What is Outsourcing?

I am sure you have heard of the word “outsourcing” at least 5 times this week. Here we will talk about the very bacis: What is outsourcing and types of outsourcing that we encounter in our day to day life.

1^st question is:

WHAT IS OUTSOURCING???

Outsourcing is nothing but doing any process through a third party. It doesn’t have to be conducted in India or some other country. For example, if your kid gives his friend a chocolate bar, inexchange for doing his homework, he is actually outsourcing his homework. It’s as simple as this!

What is Outsourcing?

When we are talking about using a 3^rd party from a different country, we are talking about offshore outsourcing.

There are various types of outsourcing that we encounter in our day to day life. Here we will briefly disscuss about few important ones.

IT outsourcing:

it is the most available and widespread type of outsourcing we encounter. According to a research 28% of all outsourcing all over the world is IT outsourcing. IT outsourcing is the most cost effective way for companies to take advantage of world’s best programmer and IT specialist at a cheapest rate, without maintaining a in-house IT team. There are some popular websites, where you can hire IT specialist for very cheap rate.tasks that falls into  IT outsourcing are:

• Software Consulting
• Software Programming
• Website Design and Maintenance
• Email Server
• Application Hosting/Maintenance
• Network Maintenance
  And lots more…

Business Process Outsourcing (BPO):

using a contractual organization or 3^rd party person to conduct your business process is called Business process outsourcing (BPO). It consists of call center outsourcing, Finance and accounting Outsourcing, Claims Processing Outsourcing and Human resource outsourcing (HRO).

Call Centre Outsourcing:

For many small, medium and large businesses outsourcing a call center is an excellent way to generate sales and help current customers with tech support and customer support issues. Your customers phone will be answered in India, and business will run smoothly without hiring a US call center, which sometimes costs a fortune.

Finance and accounting Outsourcing:

using financial analyst and accountant to solve your business problem, but not keeping them in constant payroll (not inhouse) is known as Finance and accounting Outsourcing.

Claims Processing Outsourcing:

customers claim handling and taking care of all complains is not a easy job . Why don’t let other people handle all customer complains on your behalf? When a 3^rd party take care of claims processing on your behalf, it’s called Claims Processing Outsourcing.

Human resource outsourcing (HRO):

using 3^rd party organization to do the task of a human resource department is Human resource outsourcing. It consist of Hiring employees, writing handbooks, keeping up with legal updates, etc. it also consist of employee benefits programs, employee relations and state and federal compliance with HR audits, handbooks and investigations. Maintaining a HR deparment is not always cost effective, as a result HRO have been very popular in USA.