In 2017, to outsource or not to outsource is no longer the question. The issue facing organizations of all sizes today is how much — and more importantly — how best to outsource. With business functions ranging from IT, administration and manufacturing to accounting, human resources and call centers being offloaded to outside firms, business process outsourcing is booming.
Gartner, which predicted in late 2003 that a third of all IT outsourcing would be dictated from a business rather than technical perspective by today, now sees business process outsourcing going from $112.9 billion two years ago to $176.1 billion by 2008, reflecting a growth rate of 9.3 percent a year.
So, where does this rapidly-changing business environment leave the CIO? The organizational IT department still has the ultimate responsibility for prioritizing and managing the outsourced functions of all business units to ensure their support of the enterprise IT, but it’s becoming a complex challenge that the CIO of a decade ago couldn’t have foreseen. Increased outsourcing of business functions puts pressure on ClOs to succeed as they are struggling to keep control.
Talent Or Cheap Labor?
Imagine going into your office and covering your desk with drawings notes, designs, as you customize a clients product. Your client comes in to see the work, approves it, pays you and then does something very strange. He takes the tools, the documents, the notes, the designs, your pens, your pencil sharpener, your desk, and your chair.
Imagine the amount you received is about enough to replace the chair, but you’ll be drawing on napkins on the floor just like you did when that other client did the same thing to you a month ago. Businesses that last build a strong portfolio and a great store of work that they can look back on, re-use, and resell. Outsourcing portals do not promote the talent available, they promote the cheap work available. When workers start increasing the price the demand will drop much faster than if it were the talent that was promoted. Workers need more avenues for making their talents available.
If workers could spend more time offering products instead of rebuilding them from scratch it would be a richer marketplace. Why not make the progress the market economy is supposedly going to make on its own anyway? Why not make it now?
If you don’t want to spend time creating a base of resources from scratch every time you work on a project. Build a foundation to stand on as you grow your business. Sell products at a fixed price and also offer a few dozen copies per week in auctions. Offer customization services on top of your standard price. Don’t stop with the first iteration of a product. Improve it. Build MVPs over MVPs. Pitch them at events. Bring your buyers back for more. Ok, here’s the shameless plug: KEYSOME makes it possible for coders to continue the life of the product beyond the first iteration.
How sustainable are Traditional MSPs
Managed Service Providers (MSPs) are a new option for technical support and systems administration for businesses who do not have information technology management in their core competencies MSPs typically offered fixed-fee for services solutions to manage startups/SMB IT infrastructure and provide on-demand technical support.
The service is generally more cost-effective than traditional IT departments or consulting services For small-to-midsize businesses, technology headaches are a leading cause of unpredictable expenses and lost business. A ERP infrastructure fails at a critical juncture in a bidding process, there are no backups, staff lose hours trying to recreate valuable documents and the bid is lost to a competitor… and these sorts of stories are all too common in companies that aren’t big enough to have dedicated IT departments.
For many years there were only two solutions to this problem bring in expensive consultants on a case-by-case basis to handle tech needs, or hire a “computer guy,” a single individual who had to keep up with all the various technology demands generated within the company, even which they might be, strictly speaking, outside his or her areas of expertise.
Moving beyond STACKs — DevOps
If you have a programming project you want completed ASAP, hiring an on-demand coder is your best bet. There is no need to sift through resumes, offer candidates coding tests, and just hope you hire a coder that writes exquisite code. When you work with coders-for-hire, you receive all the benefits of working with a top-level software developer without any of the hiring hassles. If you are contemplating outsourcing your code creation, read on to discover the top reasons on-demand coders are an awesome option.
Whether you are creating a mobile application or designing a website, this biggest roadblock to success is your code creation. You can have phenomenal marketing skills and a beta list anxiously waiting for your product, but if you don’t have stellar code creators, your project is dead in the water. So how do you take your idea from pipe dream to reality when you’re not a programmer?
Using on-demand development services from local startups is a start, and is one of the fastest ways to get your product up and running. You’re not spending weeks trying to hire an in-house developer. You’re not paying a premium for a qualified coder thanks to fierce salary competition in your area. For development references : Open Brace, SAP Startup Focus Member.
Negative Impacts on Outsourcing
In business, the saying goes “a penny saved Is a penny earned,” but is this always necessarily true? It’s important to try and reduce costs, with outsourcing being one of many methods. The cheap pay rates, lax labor laws and relatively inexpensive upkeep makes perfect financial sense; however, it’s also an effective way to shoot someone’s business in the foot.
It is obvious. Making monetary gain is — and should be — the main focus of any private enterprise, the cost of outsourcing might outweigh the benefits. Think of outsourcing like throwing a stone into a pond. Initially, the splash covers a relatively small area, but the ripples hit everything around it. With many massive corporations outsourcing, the combined effect is staggering. Tempting as it may be, this approach will always have its drawbacks.
Poor Customer Perception
For any business, customer perception is critical. It only takes some bad Yelp reviews and angry tweets to drag an organization’s name through the mud, reducing sales in the process. Consumers associate outsourcing with cheapness and incompetence, reducing faith In the company. One of the biggest customer complaints is language barriers when dealing with outsourced agents. The thick accents of some customer service representatives creates a plethora of communication issues. Consequently, these misunderstandings lead to problems like broken promises, incorrect orders and over-billing, to name a few. Unfortunately, this also subjects a lot of innocent customer service representatives to cruel and even racist remarks.
Effects on the Economy
Job creation is also a point of contention for companies that outsource. Over 70% of Americans believe that the practice “steals” these positions and gives them away for a fraction of the cost. Their concerns are well-founded. Layoffs or closures from U.S. facilities due to outsourcing are a serious issue. It has been argued that removing these low wage jobs makes room for more advanced, high-paying positions at home; however, many eligible workers don’t have the background or skills to take advantage of such opportunities. For someone living paycheck to paycheck, losing their Job to a third party overseas is financially debilitating to say the least.
Otrtsourdng advertising and marketing makes sense for many businesses. Choosing an agency can be intimidating to many smaller businesses, with so many choices and options available. Ask few basic questions when selecting a advertising agency, including identifying needs, payment options, obtaining references and the size of the team working on the account.
Hiring an advertising agency is a big investment that has the potential to generate large profits and increase the reputation of your company. However, choosing the right agency is vital; otherwise, you can run Into sunk costs with little return on the money you’ve spent. Before hiring an ad agency, here are one question you should have answers to.
What are your needs?
Before even looking at agencies, you should have a clear picture In your mind about what your needs are, as well as your expectations from the advertising agency. There are several steps in any marketing campaign, which include planning, creating, researching and producing, and you may need help with all of these or only some.
Do you want a massive national campaign or are you targeting specific advertising niches? Knowing what you need and what you expect from the advertising agency means that both parties will understand the requirements, and it also will help you narrow down your list of choices.
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