What are the pros and cons of outsourcing?

To determine the opportunities offered by outsourcing, it is imperative to understand the pros vis-à-vis the cons of outsourcing.

Pros of outsourcing

• Enhanced focus on core business activities – outsourcing can free up your company to concentrate on its strengths, enabling your employees to focus on their primary tasks and the future business strategy
• Improved efficiency – opting for an outsourcing firm that specializes in the process or service you need them to carry out for you can help you in achieving a more efficient, productive service, often of better quality
• Controlled expenses – cost-savings accomplished by outsourcing can encourage you to release capital for investment in other domains of your business
• Expanded reach – outsourcing can give you complete access to facilities and abilities and otherwise not available or affordable
• More competitive advantage – outsourcing can help you in leveraging knowledge and skills along with your entire supply chain

Pros of outsourcing

• Service delivery – which might fall behind time or below expectation standards
• Security and confidentiality – which might be at risk
• Lack of flexibility – contract could prove too inflexible to support change
• Management challenges – changes at the outsourcing organization could lead to dispute
• Instability – the outsourcing organization could go out of business