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Insights: Article

Outsourcing: What can it do for me and my business?

By   Scott Kost

December 10, 2014

Outsourcing is making a business decision to contract with an outside service provider for a particular service or business process. A common misconception about outsourcing is that the primary goal is to reduce operational costs. While outsourcing does frequently reduce spending, there are often more important and strategic benefits to be realized.

Delivering Value
As with any business expense, the primary question business owners and leaders should be asking is: “What business value are we getting from our spending?” The business value that can be delivered through outsourcing can come in many forms, including the following:

  • Improved Performance – High-quality outsourcing providers have established processes and technical tools that they deploy across all of their clients. These processes and tools will contribute to improved system performance and stability for each client’s needs.
  • Team Skills – Leading outsourcing service providers have assembled a full team of skilled resources that many organizations cannot easily replicate. By outsourcing some or all of your operations/services, you gain access to these resources on an as-needed basis.
  • Higher Level of Service – As your business needs change, having a strong outsourcing partner provides you with flexibility to quickly grow or adjust your capabilities to meet your business needs.
  • Reduced Cost – Many businesses do not have the need for full-time staff in a particular area of their business. Partnering with an outsourcing provider can often provide you with a lower-cost alternative to hiring internal full-time staff for these functions.


Options & Expertise

In today’s business climate, there are options available for outsourcing in nearly all aspects of your business operations. In addition, outsourcing service providers typically offer several levels of services—from outsourcing a simple task to more complete business process outsourcing offerings. The following diagram highlights several of the most common types of outsourcing services: