Why outsourcing: no more “what to do” but “how to do it”
Sometimes we run into businessmen not yet very familiar with the new production schemes that characterize our time. In fact, quite often might happen that someone asks: “Why should I go for outsourcing?” The benefits related with personnel outsourcing are quite consistent and, more than talking about savings and efficiency, perhaps is more interesting to approach this matter from higher-level concepts.
Outsourcing some of our services means just that: give-up some of our control and get in exchange more time to devote to the core business, that can be further delegated and optimized.
A modern company perfectly knows that can dominate the market if prevailing on competitors. To achieve this goal, the company must be able to fully focus on its core-business without being distracted, psychologically and organizationally, from daily administrative tasks. With the outsourcing of services and personnel, the company can finally find the way to match the core-business development with the requirement of skilled human resources managed by an external third party.
Company business today has new targets: outsourcing, specialization and internationalization are just buzzwords that must be seriously taken into consideration by all companies if they want to increase the overall efficiency of the production system.
From this point of view, the companies are forced to re-consider their internal organization and configuration. Normally this re-thinking leads to four conclusions:
1. business is more global oriented than ever
2. product is more service oriented and the service is more and more integrated
3. tasks that can be outsourced are more and more
4. new businesses can be implemented: once the company is released from administrative tasks due to outsourcing, new business can be pursued accordingly
Quite often the lack of specific skills within the company is a good reason to go for outsourcing, since the company has no resources or personnel to handle specific matters.
For example, if the company is in the process of business expansion, especially into new markets, outsourcing is a viable and cost-effective tool enabling to develop specific skills to face problems related with the new market situation.
For sure, the most important tactical reasons for outsourcing is related with costs control and cost-cutting of overheads and operating costs.
Outsourcing helps, on one hand, to reduce the impact of company overheads and makes financial resources available to invest in variable costs required to penetrate new markets. On the other hand, thanks to the benefits connected with the specialization of external personnel, outsource reduces the operating costs as well. Of course, this reduction in overheads and operating costs will lead to overall benefits for the company customers.
Investments are always associated with considerable risks: outsourcing allows the company to become more flexible, dynamic and efficient to grasp the changes and changing market opportunities.
Thus, the partnership with an outsourcer provider like Alb Data, provides the following advantages:
• gives access to new technologies, tools and techniques that company might not possess
• eliminates training costs associated with the acquisition of skills required to manage these innovations
• offers career opportunities to staff that company might decide to transfer to the outsourcing organization
• offers access to new technologies, procedures and documentation available from the outsourcer
• provides great efficiency in performing the outsourced services
• makes operating costs clear for the process in question
• makes available business skills and experiences that the outsourcer has acquired from previous clients
Pursuing the core-business
Outsourcing allows the company to focus on its main business items, leaving the operational details for the handling of an external expert. It is a management tool that can lead to greater proficiency and effectiveness in the pursuit of the primary company objectives, which must be focused and interpreted to satisfy the final customer needs.
Therefore, for many companies, there is one basic reason that explains the decision to go for outsourcing: the necessity to get free from problems not mainly related to “what to do” but more related to “how to do it” when these problems concern ancillary business functions.
Too often the solution of these problems jeopardizes the decision process, leaving the decision to the middle management that absorbs a lot of time. All this may result in costs not only of financial costs, but mostly in terms of untapped opportunities.
Outsourcing allows the company to speed-up the growth-up and ameliorates the results throughout the increase of investments in more competitive areas.