Outsourcing, The Performance Booster

Outsourcing or outside resourcing is contracting out a non-core business function by a business house to the third party. Outsourcing includes both foreign and domestic contracting. If a business process is relocated to a distant country it is called as offshoring and if it is relocated to nearby country then it is called as nearshoring.

To stay ahead of competition, control cost, increase quality, reduce time–to–market and offer innovative solutions, a company can consider outsourcing. It is sometimes more affordable to purchase a good and services from companies with than it is to produce the good internally.

An example of an IT company outsourcing is Microsoft buying some of its services from another provider like Capegemini to save on production costs. Alternatively, businesses may decide to outsource bookkeeping duties to independent accounting firms, as it may be cheaper than retaining an in-house accountant.

India is the hot destination for Outsourcing

India is one of the fastest growing economies in the world and it has made a name for itself in the outsourcing market by providing quality solutions at a low cost. Though other outsourcing destinations like China or the Philippines also offer low cost services and fast turnaround time but India’s strength lies in its huge talent pool of resources. India, with its state–of–the–art technology successfully handles data entry, customer support and also complex turnkey projects, such as the maintenance of legacy systems, business intelligence, system integration, business process re–engineering or E–commerce.

Recent illustrations are as follow:

Reuters has outsourced the covering US corporate reporting from an office in Bangalore, India. In outsourcing journalism and data processing, Reuters has become the first large media company to base US corporate reporting functions offshore.

Tech giant Google has stepped up its outsourcing plan and has been allocating more processes to companies such as Cognizant, which presently has a majority of its personnel in India.

An evolved medical education system and its established prowess as a hub for outsourcing give India an inherent advantage for healthcare outsourcing. Indian company serves clients like Hoechst, Du Pont, GlaxoSmith, Degussa, Abbott offers services like in-vitro testing, pharmaco kinetics, therapeutic studies etc.

Companies like Apple have been outsourcing core and non-core functions to countries like India for some time now, but now other major players like Barnes and Nobles, Bank of America and General Electric are all taking advantage of the benefits of outsourcing.

Thus, as a business evolves and adapts, many companies adopt outsourcing strategies to help control expenses, stay in front of competition, and propose innovative solutions without sacrificing quality. India has become a worldwide hub for offshore back-office services as large companies in the U.S, Europe and Australia are increasingly shifting their call centre operations, IT services, accounting services and other business procedures to India.

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