Strategic Ways To Outsource, And When To Do It

By | January 8, 2016

 

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The concept of outsourcing Services is not a recent phenomenon in the industry. Companies have been outsourcing their non-core services or functions to the specialists in order to get their work done faster and in a more effective and cost efficient way. The ideology of outsourcing of IT management functions started in the late 80’s and since then it has grown into a multi-billion dollar industry. At the initial stage, the key driver for outsourcing was to have a direct control over the operational expenses. However, over the period of time several other factors have come into picture that are equally prominent such as flexibility in control of investments and resources, risk sharing, acquisition of special skills and competencies, revenue sharing, establishing long term strategic relationship, etc. The decision of outsourcing attaches special significance in the strategy formulation in the company or any operation.

As far as telecom operators are concerned, it has been observed that the decision of outsourcing is based on a said set of parameters that is not different from the rest of the industry standards. In the recent past, it is been observed that telecom operators have extended this model by outsourcing management of network infrastructure, management of towers, billing systems, marketing, etc. This is creating new working models and relationships.

When a company outsources, it eliminates the cost associated with the hiring of new employees such as management oversight, training health insurance, employment taxes, retirement benefits, etc. Since it’s impossible for every company to be a specialist in all domains, so outsourcing lets companies focus on their core competencies. The company’s ROI increases when they outsource their functions to their outsourcing partner that is specialized in the required area as instead of gaining knowledge of just one person being hired, company can actually capitalize on the collective experience of the team of IT managed service provider for professionals who generally are well trained and certified.

Outsourcing helps companies to retain employees for their highest and best use, rather than wasting their time on things that may take them longer than someone who is trained in these specific areas. It helps to hire resources on contractual terms that falls within the budget and that is efficient enough to perform the task to the highest customer satisfaction. When a company plans for improving their costs, quality, service, or speed, the core business functions are pushed aside, but they still remains important and are essential to be handled with same conviction.That is the time when outsourcing plays a vital role and helps companies to focus on their restructuring without hampering their core business functions that is taken care of by the outsourcing partner. Though its taken care of by the outsourcing counterpart, but companies generally ought to look into the same by showcasing their involvement and that would help companies to grow with their partner.

By outsourcing non-core business functions, companies can spend their capital funds on items that are directly related to their product or customers. With the advancement of technology, it is very expensive and time consuming to cope up with the changing technology. Since IT Outsourcing Partners work with multiple clients, they remain updated about technology and hence are able to suggest the best solution. This kind of knowledge and experience dramatically reduces company’s risk of implementing a costly wrong decision.