Which companies should employ an outsourcing strategy?

Outsourcing in companies: Outsourced tasks

Outsourcing refers to the outsourcing of tasks from a company. Individual tasks, areas of the company and sometimes complete business processes are given to other service providers or companies. Examples of this are transfers of company-related services such as IT functions.

Outsourcing refers to the outsourcing of tasks from a company. (Image: Redpixel - fotolia)

 

Advantages and disadvantages of outsourcing in the company

Why do many companies decide to outsource essential parts of their business tasks? A key statement that is often cited as a justification is: With such a measure, we can save financial, time and technical resources. Not only large companies or international corporations operate this outsourcing of individual company areas.

Small and medium-sized enterprises (SMEs) are increasingly using this model. In the IT technology sector in particular, many companies entrust business-related services to an external provider. The more complex your own requirements for the service provider, the more worthwhile an external contract can be. In the outsourcing process, for example, hardware and software, personnel or even parts of buildings can be transferred to the area of ​​responsibility of outsourcing providers for a temporary period.

In business administration, this procedure is also referred to as "asset and personnel transfer". Advantages: A clear focus of the company on its actual business (e.g. purchasing, sales, etc.). Are there any other disadvantages? There are the following examples of this. The outsourcing company should bear in mind that the quality of the outsourced services can only be influenced to a limited extent. Cultural differences (in cross-border outsourcing processes) between service providers and companies could lead to misunderstandings and thus increase costs.

Company-related services - advantages for your core business

In order to ensure precise assignment of tasks and the qualitative requirements, outsourcing companies should always conclude a corresponding contractual agreement. In such a "service level agreement" the scope and the quality standard with the service provider are explicitly recorded. Examples of this: Here it is possible to outsource different service areas on the infrastructure level, such as a data center, server or clouds. Company-related services can also be used on the application level (such as software, shop systems, own websites, intranet systems) and on the business process level (accounting tasks, digital product development, online marketing areas).

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Outsourcing in the company and the employees

The subject of outsourcing in the company can have advantages for different areas of the company. Examples are areas such as finance, resources or time management. Hiring employees for specialist tasks and investing in technical infrastructure can be expensive. Here it is definitely worthwhile to use the advantages of the company-related services. In this way, a specialized IT service provider can help tie up time resources and save costs. There are now very highly specialized providers with company-related services that offer cost-effective and precisely tailored solutions in their portfolio. On the other hand, however, there are points to be aware of that can negatively affect your employees.

Inadequate information for employees can be seen as a typical mistake when implementing outsourcing in the company. The delayed or omitted planning and implementation of change management can lead to rumors and possibly dismissal scenarios among employees. Therefore, from the beginning, attention should be paid to comprehensive and open communication.

Other risks may arise from a loss of internal know-how in the outsourced division; which the employees have developed over many years. Outsourcing does not only refer to individual areas, but sometimes to the outsourcing of jobs to more cost-effective regions or countries. The disadvantage: In some cases, employees are laid off, sometimes only in order to employ them for the same tasks at a lower salary in subsidiaries.

Competitive advantages with company-related services

The development of new applications and products is proceeding very quickly, especially in the digital age - customer requirements for a company's services and products are changing. For example, new servers are required to store data, and special firewalls are required for Internet security. Therefore, specific knowledge must always be up-to-date; so that it is possible to react quickly to changed requirements.

These examples make it clear that outsourcing enables the company to react quickly to such changes. An IT service provider has trained specialist staff who are deployed in a targeted manner and keep an eye on the latest digital developments. Outsourcing is also popular in companies in the sales environment. There are areas there that are divided into individual process sections. These are, for example, telephone acquisition, appointments or personal customer service. Specialized sales staff are used to increase margins in a targeted manner. Sales growth and cost advantages are the goals of such an outsourcing strategy.

Outsourcing in the HR environment - areas for company-related services

The human resource management environment is also ideal for outsourcing in the company. As a company-related service, HR outsourcing is involved in order to take over part or all of the tasks of the HR department of your company. From the first planning, administration, use of suitable software, to the final selection of suitable employees, you can submit tasks here. In order to have control over the efficiency of the outsourcing, keep track of the entire process through regular statistics and reports
Overview and can control the outsourced HR areas. In most companies, the HR area is a self-contained environment - often with its own IT infrastructure. You can therefore extract the processes relatively easily from your existing structures. Most of the services provided by the HR department are also regulated by statutory provisions. Ultimately, this is an important advantage for outsourcing in the company: The corresponding competence requirements no longer have to be held in your company, but with the provider who offers company-related services.