Outsourcing,saleem(raj)

OUTSOURCING

WELCOME

Table of contents

Outsourcing

Definition

Top reasons for outsourcing

Usage of outsourcing

Methods of Outsourcing

Disadvantages of outsourcing

OUTSOURCING

DEFINITION OF OUTSOURCING

Outsourcing is the process of contracting out a business process, which an organisation may have previously performed internally or which the company deems necessary or important, to an independent organization, where the process is purchased as a service.

The opposite of outsourcing is called insourcing, and is sometimes accomplished via vertical integration. However, a business can provide a contract service to another business without necessarily insourcing that business process

Top reason of outsourcing

Without question, outsourcing has fundamentally changed the global business landscape. Not long ago, outsourcing was simply viewed as a means to reduce various operational costs. However, as competition increases and budgets wear thin, wise organizations are turning to outsourcing to add value beyond lowering costs

Usages of outsourcing

Reduce and Control Operating Costs - The single most important tactical reason for outsourcing is to reduce and control operating costs. Access to the outside provider’s lower cost structure, which may be the result of a greater economy of scale or some other advantage based on specialization, is clearly and simply one of the most compelling tactical reasons for outsourcing. Additionally, companies that try to do everything themselves may incur vastly higher research, development, marketing and deployment expenses -- expenses that have to be passed onto the customer or taken off the bottomline. Today’s customers are too sophisticated to accept the cost representative with an organization’s attempt to maintain singular control over all its resources

Method of outsourcingThere are basically two methods to outsource things to a better company that can do as we want even better than us. They are, 

• Outsourcing projects to companies.• Hiring manpower from companies and execute your projects. 

Both these methods have it’s own advantages and disadvantages. But it depends on your requirement to choose one among those. For example, if you are in need of software that can maintain your business operation, it is better to outsource the project to some company and ask them the end result. If you have some e-commerce site to maintain and to do customer support, it is better to hire professionals on those areas and make them work under your control as it needs your control more than in the first one.

Outsourcing has generated much controversy in recent times for various reasons. Outsourcing has been resorted to with mainly for maximizing profits. Before deciding on outsourcing, the outsourcer should examine in detail the various problems that are likely to crop up. Some of the problems can be easily straightened, while others can result in the outsourcer finding itself in a no-way out situation..  Chance to nurture in-house talent is lost:  The employees of the outsourcer are deprived of an opportunity to develop skills and experiences with respect to the task that is being outsourced. Loss of Managerial Controls:  The service provider is a separately managed entity .The contract between the service provider and the client may overlook certain factors, which could result in a total mismatch of policies of both parties. It may be much easier for the client to get the job done by its own employees rather than someone else over whom he has no control. 

Disadvantages of outsourcing

conclu

sion

Submitted by

PRIA, SALEEM, RAVINDRA

AND

HANIEL

THANK YOU