Outsourcing has become a key trend in industries these days. Companies often outsource so that they can achieve few vital objectives. Outsourcing, it is said will have a good going in the current year and it is also anticipated that it will enhance the efficiency as well as effectiveness of a company.
Outsourcing is a process by, which some of the day to day activities performed by one company is entrusted to some other company, who takes responsibility to perform the same activity. In other words, it is the transfer of a "business function" to another company. In this there is transfer of assets as well as people.
Prior to transferring responsibility to the other company(taking over the responsibility), the company giving the contract used to carry on the same activities all by itself(in-house).
Some of the areas, which are outsourced include:
- Business analysis
- Servicing of workstations as well as networks.
The range of outsourcing is varied. It may include large outsourcing contracts as well as small outsourcing contracts. For example, Xerox has outsourced its IT (Information Technology) division to IBM (International Business Machines).
Reasons for which outsourcing is carried out:
There are many reasons for outsourcing. Some of the reasons are given here under:
- Restructuring costs.
- Reducing expenses
- Enhancing knowledge
- Efficient marketing strategies
- Improving quality of services
- Com modification
- Managing risks efficiently
Trends to look forward to in outsourcing in 2008:
As per reports published by the International Association of Outsourcing Professionals or IAOP, the following trends are being anticipated this year. They are:
The value of outsourcing will be increasingly recognized as adding value to the lives of innumerable people around the globe. The companies, which extend, advise as well as use outsourcing, are anticipated to comply with the "highest ethical standards". Outsourcing is expected to expand job opportunities, train employees, improve the environment and contribute to the communities in a varied manner.