Quick take a guess what is the most outsourced service on the earth today?
Think of all the potential services in your company that can be outsourced: cast your mind far and wide. Try not to miss anything.
Once you have thought of potentially every service that can be outsourced, make the guess again. Out of everything that possibly be outsourced, what is the most outsourced service on earth?
If you guessed call centers, you are wrong. In fact, if you guessed any of the following services- Logistics, IT, sales training, fleet management or payrolls- all popular services to be outsourced, you are wrong too.
Cast your mind wide and far within your company-how many services did you think of that can be outsourced. Think about all the various departments in your company – the Information Technology department, Human Resources, Marketing, Sales, production and Manufacturing, Logistics, Purchasing, Finance, Administration, Legal and imagine all the various possibilities for outsourcing that exist in each of these departments.
Why do companies outsource?
Because, Outsourcing provides leverage.
What does that mean?
It allows you to do things you could not do yourself, and it allows you to do them faster, better and at a lower cost.
Like all leverage, outsourcing is a double-edged sword too. On one hand, it allows you to do more, faster. On the other hand, if it goes bad, it can easily kill your business. If you do not believe that is possible – you can look into the Fox Meyer saga from the 90s and see for yourself.
The trend of outsourcing continues to grow unabated with the whole gamut of services, from simple to mission-critical tasks. There is not a single company on earth that does not outsource anything. It is not just about cost arbitrage, it is also a finer expression of division of labour at the organisational level.
What are the key criteria that help you decide when to outsource and when not to outsource?
In this book, you will learn to recognize how ubiquitous outsourcing is the modern day organization and life, and how to keep your eyes open to recognize situations that are amenable to outsourcing. The full list of all outsourceable activities within a company may include an element of surprise.
You will also learn why you must NOT outsource in some circumstances because of strategic or tactical reasons.
The big question that everyone asks is…