Generally, outsourcing is greatly associated with large corporations, massive layoffs and cost cutting. The outsourcing game has recently become even more interesting and this influenced the domestic and offshore outsourcing industries to be begin in providing in outsourcing services to small and mid-sized companies.
The IT outsourcing services have been incessantly investing in pioneering technologies and skilled manpower and this to make the most of outsourcing services.
The practice of hiring a third party outside contractor to perform some portion of a company’s business activities, is what we call outsourcing. The following scenarios are taken closely for this outsourcing:
o A similar or better services at a better price can be provided with an outside contractor than can be provided internally.
o The company’s main business or the Core Business and its services are not generally not central and critical.
It’s resources on its Core Business are being focused by the company and by using outsourcing, while taking advantage of low cost providers who do non-essential functions better and cheaper.
The Common Types of Outsourcing.
Outsourcing has the two most common forms which are called Business Process Outsourcing (BPO) and Information Technology Outsourcing (ITO). The companies inside the United States (Domestic Outsourcing) and outside of the United States (Offshore Outsourcing), are the ones that offer outsourcing services.
What do we mean by Business Process Outsourcing (BPO)?
In the late 1990s, Business Process Outsourcing grew popular and this is also when cutting costs and managing quality became a paramount goal to large corporations competing in the worldwide marketplace. When a company outsources a part or all of its Non-Core Business, then they are typically engaged in BPO.
There are some common areas to look for BPO opportunities:
Marketing, Finance, Accounting, Customer Service,Procurement, Business Administration, Human Resources, and Sales.
The small and mid-sized companies have often utilized the BPO for payroll processing through ADP or one of their competitors.
Background Of Information Technology Outsourcing (ITO)
The ITO was one of the first types of Business Process Outsourcing. In was in the late 1960s that marked its origin, at the same time, this is also when the service bureaus provided excess computer time and ran applications on large main frame computers for large corporations. As computers grew less expensive than people, the ITO companies focused on developing the custom software for corporations or providing other value added services. The fact is that, IT Outsourcing has become so widespread and specialized and hence, it has evolved into its own separate category of outsourcing. Here are some common areas to look for ITO opportunities:
Data Processing, Network Management, Application Service Providers, Telecommunications, Data Security, Software Development, Infrastructure, and eCommerce.
Inside of the United States (Domestic Outsourcing) or in India, the Philippines, China, Eastern Europe and Russia (Offshore Outsourcing), are the places where you can locate firms specializing in BPO and ITO. The leading offshore outsourcing location for companies located in the United States is India, as it is an English speaking country and turns out over 300,000 college graduates each year. The trainings for developing and maintaining systems in the United States have been provided to many Indian nationals at the same time, they have been trained to be world class IT professionals.