What is outsourcing?

What is outsourcing?

Business management is the process of responsible and quite painstaking. The success of the enterprise depends on many factors. Not the last place in this list also takes the ability to competently coordinate work, correctly distribute functional duties. The term "outsourcing" appeared in the business lexicon relatively recently, but it has already managed to firmly entrenched in it.



1
Outsourcing - familiarity with the concept

The term "outsourcing" has English roots and occurred from the words "Out", which means external, and "source", which is translated as a source. In modern lexicon, this concept characterizes the process of delegation to the organization of a part of the processes of production or business of a third-party company, which specializes in this direction. It is important to note that the transmitted activities are not related to the main production of the enterprise. The outsourcing company is a kind of subcontractor who has a narrow activity profile.



2
The main characteristics of outsourcing

So, the essence of the outsourcing process involves delegation of part of important, but not the basic functions of an outsource company. It is important to take into account that:

  • Such support is not one-time, but systematic. There is a cooperation agreement between the enterprise and outsourcing firm, which describes not only the types of work performed, but also their time interval. It may be a period of several months to several years.
  • The subcontractor is transferred to the maintenance of auxiliary (taking into account the main activity) of processes. These may include, for example, cleaning service, support for the call-center or maintenance of the organization.
  • Outsourcing also implies the possibility of transfers of business processes - accounting support, marketing directions, office work, personnel record or logistics.

3
Directions outsourcing

Select 4 directions outsourcing. Each company can choose its branch of escort in accordance with the needs:

  • Outsourcing IT directions.

As the name follows, the organization of this group specialize in writing sites, developing and implementing software products, technical support of computer and office equipment.

  • Outsourcing production processes.

We are talking about the transfer of a part of the production functions or processes. An advertising organization, for example, can conclude an agreement with a printing-out-based printing engineer for printing printing (in the absence of own printed power).

  • Business outsourcing.

The contract with the subcontracting organization may also cover the maintenance of individual business processes. The latter includes maintaining an enterprise (accounting, tax), personnel management, logistics or marketing.

  • Outsourcing management.

This area of \u200b\u200bcooperation in view of its novelty is not too popular. Outsourcing companies are involved in managing certain processes with mandatory analytical processing and assessment of the latter.

The scale of the work performed may be different, the only condition - this should not be a profile direction of the inviting enterprise.

4
Positive and negative features of outsourcing

Like any cooperation, outsourcing has both positive and negative sides.

Positive moments outsourcing

  • Competent delegation of certain functions makes it possible to reduce the cost of supporting functional processes.
  • Cash savings can also be achieved by attracting outsourcing organizations to accompany variable processes - there is no need for the content of the staff member.
  • In this case, the quality of the work performed increases. The company-outsourcer, producing contract work, is monitored and for the quality of its services.
  • There is an opportunity to focus on the development of the main activity. If you need to attract highly qualified specialists to the new level, they can also be attracted through an outsourcing agreement.

Negative outsourcing moments

  • Increase expenses. This trend may be observed if the company cooperates with a large number of outsourcing organizations. That this does not happen, it is necessary to analyze the costs and profitability of attracting third-party contractors.
  • Functional costs may increase if the outsourcer company suddenly turns its activities.
  • Attracting third-party organizations should not exclude control by the enterprise for the directions transferred to outsources. Otherwise, there is a risk of reducing the effectiveness of the management and its flexibility, the irrational concentration of technical processes.
  • There is a risk of information leakage even in the presence of rigid and strictly specified outsourcing agreements.

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