What is Outsourcing?
Outsourcing is a practice where one agency hires another to carry out services on its behalf. This system has become a norm and common activities that are frequently outsourced include Customer Support/Service, HR management, Application Development, Content Writing, Production & Supply Chain management, and Marketing.
Why Do Businesses Need to Outsource?
The core operations of a business are generally limited and outsourcing becomes mandatory when they need to get something done that does not lie within the scope of their expertise. Instead of hiring new full-time employees, outsourcing is a more economical and practical approach. Other reasons for outsourcing include:
- Cost Reduction in production/operations
- Speed up time consuming processes
- Improve product quality
- Divert focus towards pivotal tasks
Outsourcing IT Solutions:
The term “IT Solutions” covers a broad spectrum of services such as Web/Mobile App Designing, DevOp integration, Big Data Consultancy and Cloud Migration. These services are required by almost every big corporation including Banks, Educational institutions and Food Chains. Having no direct association to the IT discipline, making use of external resources it quite feasible.
Things To Consider While Hiring an IT firm:
- Prior research – It is mandatory to learn about the repute of an IT agency; only certified and experienced professionals are acceptable. Request detailed case studies for completed projects; take a look at their accomplishments and then finalize.
- Analyse the behavior – You should talk with and really get to know the people who are going to work for you. If they listen to you from the start and respond with enthusiasm, that is a good omen. Make sure they understand what you want and are willing to follow your instructions. If their attitude seems a bit stern or they’re taking too much time getting back to you, consider someone else.
- Compatibility – Will your people and their people be able to work as a team? The 3rd party should be a group of individuals that can communicate and relate with your business employees. This can be a problem with offshore outsourcing (hiring from a different continent or distant country) where issues such as language barrier and contrasting ideologies may arise.
- Line of Action – Closely observe the management and operation techniques of your outsourced team. Do they have the capacity, technology and skill to deliver the desired product?
- Transparency – Make sure that the 3rd party you are coordinating with does not fall short on contract terms, product quality, project documentation and other legal requirements. Safety comes first.
- Post project assistance – Problems might occur after the completion of your project. Hire people who are ready to provide customer support after the job is done.
Pros of Outsourcing
- Cost Effective – Outsourcing converts fixed costs into variable costs, i.e. you’re paying for services only while using them. Hiring a permanent team for carrying out tasks that are not needed on a regular basis results in wastage of your resources.
- Time-Savy – The time and energy required in the traditional hiring process (advertising, interviewing, shortlisting, training etc.) is saved and can be utilized to focus on the core operations of your business.
- Optimization and Efficiency – Experienced professionals handle your projects, which speeds up the overall process and improves the quality of the end-product. Working with innovative technology and strategies increases your market value among competitors.
- Risk Management – When certified and qualified individuals do your work, they make sure to eradicate all risks that could pose a threat to your business.
- Learning and Growth – Teaming up with a talented outsourced agency has a great impact on your working environment. Your employees can gain a lot of knowledge and conjure up pragmatic ideas through the experience.
Cons of Outsourcing
- Miscommunication – The outsourced firm may not fully interpret your vision and build upon their own understanding of the scenario. This could be off-putting to say the least.
- Lack of Control – Although you may have a say in how the 3rd party executes the project, they will not let you interfere with their conventional methods. As specialists in their field they will insist that they know what’s best and most of the time compromising is the only solution.
- Security Concerns – Outsourcing can raise security issues because it involves sharing your company data with an outsider. This can be a bigger problem if your privacy is breached by a foreign organization because prosecuting them might not be easy.
- Hazard Control Delay – Despite achieving a satisfactory output, a problem or break-down may occur later on. It may take several days or more for the outsourced agency to solve your issue, especially if they are a busy team of IT professionals. Your business may suffer and encounter huge loss during that period.