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Top 5 Reasons Why You Should Consider Outsourcing

Written by: admin
January 7, 2013 • 4-minute read

A photo of a woman in the creative process outsourcing industry.

Outsourcing is moving out a function of your company to a third-party service provider. It’s different from offshoring in that outsourcing only entails having processes done outside of an organization by a third-party service provider.

On the other hand, offshoring refers to moving business processes offshore, usually where a business can benefit from significant cost savings. So technically, a company can offshore without outsourcing in the same way that it can outsource without offshoring.

Many Fortune 500 companies, about 70%, including bigwigs like IBM, HP, JP Morgan Chase & Co, have already embraced the benefits of outsourcing and offshoring, contracting vast volumes of work to countries like India and the Philippines.

If you’re considering it for your business, but are still in doubt, here are some of the key advantages to outsourcing for you to think about:

A photo of a workspace

#1 – Profitability. You can cut your costs in half!

If the processes you are thinking of outsourcing are labor-intensive, you can minimize overhead costs by about 40-50% when outsourcing your work to countries like the Philippines where labor costs are a fraction of what you pay your in-house employees.

Other costs you cut back on or avoid altogether would be related to employee benefits and insurance costs, office space rent, infrastructure investments, administrative costs, utilities, etc.

#2 – Access to World-class Talent

About 10% of Filipinos work abroad- as doctors, nurses, engineers, entertainers, teachers, and IT specialists, to name a few. Filipino talent is in demand in many countries worldwide, especially in creative industries where Filipinos compete for head-on with their non-Filipino counterparts and win.

The lack of employment opportunities in the country has resulted in a growing “Overseas Filipino Workers” population over the years. However, the recent boom in the Philippine Business Process Outsourcing (BPO) industry has given Filipinos an alternative. BPOs currently employ more than 600,000 Filipinos.

The demand for labor in the BPO industry encourages many Filipinos to stay in the country and explore working in specialized outsourcing fields such as Creative Process Outsourcing. Last year, the IT-BPO industry reported approximately $11 billion in export revenues, and the Business Process Association of the Philippines (BPAP) estimates it to reach $25 billion by 2016.

#3 – Focus. Put your energy where it counts the most.

As your company grows, you need to pay closer attention to core functions without disrupting or ignoring the small, tedious processes that keep the whole organization running smoothly.

By outsourcing non-core work to a third-party service provider, you boil your operations down to the basics. You can specialize in the core functions of your company without sacrificing the quality of non-core tasks.

#4 - 24/7 Customer Service. Never lose a customer because you’re not there.

Accommodating customers’ concerns is the core task of many outsourced service providers. These companies are set up to deal with customers as their existence depended on it. And in most cases, it does!

These companies have customer satisfaction down to a science and generally deliver faster resolutions, service, and feedback. Many providers also offer round-the-clock services, which allow you to serve your customers all the time, every day.

#5 – 24/7 Operations. Work gets done while you’re sleeping.

As your workday ends, outsourced service providers from the other side of the globe are just starting their day. If you partner with the right one, you can set up your operations such that your virtual team can continue working on your projects while you sleep.

For example, StraightArrow’s solutions for Digital Agencies and Creative Outfits include Virtual Teams: a mirror-set-up of clients’ creative teams that uses the latest online tools and collaborative technology to let workflow seamlessly between StraightArrow’s creative teams and the client teams they are supporting.

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Originally posted January 7, 2013. Updated by Maria Redillas on July 21, 2022.




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