Most companies rely heavily on contractors for a large or small portion of their business. For instance, a company can contract an accounting office instead of having an accounting department in the company. A business may also commission a transport company to distribute goods or a call center to track its shipping. In this article, we discuss what outsourcing customer support is and why businesses need this service.
When did it start?
Outsourcing emerged in the late 20th century and grew in popularity when companies began to take notice of and leverage its advantages. Many global manufacturing companies have since relied on factories in different regions or countries worldwide for different parts of their production process.
What are the reasons why some companies resort to outsourcing?
This process aims to move part of the company’s activity outside its organization. The primary objective of outsourcing is to increase efficiency and productivity while reducing costs and risks for a business. For example, an organization using a transport company uses a specialized private security company to guard the company’s facilities instead of hiring guards. Another example is a company using an IT company to provide development services for its website or application. There are several reasons why this has deemed attractive to many businesses; below are its advantages:
Focus on core competencies
Many departments and functions within the organization, such as manufacturing, sales, IT, accounting, marketing, transportation, security, etc. need follow-up and evaluation. With specialized outsourcing, using some of these functions can be more efficient, such as the use of an accounting office to follow up on the company’s accounts, a marketing company to market the company’s products or a transport company instead of purchasing transport equipment and hiring employees to do the work. In other words, specialized outsourcing can save the time and effort needed to focus the company on essential processes such as manufacturing or design to excel in their performance.
Quality and ability
The competencies in a company may often be sufficient for some activities, but when outsourcing these activities, the services produced may be of higher quality than the organization itself can provide because of the specialty of the party assigned to it.
Flexibility at work
Outsourcing gives a company the ability to find someone who does the work only when needed. For example, a company may need a group of employees in an application that lasts only six months. Indeed a company cannot easily hire workers for only six months and then cut them off. Using a contractor, in this case, is the best way to provide the required employment in this period.
Some companies may find problems making a product in its own country because of some political issues or government or tax reasons, or because of the lack of resources, employment, or transportation routes, in which case it is ideal to transfer operations abroad and in a country where the required components are the best and most appropriate.