Off-Shoring / Outsourcing: A Cutting Edge Advantage By Steve Parker At Isnare.com Ezine Articles

No matter what naysayers say about off-shoring / outsourcing, the truth is financial statements of companies prove outsourcing works, and how. Company accounts books have changed colour, going from red to black, adequate testimony to the fact outsourcing helps to reduce costs. To put it simply, debt-ridden companies have turned fortunes, cleared debts, and shown profits after making a wise decision to off-shore / outsource to a service provider in India with resources, skills and ability to deliver A-grade work within set time lines and company budgets.

There are many reasons why a company decides to off-shore / outsource, but not before holding tactical meetings, weighing pros vs. cons before making a decision that can cause tremendous breast beating amongst recipients of pink slips, most of whom later on become strong advocates against off-shoring / outsourcing. When companies decide to off-shore / outsource, the rationale is not to make redundant, but to prevent a diversion of resources from core company operations. There are five major reasons why a company decides to off-shore / outsource are:

6. Improving Business Focus to allow them to concentrate on important, wide-ranging business concerns, while a service provider carries out the day to day operations.

7. Competitive advantage through expanded skill set and access to world class capabilities that off-shoring / outsourcing service providers provide with the use of new technology, tools, modus operandi, methodologies, procedures and documentation.

8. Provision of accelerated re-engineering benefits, as already, service providers are working to world class standards and processes. There is a major cost reduction in off-shoring / outsourcing as constant technology / staff upgrades can make deep inroads into company budgets.

9. Risky Information Technology investment is offset by off-shoring / outsourcing to a service provider with cutting edge IT resources.

10. Off-shoring / Outsourcing allows companies to redirect finances from non-core operations to strategic income generating operations.

Here are some reasonns that summarize why foreign companies are coming to India:

1) To leverage India's intellectual capital, Fortune 500 companies are setting up R&D, engineering and software-development centers in India

2) Fortune 500 companies are leveraging the availability of a wide range of raw materials as they reduce the cost of inputs for manufacturing.

3) To compete effectively on cost, Fortune 500 companies are setting up operating structures involving various degrees of localization of the supply chain.

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