CoolBasics Outsourcing

The Case for Outsourcing

What is Outsourcing? That is a question that you could be asking. More importantly, Why should you even care. Well! if there is one thing you learn today let this be it.

Outsourcing is the contracting out of a company’s non-core, non-revenue producing activities to dedicated specialists. It differs from normal contracting in that outsourcing is a strategic management tool that involves the restructuring of an organization around what it does best – its core competencies. Typically used in terms of the business world, outsourcing often entails an enterprise using another company, such as a consultancy or specialist service provider, to render a service that the enterprise can provide for itself, yet it is cheaper to utilize a third-party’s expertise and resources. Overall, companies tend to outsource to alleviate administrative burdens and focus on strategic areas – the mission for their being.

Two common types of outsourcing are Information Technology (IT) outsourcing and Business Process Outsourcing (BPO). BPO includes outsourcing related to payroll, accounting, human resources, benefits, and finance functions and activities.

Why Outsource

Generally, companies tend to outsource to alleviate administrative burdens and focus on strategic areas. According to the Outsourcing Institute, the top ten reasons why companies outsource are:

1. Reduce and control operating costs
2. Improve company focus.
3. Gain access to superior competencies and capabilities.
4. Free internal resources for critical core- purposes.
5. Access resources that are not available internally.
6. Accelerate re-engineering and re-organization benefits.
7. Handle functions that are difficult to manage, complex or are out of control.
8. Make savings on capital investments.
9. Share risks.
10. Bring in a cash infusion.

Surprisingly Outsourcing is not everyone, there are in fact a few reasons against outsourcing:

Some possible outsourcing disadvantages, which ordinarily tend to be more a matter of perception rather than reality, include:
1.Reduced control
2.Contract costs
3.Complex agreements
4.Difficulties in benchmarking

CoolBasics offers Payroll Outsourcing where we manager and administer your company payroll helping ease the hassle of processing payroll and helping you make savings at the same time.

So why don’t you give it a try. You might find that it just might work for you. Do you have any reasons for or against outsourcing, drop a comment below. We would be happy to hear from you

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