Do You Need To Outsource?

In todays corporate world, outsourcing is the name of the game

. Rarely would you get to know a company who does not, at any point in its life, outsourced certain functions to a third-party provider. But is outsourcing really for everyone? If it is, which areas should you outsource and which ones should remain in-house?

In its most basic sense, outsourcing is the hiring of third-party in order to perform a specific function for the company. The third-party could either be a company or an individual. When outsourcing first came about, most companies simply outsourced those functions that are not income-generating or are too repetitive in nature. By outsourcing these functions, companies are able to save on the overhead costs. Aside from that, they are also able to utilize their personnel for a more productive work.

In recent years, however, certain lines of business, most particularly the manufacturing, has started outsourcing even the main core of their business. Although certain steps are still retained by the client company, those that require high end quality are usually outsourced. By doing this, companies are actually able to save on costs while upping the notch for the quality.

Outsourcing, whether its product development outsource that you want to do, goes through four stages strategic thinking, evaluation and selection, contract development, and outsourcing management or governance.

If you are thinking whether to do product development outsource or not, you first have to consider whether the expertise needed to perform the job cannot be found inside the company. If that is the case, outsourcing might be the more suitable solution. It is also a good idea to check if your company does not have the resources to see through the production to the end. This is one other case where outsourcing might be the way to go.

Outsourcing product development is not a relatively new decision. However, you have to make sure that you are hiring the right service provider. Keep in mind that, a business outsourced is still your business. The success of your outsourcing would depend on the executive-level support, ample communication, and the flexibility of your business.

by: Sean Countryman

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