Getting started with Outsourcing
Outsourcing is a very broad topic that involves several options and models. On the global perspective, outsourcing has become a fact of life and it’s growing quickly despite the supercharged politics surrounding the issue. The globalization of outsourcing operating models has resulted in new terms such as onshoring, nearshoring and rightshoring that reflect the changing mix of locations.
In the Philippine setting, local companies from small to large enterprises are becoming more responsive to the outsourcing arena and adopting it in their organizations to focus more on their core business. Companies are generally outsourcing their information technology and some of the back office operations such as Research & Development, Accounting and Recruitment, etc. These are commonly known as Knowledge Process Outsourcing (KPO) and Business Process Outsourcing (BPO) in the industry.
What is outsourcing?
As Wikipedia defined it, outsourcing involves the transfer of the management and/or day-to-day execution of an entire business function to an external service provider. The client organization and the supplier enter into a contractual agreement that defines the transferred services. Under the agreement the supplier acquires the means of production in the form of a transfer of people, assets and other resources from the client. The client agrees to procure the services from the supplier for the term of the contract.
What are the areas that being outsourced?
Companies' business segments that are typically outsourced include information technology, human resources, facilities, real estate management, and accounting. Many companies also outsource customer support and call center functions like telemarketing, cad drafting, customer service, market research, manufacturing, designing, web development, content writing and engineering.
Information Technology Outsourcing
Information technology outsourcing is one of the major areas that companies normally outsource. In the area of Information Technology, companies are outsourcing their technical support services such as the management and maintenance of their Desktop, Network, databases and Servers. Helpdesk management operation is sometimes bundled with technical support services or it was being outsourced separately. Web Development and customized software development are also included in the IT outsourcing bandwagon.
Why outsource IT?
There are several reasons why companies consider outsourcing as an alternative to setting-up and maintaining in-house IT support.
One of the major reasons is the complexity and cost associated to sustaining this area of the business. The investment of training people, building infrastructure and maintenance are the major drivers of outsourcing.
Competent IT professionals are very hard to find these days especially in the Philippines that the experienced IT engineers are migrating to other countries because of lucrative packages. This lead then for companies not to have the skills needed to fully utilize potentials of their IT and this typical setting hamper the efficiency and productivity of the entire organization.
If properly delegated to the right outsourcing providers, companies can reap the full potential of outsourcing which studies says better investment, reducing cost and risk factor, access to specialize skills, and minimum capital expenditure. Outsourcing means focusing on your mission-critical projects, managing customer and partner relationships and formulating your business strategies. Allow the experts to do it for you.
By: Josie T. Arcega
July 2, 2008
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