Outsource

What can be achieved by outsourcing, what should/could be outsourced? What are your reasons for outsourcing?

•           Lower costs due to economies of scale

•           Ability to concentrate on core functions

•           Greater flexibility and ability to define the requisite service more readily

•           Specific supplier benefits, better security, continuity, etc.

•           Higher quality service due to focus of the supplier

•           Improved internal management disciplines resulting from the exercise itself

•           Less dependency upon internal resources

•           Control of budget

•           Faster setup of the function or service

•           Lower ongoing investment required in internal infrastructure

•           Greater ability to control delivery dates (eg: via penalty clauses)

•           Lack of internal expertise

•           Increase flexibility to meet changing business conditions

•           Purchase of industry best practice

•           Improve risk management

•           Acquire innovative ideas

•           Increase commitment and energy in non core areas

•           Improve credibility and image by associating with superior providers

•           Generate cash by transferring assets to the provider

•           Gain market access and business opportunities through the supplier’s network

•           Turn fixed costs into variable costs

Despite the size of this list, every scenario is different. There may well be equally compelling arguments against any sort of outsourcing arrangement. It is therefore important that ALL the issues are considered before embarking upon the outsourcing course. This assessment should take into account all factors that you can consider.