All entries for Friday 15 April 2011

April 15, 2011

Things to Consider when Outsourcing

Some Idea to consider while outsourcing:

1-  Understanding what to outsource depends on understanding where the competitive advantage of the company comes from. the company's competitive advantages should not be outsourced if possible.

2-  Outsourcing is not about cutting costs only. The cost might increase but there will be an increase in the revenue too. Moreover, it might result in cutting some other costs.

3- It is important not to lose complete control over the outsourced activity because the client might not have the ability to control or effectively manage the vendor.

4- When an activity is outsourced, it is important to assign some mangers to handle the vendor.

therefore many researchers suggest that a exiting strategy should be established in the contract to handle any issues with the contract, security, or the quality delivered. this exiting strategy allows the company to switch the vendor without any damage.


Developing Markets for IT Outsourcing

some might argue that the major aim of out sourcing is to get the best possible quality in the lowest possible price. taking this concept as a way of work for IT services, it is interesting to know that  India is number four on the top five list of customer satisfaction in a survey done in the UK’s top IT spenders. Last year the percentage of UK companies that outsource IT services in India jumped from 47% to 57%. Moreover, the experts are expecting the Indian outsourcing market to grow in the next ten years and that new IT outsourcing markets to grow in the future such as the Egyption market.

businesses are becoming more globally managed. the physical location of a company is run by people from all over the world. 



Outsourcing 1

outsourcing is recommended by EFQM as it helps the organisation to focus on its core functions, cut the costs, and might help in getting better services.

I think outsourcing has proved a success in many organisations and its failure was usually related to managing the contracts and monitoring the quality or choosing the suitable resourcing provider.

it is recommended therfore that these aspects should be taken into consederation when out sourcing:

1- choosing resourcing providers and negotiating the contract conditions must me done by a team that involves all the departments affected by outsourcing such as financial, HR and others.

2- Prepare the staff in the company by informing them about the outsourcing plans. this can save the company staff resistance in the future.

3- choosing providers should have a balance between price and quality.

4- the organisation's requirements should be clearly identified before negotiating any contracts.


the subject of outsourcing is wide and I think it deserves to be explored and developed becuase it can be an opportunity to build a new business environment were sharing and cooperation is the norm.


April 2011

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