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The idea is to gain the benefits of lower labor costs like in countries such as India. Processes that are outsourced to these locations are carried out at much lower rates, with quality levels being maintained. This turns out to be a major cost savings for companies which can also save on operational costs such as payroll, power, administrative costs, HR, rentals, and utilities.
Cutting back drastically on expensive infrastructure requirements such as State-of-the-art IT systems, along with customer service call centers and technical helpdesks that do result in heavy investments to companies. It is important to keep the costs low by outsourcing these functions.
Focus on core competencies and redirecting the company’s internal resources toward mission-critical based activities. By outsourcing functions such as transcription, medical billing, and claims processing, healthcare practices can in order to get their focus back on their primary concern – their patients.
The idea is to overcome seasonal fluctuations in work and lack of workers during holidays as well as off-seasons. Deal with peak workloads and smaller staff at the time of vacations by outsourcing these functions.
Cloud computing does make use of services, application & technology that are quite similar to the internet world, and tend to convert them into the self-service utility. Cloud technology does require a high-speed internet connection as web-based applications that often require large bandwidth amounts.
Migrating to new technologies with minimum downtime as well as increased productivity along with quality by outsourcing IT processes. Companies can take the advantage of enhanced productivity cum quality. Getting access to world-class capabilities and improved operational performance
It is possible to avoid expensive short term outlays. It is better to outsource one-time applications which need to be ramped up in a short span of time and thus be able to require high manpower resources.
Getting protection from natural calamities, accidents, market fluctuations, or technical crises is expected. Disaster recovery mechanisms as well as detailed back up plans are provided by the offshore partner as they will help the client to respond rapidly and thus lead him or her on to operations immediately.
Several companies that draw up plans to outsource work to offshore locations do set up their entire business plan around varied functions to external service providers. Many experts feel that that outsourcing is not simply to cut costs but is now acknowledged as a business model.
