ITO or Information Technology Outsourcing is where outsourcing related to technology or internet such as computer programming. Business Process Outsourcing (BPO) involves contracting out of operational functions to a third party service provider. Software R&D — offshore software development Knowledge Process Outsourcing (KPO) is a type of outsourcing which involves or requires a more advanced technical skill and a higher level of expertise.
A good offshore outsourcing strategy begins with the analysis of risks and rewards of outsourcing specific IT functions of your organization. While developing a strategy, we take into consideration the following:
After understanding the business drivers, needs and requirements, BorderlessMind will develop an Offshore Solution for the Client and present it as part of the formal contract. After identifying which of your IT functions are most suitable for outsourcing, our experts will help you :
Cost advantage: Costs are arguably the chief motivation behind outsourcing. Often companies find that contracting work out to a 3rd party is cheaper.
Focus on core competency:There are a lot of business functions in a company. For example, human resources, information technology, manufacturing, sales, marketing, payroll, accounting, finance, security, transportation and logistics among others. Most of these are not "core" to the company. A "core" activity is one which offers the company competitive advantage over its competitors. It is an activity that the company does better than the competition, which is the main reason its customers do business with the company. Having to handle non-core functions is a distraction, so many companies outsource them.
Quality and Capability:Often companies don't have in-house expertise for certain activities. In these cases, it is more efficient to outsource, and resulting products and services tend to be of higher quality when provided by outsourcing vendors.
Labor flexibility: Outsourcing allows a company to ramping up and down quickly as needed. For example, a company may need a large number software programming experts for 6-8 months to develop an application. It would be infeasible to hire people for only 6 months. Outsourcing, however, can provide flexibility so the company does not have to worry about hiring and firing.
Offshoring provides many of the same benefits as outsourcing, including:
Cost savings: Companies usually offshore manufacturing or services to developing countries where wages are low, thus resulting in cost savings. These savings are passed on to the customers, shareholders and managers of these companies.
Skills :The competitive advantage of nations often means that some countries or regions develop a much better ecosystem for certain types of industries. This means there is better availability of skilled human resources in that region for specific types of tasks. For example, India and the Phillipines have a large pool of English-speaking, college educated youth; as well as a mature training infrastructure; that makes it ideal for business process outsourcing. Therefore, many companies choose to offshore certain business functions (e.g. call centers for customer support) to these locations. These can either be captive or outsourced.
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