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The contemporary use of outsourcing in businesses has grown significantly in recent years. In fact, a lot of companies these days delegate some of their operations to individuals or groups from other organizations and countries that specialize in that operation.

While cost reduction is one of the primary reasons companies opt to outsource, recent studies show that the industry trend is changing. Today, client companies are accessing outsourcing not just to stabilize overhead costs, but to have access to stronger skills, new technologies and process improvements to stay ahead of their competitors.

Other Benefits of Outsourcing

In the recent Outsourcing in Europe survey carried out by Ernst and Young, the company found that cost reduction remains the top reason for outsourcing for 42 percent of the 3,700 respondents. 33 percent of the respondents, on the other hand, see outsourcing as a way to improve operational efficiency.

The study also found that when the relationship between client and supplier matures, the client starts to search for other means to make the outsourcing relationship add more value to their business. That is they tap into the specialist skills, technologies and specific sector knowledge their outsourcing partner provides. As such, the process becomes more about collaboration and partnership between the client and supplier and not just as a channel for cutting costs.

According to Marek Sujecki, an IT advisory senior manager at EY, with clients seeing outsourcing beyond an exercise of reducing costs, outsourcers are also exerting effort to provide deep sector or service knowledge to meet client demands. With such additional value, closer collaboration and partnering between client and outsourcer can be further boosted, which in turn can open up to the possibility of businesses outsourcing their non-core processes or activities.

The survey only goes to show that the decision of many companies to outsource is not influenced by the cost reduction it can bring to the table alone. Instead, many client companies are seeing the process as an attractive means to empower their businesses and stay ahead of the competition. They view outsourcing as such because it gives them access to stronger skills, new technologies, and better processes, which ultimately allow them to increase efficiencies, focus on core competencies and gain better profit margin growth. This is proof that the outsourcing arrangement is changing and it is changing for the better, providing businesses enough reasons to give it a try.

How about you, have you considered outsourcing some of your business’s functions? If so, what could be the reason behind your decision to outsource?

PrimeOutsourcing Services

Outsourcing has now become an essential part of every business. Today, companies go in for remote work to help their staff find a work/life balance, have access to top talent worldwide, and save costs. As seen in today’s industry, the Philippines has become one of the trusted countries foreign companies outsource to. The outsourcing industry in the country is booming and is seen to continuously flourish in the coming years. 

With PrimeOutsourcing, you will have direct access to professional talents that are well-experienced in different types of industries. We have an array of services that will cater to your business’ needs. Contact us today to request a quote, for further inquiries, head over to our FAQs page.

By: Seb Malupa | May 12, 2014 | Business Process Outsourcing, Outsourcing | 0 Comments

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About the Author: Seb Malupa