What is Outsourcing?
Outsourcing is the contracting out of a organization's non core, nonrevenue-producing activities to specialists. It differs from contracting in that outsourcing is a strategic management tool that involves the restructuring of an organization around what it does best - its core competencies. Two common types of outsourcing are Information Technology (IT) outsourcing and Business Process Outsourcing (BPO). BPO includes outsourcing related to accounting, HR, benefits, payroll, and finance functions and activities.
Outsourcing, HR, benefits, and payroll administration is a strategy that allows you to redirect the management of administrative tasks in order to focus on what matters: your organization's primary business objectives. By leveraging the experience of a dedicated provider, you benefit from enhanced service delivery, access to superior technology, and reduced costs.
Top 10 reasons why companies outsource:
- Reduce and control operating costs
- Improve company focus
- Gain access to world-class capabilities
- Free internal resources for other purposes
- Gain access to resources that are not available internally
- Accelerate reengineering benefits
- Handle functions that are difficult to manage or are out of control
- Make capital funds available
- Share risks
- Bring in a cash infusion
Source:The Outsourcing Institute
Tips for Outsourcing