What is Outsourcing and why is it Used?
The liberalization of global markets has competitiveness as imperative at all levels. Organizations and companies are creating and undertaking a variety of strategies to become more competitive. In this effort, the management system is becoming more complex and more demanding with time. In an effort to overcome this problem, organizations often approach the project of restructuring the system of management. As part of the restructuring of one of the strategies is the externalization of certain business processes or parts, known as “outsourcing”. Contact Syntax at any time.
The basic hypothesis of outsourcing as a business strategy affects the management processes. In addition to significantly affecting the structure of expenditures of the organization, it is fundamentally changing the management system of the organization in all its structural elements.
The quality of analysis, timeliness and persistence in the application, results from the application of outsourcing as a business strategy.
The process of liberalization of the global market inexorably expands and in those regions and industries which still do not fully function on the free market. Since this is a global process that cannot be avoided if we want to become and be part of the global market, many organizations implement the adjustment оf management system requirements of liberal markets. They are trying to increase their competitive ability to occupy its position in the market and ensure business continuity.
Significant structural changes within the management system used to achieve the global market competitive advantage. Competitiveness, and competitive advantage cannot be achieved without significant intervention in the management.
Outsourcing, as a type of business process, is present in most successful multinational companies, which sought proper business policies to respond to the increasing demands of the market and achieve business success in the harsh competitive environment. As a result of globalization, multinational companies first began to use price differences around the world by moving production in the countries with low labor costs, research and development in the countries that support them financially, sales and marketing in countries of high standards, and the center of administration in places with low taxes.
This is also the essence of outsourcing business processes that imply a transfer of part of the business activities that are not essential to an external partner or supplier.
We are witnessing enormous growth of the IT industry and the complexity of information systems, without which the modern conditions of business are unthinkable. Outsourcing in this case is the ideal solution, as shown by the data that is most frequently used as service of administration related to the IT segment.
Companies are increasingly faced with the dilemma of whether to entrust some business duties or not, which is not an easy decision. Each company is individual, but what seems as a fair solution to some, it can result in irreversible loss for others.
This was complemented by concrete examples related to the world’s most successful companies such as Apple, Dell, Microsoft, IBM and many others that have expanded their operations in India just using outsourcing. The capital of India is the main source of US companies who derive in this case, in an effort to achieve top performance and maximum flexibility to respond to market challenges. Also, the presence and the increasing growth of outsourcing in the USA, is becoming increasingly important in many conferences of international importance.