Rapidly changing and increasingly confounding issues are the reasons behind key shifts in business organisations today. Advances in technology, sophistication of business operations, and need for constant growth are factors that suggest a full-time focus on functional core competencies. As companies struggle to adapt to, and keep abreast with, the demands of customers and shareholders alike, the focus on core competencies may suggest outsourcing as a potential strategy to remain competitive.
As a strategic business tool, outsourcing enables companies to identify functions that are not directly creating value for customers or shareholders.
Some home truths
before a company begins to employ it as a strategic platform to reduce costs, improve productivity, and increase profits. When considering a decision to outsource a function, companies must weigh potential cost savings vis-à-vis risks. The trend among those companies that have better success rates in outsourcing indicates that they take their own time to do the homework, and build an appropriate business model focussed on outsourcing. Organisations that are willing to invest necessary effort and energy to go through a due diligence process, invariably come on top.
The cause and criterion for developing an outsourcing initiative may be cost savings; nevertheless, when outsourcing a customer service process, the success or failure of outsourcing depends only on the customer experience.
Value of employees
Successful outsourcing depends on how accurately customer demands are defined by the company, and how well they are executed by the outsourcing partner.
Some organisations underestimate the intrinsic value of their employees. Outsourcing partners bring new tools, technologies, and capabilities on account of their specialisation. Many small companies simply cannot afford to match the in-house support services that large companies maintain. Outsourcing will help them to act “big” by giving them access to the same economies of scale, efficiency, and expertise that large companies enjoy.
As a strategic business tool, outsourcing enables companies to identify functions that are not directly creating value for customers or shareholders.
Some home truths
before a company begins to employ it as a strategic platform to reduce costs, improve productivity, and increase profits. When considering a decision to outsource a function, companies must weigh potential cost savings vis-à-vis risks. The trend among those companies that have better success rates in outsourcing indicates that they take their own time to do the homework, and build an appropriate business model focussed on outsourcing. Organisations that are willing to invest necessary effort and energy to go through a due diligence process, invariably come on top.
The cause and criterion for developing an outsourcing initiative may be cost savings; nevertheless, when outsourcing a customer service process, the success or failure of outsourcing depends only on the customer experience.
Value of employees
Successful outsourcing depends on how accurately customer demands are defined by the company, and how well they are executed by the outsourcing partner.
Some organisations underestimate the intrinsic value of their employees. Outsourcing partners bring new tools, technologies, and capabilities on account of their specialisation. Many small companies simply cannot afford to match the in-house support services that large companies maintain. Outsourcing will help them to act “big” by giving them access to the same economies of scale, efficiency, and expertise that large companies enjoy.
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