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Outsourcing Pros and Cons: A quick look

outsourcing pros and cons

Outsourcing, in itself, is a big term that is quite prevalent nowadays. Started as a tactic that was used to cut the operational expense of the big enterprises, outsourcing has now accomplished a special place in the business industry. It is no longer a choice but essentiality with small and medium businesses actively looking to outsource their tasks to competent service providers.

The debate still persists. Outsourcing with a long-tail of benefits is a lot of corporates’ favorites but not all are happy with its experience. Like a coin, outsourcing also has two sides. With merits, there also exist disadvantages that are stick with outsourcing.

Today, we are hence, going to discuss both the white and black side of outsourcing:

The Pros

All the big corporations and most of the SMBs are today outsourcing one or more of their business functions to the specialized service providers located in the offshore locations. Why? Of course, there are various benefits that are associated with outsourcing. These are:

The cost-benefit

This the most common reason. Outsourcing offers you to trim the operational expense to one-third at least, making it a viable and extremely essential strategy for the business. For example, a customer service provider will only charge you for the hours of assistance it provides. You do not require to pay for the infrastructure, tools, the technology, and agents’ hiring & training that you would have to if you wanted to do the customer service on your own.

Focus on core competencies

Companies that try to handle extraneous yet necessary back-office, front-office and web-enabled tasks on their own often have to face the issue of curtailed efficiency or downed performance. This is so because the business owners and professionals generally get involved so much in handling departments like customer service, accounting, HR, call answering, telemarketing, etc that their attention gets diverted from the tasks that impact the revenue generation directly. Outsourcing offers the comfort to get the focus fixed on the core competencies as the other tasks are effectively handled by the specialized service providers.

Access to competent staff

Outsourcing also offers you a chance to get trained and experienced professionals ready at your disposal. This provides your business an edge over the competitors.

The Cons

There are some disadvantages related to outsourcing that often makes the business owners doubtful about this business strategy. These are:

Loss of control

Businesses often have to share a lot of detail about the tasks to be outsourced, which develops a kind of fear and agitation in the minds of owners about this approach. Outsourcing means you are handing over the operation of a business task to an external company, which may also lead to loss of control on that particular function.

Quality issue

A lot of companies have reported that their experience with outsourcing was below-par because the level of service offered didn’t match the expected bar. This happens because not all the outsourcing companies are competent enough to handle your business tasks. So, when you choose your outsourcing partner, make sure to check its experience and market repute to avoid this issue. These are some of the outsourcing pros and cons that persist in the market. For more, stay tuned.

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