Have you ever been wondering why companies develop outsourcing?

I am positive that you already heard term “outsourcing”. It starts to be more and more common. Very often people know intuitively what it means, but cannot explain it if somebody asks. Plenty of people, that I have met, don’t also understand why firms are so interested in this.

Prepared by: Maciek Lulko
Oryginal: http://www.flickr.com

I have often been asked the following question – why would enterprises pay for any external enterprise to do something that they can do by themselves? I have to admit that this logic might seem to have sense – if external company can earn money on doing something for us, why can’t our firm do this by themselves?

I will do my best to explain that on the following example. Imagine for a while that you own a enterprise which invents and creates new mobile phones. You are thinking about outsourcing managed services- see more details. Consequently, you are looking for a rewarding enterprise that works in the field of mobile app development- check the facts. What would your firm gain if you decide to do that?

Firstly, you would reduce costs. Developing new complex producst would require employing lots of specialists which are really expensive as employees. It may be much more beneficial to posses to outsource an external firm which specialises in that field and already owns experienced staff. As a result of, that is very likely to be less expensive to outsource an external company, than to have proffesionals within the structure of your enterprise. This is one of relevant factor that makes companies use outsourcing. The central aim is cost cut. Apparently, not the only one.

However, firms may lower labor costs also by outsourcing services from an external company that is based in the foreign country. Certainly, it has to be country that has very well qualified people but cheaper cost labor at the same time. I believe India is the best example of such country which is especially trendy in such services.

Finally, outsourcign enables to increase the quality of services. For instance, if you agree that mobile app development would be created by outsourced company which specialised solely on this area, this will be definitely more successful than if it were developed by our employees who are not specialised in that narrow field of expertise.

Posted by Administrator on 2019-03-18 00:51:36
Tags: company, area, labor