Outsourcing is the hiring of another company, or private contractor, to perform an existing task or newly required task for a company. Business process outsourcing to another entity is normally performed in order to save money, or to save time. This approach to business is almost as old as business itself, but the types of outsourcing have evolved, as has how we do business.
A clear example of this is IT services outsourcing. This is often performed by companies, due to the area of IT being a very specialist field, but one that all to often isn’t required one hundred percent of the time. Hence, for both real world and online companies, outsourcing IT processes can prove to be a very beneficial arrangement.
Furthermore, offshore outsourcing has also become a popular method of both reducing costs and avoiding tricky ‘red-tape’ areas in the specific business’s base country. The reason for this is that countries vary dramatically regarding laws, costs and salaries. This means that by moving certain aspects of a business to an overseas company or contractor, it is possible to simplify things and reduce costs. A simple example may be where complicated licensing is required in the home country for a certain task. This license could be difficult and expensive to gain, while employing the qualifying staff members also increases bills. In this case, the company may choose to take advantage of offshore outsourcing services.
For more details on the benefits, check out our page on the Benefits of Outsourcing.