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Advantages and Disadvantages of Outsourcing

PC271905OLYMPUS DIGITAL CAMERAOLYMPUS DIGITAL CAMERAOLYMPUS DIGITAL CAMERAOLYMPUS DIGITAL CAMERAOLYMPUS DIGITAL CAMERAOutsourcing

This is the first of a series of articles being shared on outsourcing.

Outsourcing brings in a lot of flexibility and financial freedom but it also has its pitfalls. Any company looking to outsource must keep in mind the pros and cons of outsourcing before deciding to take the plunge. Take a look at this list of advantages and disadvantages of outsourcing.

Advantages of Offshore Outsourcing

  • Core activities of the business take center stage. Outsourcing non-core activities such as administration and back-office operations helps to put the focus back on the core functions of the business, such as sales and marketing.
  • One of the biggest advantages of outsourcing to India (or any other location) is cost savings. The lower cost of operation and labor makes it attractive to outsource.
  • Outsourcing reduces overhead costs that usually come with running back-end operations.
  • When certain functions of an organization become operationally uncontrollable, outsourcing helps to overcome such difficulties.
  • A company’s cash-flow can be streamlined.
  • By increasing productivity and efficiency, a business can be more successful and better-prepared for market challenges.
  • Outsourcing frees an organization from investments in technology, infrastructure and people that make up the bulk of a back-end process’ capital expenditure.
  • Outsourcing gives businesses flexibility in staffing and manpower management. Since the service provider is responsible for managing the workforce, you save costs and can also pick the best people to run your core functions.

Like this article?   Read it in its entirety on Outsource2India

 

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