Outsourcing is an assignment of certain tasks to freelancers or other companies by bosses or entrepreneurs.

The objective of outsourcing is not just to reduce the work load and free up more time from the bosses’ perspective but most importantly, to cut cost by hiring people outside the company on an ad-hoc basis.

In today’s economy, outsourcing has increased exponentially to a level that has sparked debates as to whether there should be nor should not be too many outsourcing jobs. While most business owners are all for it so as to free up their workload and time to be with their family and loved ones, some employee unions are often against it.

Whichever side you are on, outsourcing certainly provides a wide variety of benefits as in:

Save Costs

Most businesses become successful by minimizing costs and maximizing profits.

For instance, automobile company can reduce their spending by buying the essential parts they require and simply assemble them together.

Control Of Quality

Through outsourcing, companies have an easier time tapping into pools of expertise and having access to both intellectual properties and sustainable source of skills.

Furthermore, control of quality avoids the time-consuming process of training to develop the particular services in-house.

Finally by having new service-level agreements in their contacts, companies will be able to ensure that the quality remains and not being compromised. These contracts normally include penalties or legal issues for transgressions.

Time Related Advantages

Services are made possible and available at any time due to the fact that they can be implemented anywhere in the world regardless of different time zones.

When organization from US is off-duty, organization from Japan can take over. By having these measures in place, a product can be developed and marketed quickly because of outsourcing.

The automobile company we mentioned earlier can keep stock on various car components in their warehouse and get relevant staff to assemble them. They do not need to waste too much time manufacturing parts and always be at hands in their depots.

On the contrary, unions protested that outsourcing can cripple a local workforce by reducing jobs for locals. This usually happens when services performed in local companies are now relocated overseas, especially countries specializing in cheaper labour.

When there is competition for jobs, the labor rates will decline into unemployment which will certain affect the country’s economy.

Moreover, language differences are also detrimental to service quality. When services are from places with different language and culture, it will do more damage.

Since data is transferable from place to place, leakages and even misuse of info may occur. Such as the case of bank accounts being tampered with when call centres got hold of customer accounts.

Apart from unions, outside sources claim that outsourcing is unproductive as companies resort to outourcing instead of buying software to automate the entire process and save twice as much time and money being spent on outsourcing.

In a nutshell, here are the pros and cons of outsourcing. Hence the decision to outsource or not still belongs to the company or individual entrepreneurs.