What is Outsourcing?

…and what are the benefits for the Sales and Customer Service functions?

Outsourcing is the process of hiring an independent organisation to carry out a business process which was previously performed internally. Outsourcing is very common and is used in a great variety of industries, from animations to IT. It’s a useful and valuable way for a company to spend its money, as often it allows that company to focus on more important aspects of their work, saving time and money. For example, someone running an online shop may be more concerned with providing good-quality clothing on time than learning how to create and manage the website, and so would find a separate IT company to do this. Essentially, it’s like paying your big brother to do your Maths homework so you can spend more time doing your History project. One particularly common form of outsourcing is placing companies’ call centres abroad, typically in countries such as India.

There are a wide range of advantages of outsourcing, both for the company using it and, in cases like India – which is seen as the telephony outsourcing centre of the world – outsourcing can even benefit the country as a whole. This is because very often the residents’ quality of life up and down the country can be improved by the process of the multiplier effect. However, the benefits which this article is most concerned with are those that outsourcing provides for the Sales Functions and Customer Service Functions alike. By outsourcing these departments, a company can ensure that such services are handled effectively and professionally without having to pay for training for new employees, as well as their wages. Money is saved and often customer satisfaction greatly improved, boosting sales and consequently profits. This effect is heightened by the reduction in the consumption of human and financial resources that back-office operations tend to cause. Space is also saved, as a whole department is housed elsewhere.

Outsourcing does not have to be a permanent solution, but can be used seasonally for operations with cyclical demands to provide additional resources for a fixed period of time. This also provides continuity to the company and avoid the uncertainty and inconsistency that come with periods of high employee turnover.

As the company used is composed almost entirely of people who work, in this case, either in Sales or Customer Service, and it focuses on providing these departments for other companies, we can trust in their expertise and professionalism, ensuring that these two departments are as strong as any other within the business. There is generally a greater control over the workers as they are the focus and driving force of the company. Therefore, the money spent invested in them is used more efficiently as they are better managed.

Alternatively, a company may choose to outsource a different department, like the IT department. This, too, could benefit the Sales and Customer Service functions as the company can afford to invest more time and money into improving them. Allowing more specialised and experienced outsources workers to take care of these things means that, not only will they run more smoothly, but also the company can focus on developing more important or relevant departments.

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