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What is Outsourcing and Why Is It Advantageous? By definition, outsourcing is the process of allocating or delegating business operations and tasks to an external service provider. It’s safe to say that the primary or original reason why outsourcing as a concept was born is because companies and large corporations realized that it wasn’t effective or efficient to handle all aspects of the business process internally. Simply put, the usual workforce inside an organization isn’t enough to perform all tasks. But aside from that, another reason why outsourcing has become quite a trend for businesses and companies is because there are processes which are temporary in nature, which means that it isn’t practical or sensible to hire full-time workers or professional to perform those tasks. Theoretically, once a specific task is outsourced, it is expected that the service provider will take the responsibility of performing it to the best of his/her ability. So, if you’re part of an organization that plans to outsource some of your business processes, it is important to know what its advantages are. 1 – Outsourcing is associated with cheaper labor.
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If you don’t know it yet, one of the most notable beneficiaries of outsourcing these days are those companies offering support services. Outsourcing support services is something that many companies in developed countries are taking full advantage right now because they can employ external services providers at substantially lower costs compared to when they hire inhouse employees doing the same job.
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2 – Have more focus on core business process. You must know that by opting for outsourced support, you’re effectively shifting your organization’s focus to the more important aspect of strengthening or developing your core business process instead. You no longer have to put that much attention to supporting ones. 3 – You get to see substantial reduction in overhead costs, too. Another advantage of outsourcing the usual support services and similar tasks is that you can avoid spending money on additional office space for the additional employees you expect to hire to perform those tasks. Several years back, the idea of a company embracing growth traditionally meant that the need for additional office space was imminent and imperative; but today, it doesn’t have to be that way, thanks to the option of outsourcing temporary and back office functions to external service providers. With external service providers, these people can work for you and your organization without having the need to be physically present in the office and use up space.