Cost Savings
The lowering of the overall cost of the service to the business. This will involve reducing the scope, defining quality levels, re-pricing, re-negotiation, cost re-structuring. Access to lower cost economies through off shoring called “labor arbitrage” generated by the wage gap between industrialized and developing nations.
Time Zone
A sequential task can be done during normal day shift in different time zones – to make it seamlessly available 24×7. Same/similar can be done on a longer term between earth’s hemispheres of summer/winter.
Cost Restructuring
Is a measure that compares fixed costs to variable costs. Outsourcing changes the balance of this ratio by offering a move from fixed to variable cost and also by making variable costs more predictable.
Operational Expertise
Access to operational best practice that would be too difficult or time consuming to develop in-house.
Contract
Services will be provided to a legally binding contract with financial penalties and legal redress. This is not the case with internal services.
Knowledge
Access to intellectual property and wider experience and knowledge.
Com-modification
The trend of standardizing business processes, IT Services and application services enabling businesses to intelligently buy at the right price. Allows a wide range of businesses access to services previously only available to large corporations.
Com-modification
The trend of standardizing business processes, IT Services and application services enabling businesses to intelligently buy at the right price. Allows a wide range of businesses access to services previously only available to large corporations.
Reduce Time to Market
The acceleration of the development or production of a product through the additional capability brought by the supplier.
Improve Quality
Achieve a step change in quality through contracting out the service to professionally trained staff.
Risk Management
An approach to risk management for some types of risks is to partner with an outsourcer who is better able to provide the mitigation.
Staffing Issues