The Concept of Outsourcing and its Implications to Business

THE IMPORTANCE OF OUTSOURCING AND ITS IMPLICATIONS TO BUSINESS
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(May 19th, 2012)
The Concept of Outsourcing and its Implications to Business
Introduction
Outsourcing refers to the subcontracting or contracting of noncore practices to free cash up, time, personnel and facilities for practices where a given company holds a competitive advantage. Various companies with strength in various areas may decide to contract out legal, marketing, data processing, manufacturing, payroll accounting and other aspects of their businesses in which they are best at. Thus, this enables a reduction on the average costs. In most cases, outsourcing forms an important part of reengineering and downsizing within a given company. In some instances, outsourcing can be called contracting out.
In the real sense, outsourcing has turned out to be a very common practice in various current business professions. This is because when other individuals are hired to carry out given jobs, it reduces stress and load of the initial agent and facilitates quality work by specialists within a specific field (Burkholder, 2006).
In the case of professionals containing hectic schedules and those independent contractors, this concept is divine. On the contrary, the real truth is that in a similar way to anything else, it is very much beyond perfection in addition to any utopian contribution. Outsourcing in companies as a concept contains a lot of advantages. Firstly, it normally lowers levels of stress which heaves an individual’s shoulders and getting services the experts with specialization in a specific task or field. In addition, time constraints are normally relieved. This is because of more than a single party shares the weight. As a matter of fact, distribution of weight balances all things. This, it reduces the stress involved. Furthermore, because these specialists normally focus on a given business aspect, the increase in the product quality is guaranteed (Herrick, 2000).
This makes all the involved parties to look perfect and satisfy all the desires and needs of the business. Another outsourcing advantage is that it enhances a positive image to the business. This applies when big corporations or businesses which can give workable and attractive funding towards those outsourced individuals and get increased profits in addition. Alongside professional reputations, business and everyone’s success increases. However, the disadvantages of an arrangement like this are normally inclined towards increased profit sharing and expenses.
If companies outsource, they have a lot to pay out and add to their overhead. In itself, this may add stress to the company. All individuals comprehend that widened depts. Do not represent fun at all. On the other hand, it may be constricting to some companies. Sharing of profits normally lowers the quantity of each involved party as more parties get involved in the require payment and venture (Ciccotello & Green, 1995).
With an increased payment distribution, all parties within the company gets less than they would have got if the company had ceased to outsource and add a lot towards the overhead. However, towards the end, the quality that emanates from outsourcing is expected to act as an advantage for all people in the long run. This is despite the idea that these individuals involved may be inconvenienced in the short run. Thus, distant benefits enhanced through outsourcing tend to give an increased enticing incentive. The outsourcing concept is still in the process of development because businesses ought to expand and become increasingly sophisticated. This is an advantage because there is room for the flexing of wings, soaring and creativity which harbor no limit at all. This represents an additional reason which makes the practice and concept of outsourcing; to be not only valuable but also necessary as far as business is concerned. In most cases, the growth of the business relies a lot on outsourcing.
In the real sense, outsourcing as a business concept has been on the mind and list of the majority of owners of businesses in the whole world for quite some time. Although it has been present for quite some time, confusion still exists concerning the meaning of outsourcing and outsourcing companies. Various viewpoints exist on the meaning of outsourcing. As a matter of fact, it represents a company which gives out some project or work to qualified individuals to carry out a given job within the agreed contract and fee. In addition, there exist different elements and types which any business should put into consideration as far as outsourcing is concerned. The initial outsourcing mostly identified is added services. These services may be normal or simply offer support to a given company or give business operations. Some portion of these services of support which the majority of outsourcing companies offer are accounting, cleaning services, information technology and human resource. Value added services which are given through outsourcing are purchasing, sales and many others. When it comes to total outsourcing, it signifies the process where a given business outsources partially or wholly various business operations. A perfect example is a company which gives customer care services. Such a company may resolve to outsource their services to a different company as they may be well equipped with highly qualified individuals with the correct skills. Lastly, we have operational functions outsourcing. This means the same thing as human resource outsourcing.
Business process outsourcing refers to the process where outsourcing companies become responsible for all operations they intent to make. A given business may enjoy various advantages when it outsources the work. That particular company or organization may concentrate a lot on other activities of the business. In addition, the company may try to focus on other efforts and resources of the business. Operational cost may reduce which may lead to flexible structure creation closely associated with the job of the worker. The encouraging element about various companies of outsourcing is that they offer employment to trained individuals who are able to improve the services they offer.
If a company or an individual wishes to hire an outsourcing company, it is vital to understand the idea that the individual or the company may be employing a business partner. Hence, the company or an individual ought to function basing on the rules and regulations of the individual. In addition, the company should work alongside the business and should not contain a different work ethic in order to ensure that there is success in the business. Also, when searching for an outsourcing company, time should be greatly avoided until the time help is required. When beginning a business, it is wise to look out for various outsourcing companies. Additionally, reso...