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Subscribe to RSSOutscoring: Your business strategy
for cost saving and quality in operation
There
are a few things that you should know before deciding to outsource your
work. First you need to establish goals of outsourcing i.e. what are
you planning to achieve though outsourcing? Also you need to clearly
define the processes in your business that can be outsourced.As a basic rule, you should manage your core activities in-house while the supporting and administrative activities may be outsourced based on the cost benefit analysis. Below are some of the ways outsourcing can benefit your business. Some of the challenges and risks associated with outsourcing are also highlighted. Benefits and challenges should be vetted against these criteria before deciding to outsourced.
Costs savings
This is the most obvious benefit
of outsourcing for many. It allows the business to get the work done
for a fraction of the price. Payroll obligation costs such as health
insurance and leave pay can also be saved. Further, many entrepreneurs
choose offshore outsourcing because they receive quality at a much
lower price. It has been researched that on an average, a company can
save about 60% in operational costs with outsourcing a business process.Access to skills
Outsourcing allows you to have access to a unlimited range of skills
without having to hire someone with the required skills. Need
professional team to manage a process but you don’t have the required
professionals in-house? Outsource it!Time zone difference - Your project
makes progress while you sleep
Often the service providers live in a different timezone, your project
makes progress 24/7. It is a great feeling to wake up in the morning to
receive in your inbox an update of the work that has been done on your
project while you were sleeping.Focus on core activities
As your business grow, your core team may end up doing more
administrative and supporting tasks. Outsourcing supportive and
administrative enable your team to concentrate on core business
activities and more important functions.Also outsourcing part of the risks!
When a
business process is outsourced, the risks associated with that process
is also partly outsourced. A good example is payroll management.
Outsourcing it to a payroll service provider also means you are partly
transferring the risk of being sued for delay in payment to employees.
However, one need to keep in mind the ultimate liability for timely
wages payment reside on your business only. Improving customer service
Good customer
service is vital for success of any business. Outsourcing customer
services to overseas service provider may allows your company to offer
24 hours availably. Further, the customers queries and complains are
taken care by professionals.Workforce flexibility
If you are bootstrapping in your business, or unsure about the short /
middle term future of your business, hiring freelancers is a great way
to have access to talent, avoiding long term commitments at the same
time.Apart from benefits, one also need to keep in mind and manage risks associated with the outsourcing. Some of the risks need to consider are:
- Risks of miscommunication: Different cultural backgrounds, misread emails, absence of communication altogether all add up to put your outsourcing project at risk.
- Difficulty to find the right service provider: Because most outsourcing happens online rather than via recommendation, there is often a higher risk that the service provider may not be up for the job.
- How am I protected if something goes wrong?
- Lack of control because the service provider works remotely
Like to know more on how your business
can benefit from outsourcing? Enquire now...
