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Outsourcing is the contracting of a business process to another party and is currently a very popular business strategy.

Contrary to general perception however, the concept of outsourcing is not new. It has actually been around, including foreign and domestic contracting, as far back as 1981 and has become a global trend by the early 1990s which continues to this day.

The first contact centre was established in the Philippines by 1992 and others quickly followed suit. By the year 2000, Business Process Outsourcing (BPO) accounted for 0.075% of the Philippines’s Gross Domestic Product (GDP). In 2013, it is estimated that the BPO Industry has generated US$ 15.5B and employs more than 900,000 Filipinos full time.

It is estimated to generate 1.3M jobs in 2016 and projected to grow at a rate of 17% annually.

While the decision to outsource a business process is primarily due to the desire to reduce costs, businesses quickly realised that outsourcing have other things to offer besides increased savings.

1. Outsourcing allows businesses to become more cost efficient

With a lower overhead and increased savings, outsourcing frees up internal resources which allows companies to put it to better use somewhere else such as research and development, marketing and business development, and customer service which contributes overall to the improvement of the business’ overall health.

2. Outsourcing allows businesses to become more flexibile

Outsourcing allows company’s to expand or downsize operations as needed without the associated costs such as equipment, office space, and other necessary infrastructure. It also allows businesses to acquire/offer other services it may not traditionally offer such as marketing and creatives. Certainly a huge advantage especially in a constantly shifting market.

3. Outsourcing gives businesses access to talent not available internally

People with specific skillsets and a particular experience are not always available, becoming a challenge especially for companies hoping to grow their operations in a certain direction and a given rate. This is where outsourcing becomes a brilliant solution, giving business a bigger talent pool to choose from to build their workforce.

4. Outsourcing allows businesses to better manage and mitigate risk

Aside from reduced cost, risk management and mitigration is one of the main reasons why businesses outsource. An outsourced work force allows a business to fine tune operations to take advantage of new opportunities or address a fast rising demand with not as much risk as they would have normally taken on in other circumstances.

5. Outsourcing allows businesses to focus on their core processes

Outside of cost efficiency and indeed a bigger profit margin, one of the biggest advantages of outsourcing is it’s ability to allow companies to focus on their core business. By outsourcing non-critical roles, businesses allow their staff to focus on their core competencies and specialization, improving the overall performance of the company.

Every business is unique and if you’re planning to outsource make sure that you’re clear from the get go why you’re doing this, what you hope to get out of it, and how you can make it a success. We can help you with that.

CLEAR provides customised outsourced solutions to small to medium size companies in Australia. With our extensive experience in recruitment, integration management, and delivering outsourced solutions for companies in South East Asia we can help you get the most out of outsourcing.

Get in touch for a free consultation:

1300 300 269 (Australia)