Outsourcing Industry
Written by rifqi on April 29th, 2010 in Outsourcing.
Outsourcing is often defined as the process wherein a company or an organization subcontracts or gives a part of their business function to another company either local or abroad. The outsourcing industry continuously plays a major part in most developing countries’ economic growth; some of these developing countries include India, Philippines and China.
The outsourcing industry is divided into three major types; the Business Process Outsourcing, Knowledge Process Outsourcing, and Information Technology Outsourcing. BPO or business processing outsourcing involves outsourcing a specific function like customer service and business consultancy. The Knowledge Process Outsourcing or KPO is an outsourcing category that involves advanced research, technical and analytical skills. Outsourcing programming and other computer related and internet related functions is known as Information Technology outsourcing. Business process outsourcing is the most popular and in demand type of outsourcing among the three.
Companies rely on strong telecommunication infrastructure since outsourcing services do not usually happen within the same country. Many businesses decide to outsource from low incomes countries where the costs for their services are considerably lower. For an example, clothing outfit H&M outsource production to Bangladesh and China. Thailand is known for producing high-quality T-Shirts.
Outsourcing a part of a company or organization’s business also helps save them time and energy. Predictable operational costs enables companies to have more control with their finances. Organizations believe that tasks can be done easily and efficiently if they are outsourced because the company in which the organization has assigned those tasks will focus on accomplishing them with the highest quality, therefore the organization can then focus on the business aspects that need keen attention another one of the Advantages of Outsourcing.
The major locations for outsourcing are China, India, Philippines, and Malaysia. The factors that usually help boost the outsourcing industry in these countries are the low cost of labour and the good quality of work they deliver to the multinational companies and organizations.
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