There are many reasons for outsourcing various types of work functions, the main one being cost saving. An example of this is “Do I need an in-house IT manager when all I need them for is several hours a week?”. Therefore business owners often find it’s better to outsource expertise than employ it.
Resons to Outsource
Cost savings – Lowering overall cost of the service to your business.
Focus on core business –Outsourcing of Bookkeeping, Finance Systems, Business Systems or IT (internet presence, computers) to a third party will free up investment, people and infrastructure to develop the core of the business.
Cost restructuring – Outsourcing offers a move from a fixed cost (permanent staff) to a variable cost (Outsourced temporary staff).
Improve quality – A higher level of quality by contracting out to experts with a new service level agreement.
Knowledge – Access to intellectual property and wider experience and knowledge.
Contract – Services will be provided to a legally binding contract with penalties. This is not the case with internal staff/services.
Operational expertise – Access to operational best practice that would be time-consuming and too expensive to develop in-house.
Enhance innovation – The use of third parties to supplement the capacity of product innovation that was previously limited in-house.
Leisure – Individuals may wish to outsource work to adjust their work/life balance.
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