in the business field, a lot of organizations could not handle all aspects of a business process internally, thus the need for offshore outsourcing services. Why offshore? Because it is relatively cheaper and you could get things done faster and in the most effective manner. Once a task is being outsourced to an offshore service provider, it becomes the responsibility of the service provider.
Nevertheless, before you make any move towards offshore outsourcing services, it is of vital importance to understand the pros and cons and weigh your option carefully. While outsourcing offers various benefits to your company, it could also pose hardships if you are not able to outsource to the right service provider. Some of the most commonly outsourced business streams include legal outsourcing, IT outsourcing, recruitment, content development, web design and maintenance, logistics, technical/customer support and manufacturing.
Many companies turn to offshore outsourcing services for the following reasons. The reasons may include the lack of expert-labor in some parts of the business process, availability of cheap labor without compromising quality and the ability to focus on other important business functions.
PROS OF OFFSHORE OUTSOURCING SERVICES
1. Expertise and Swiftness. Offshore outsourcing vendors have certain technical expertise and equipment that make the task faster and easier.
2. Risk-sharing allows certain responsibilities to be shouldered by the outsourcing vendor. Because the outsourcing company is a specialist, they will be able to plan your risk-mitigating factor much better.
3. When you outsource, you can have more time to concentrate on your core competencies. This provides you more time to strengthen your core business tasks.
4. Minimized recruitment and operational costs since outsourcing eludes the necessity to hire people in-house, thus operational and recruitment costs would de minimized to a great extent.
5. Cost savings advantage since companies will be able to reduce employee levels and other related costs, like supervision, recruitment, benefits and salary.
CONS OF OFFSHORE OUTSOURCING SERVICES
1. There is the risk of exposing confidential information, particularly when outsourcing recruitment and payroll services. It includes risk of exposing a company’s confidential data to a third party.
2. There may be hidden costs despite its being cost effective. There could be costs that are unknown in signing a contract across international boundaries.
3. There could be stretched delivery time frames, inappropriate responsibility categorization and sub-standard output quality.
4. Lack of customer focus since the outsourcing vendor could be catering to numerous organizations at the same time.
With these pros and cons when you decide to outsource services to another country, it is always advisable to determine specifically the importance of the tasks you want to be outsourced. It is always a good idea to consider the pros and cons before you actually do it. Because of the stiff competition in today’s economy, a business should be more vigilant when it comes to saving costs and high quality to ensure profitability. Offshore outsourcing is a wonderful option that has helped a lot of companies throughout the world for many years now. The key to effective outsourcing services is to determine your exact goals and the advantages of outsourcing for your company should outweigh the disadvantages.