The Outsource IT to Philippines Blog

Select Page

Outsourcing, as defined, is paying another person or company to do something for you that you could have done by you or your staff. It has been a business strategy for as long as 100 B.C.E. with the Romans but, was only formally identified until 1989. The need for external suppliers for services at that time was the baseline stage in the evolution of outsourcing. In the 1990’s organizations geared into cost-saving options by farming out functions necessary to run a company. However, these functions were not related to the core of the business. They began to contract service companies to deliver accounting, human resources, data processing, internal mail distribution, security, and plant maintenance.

Throughout its existence, this business strategy has helped shape economies both locally and internationally. A local business would be more appealing to potential investors with their capacity to outsource. These investments will ultimately grow in the local economy as the business thrives. Foreign investors will also be a big factor. For the foreign economy, sourcing affords much growth in the influx of new money. They can develop into a future business partnership for western and Asian nations. The strong economic standpoint allows them to do business internationally and purchase goods and services from several nations.

Offshoring has also given us many ways to cut costs. There is a vast difference in the wage patterns of the western developed countries and the developing companies. The kind of work that is done in the west for a very high price can be obtained at a much cheaper rate in the developing countries. The difference varies from up to 60%. Developing infrastructure is also not a problem. Outsourcing companies will take charge of the necessary infrastructural changes as per work requirements. Training and hiring process is also less costly for some sourcing companies to take full charge of training and producing top talents for the job.  Saving and efficiency is always a strong selling point for outsourcing companies.

You might have preconceived ideas about outsourcing. That’s why most are hesitant to try partnering up with this industry. Debunking some outsourcing myths will help you understand it better. One myth is that you will have no control over your business. Farming out gives you more control over your business, it just shifts the process information. You and your partner are to communicate guidelines and expectations to meet your needs. Second is it only aims to cut costs. In reality, most companies seek out contracting needs in the process of expansion. It provides a more competitive advantage. Most are also concerned about whether or not the contracted workers have sufficient knowledge. Contracted workers are knowledgeable in their field of expertise. Pieces of training are conducted to align with company goals. Another common notion is that outsourcing is that it is limited only to big business. Small businesses reap more out of offshoring because it aids in efficiency and effectiveness. The biggest concern in choosing to contract would be privacy and protection. Companies provide confidentiality clauses that suit your privacy needs. You can personally draft one and you and your outsourcing partner can talk it over.