Outsourcing Services: Transforming the Business Landscape

Outsourcing ServicesOutsourcing is creating buzz in the business world. While many companies take advantage of this process because of the quality service at a cheaper cost, a lot of Americans also believe that it only limits business growth.

An In-Depth Understanding

Outsourcing is a corporate strategy that involves contracting of third party service provider to perform specific tasks and responsibilities. It allows companies to maximize resources at a minimum cost and acquire innovative ideas while increasing commitment to non-core business tasks. Apart from productivity improvement, it is also an effective tool to improve efficiency and operational performance. Moreover, research shows that this process allows local companies to spend more money to new workers and that it increases economic efficiency that results to higher wages and exports. It is equally important to understand and weigh the pros and cons of the offerings, particularly for small businesses to ensure success.


  • Reduced labor and operational costs
  • Skills, knowledge, and expertise
  • Workforce flexibility
  • Efficient project management
  • Improved company focus
  • Utilization of external resources


  • Communication risks
  • Potential security/confidentiality problems
  • Financial ties
  • Quality control

Yet despite debates about the pros and cons of this commercial trend, a recent survey shows that the BPO market will reach $202.6 billion as BPO service market is expected to grow by 3.9 percent by 2016. Indeed, offshoring will continue to change the business landscape.

Most Outsourced Services

The popularity of the services has helped many companies achieve corporate goals. There are a lot of ways to reduce overhead costs while maintaining quality service and excellent business experience. These may include, but are not limited to:

  • Customer Support. Customer satisfaction determines commercial success. It is significant not only to gain profit but also respond with clients’ needs effectively. Moreover, it is helpful to obtain access to cheaper and efficient labor while keeping high quality standards.
  • Accounting/Payroll. According to research, outsourced accounting and payroll processes can generate an accurate result of up to 99.95 percent. Apart from its cost effectiveness, it also sustains up to date payroll status through experts’ assistance and use of advanced software which helps streamline main corporate operation.
  • Legal. It is commonly known as legal process outsourcing (LPO) where law firm and/or corporation obtain legal support services from an outside law firm or company. It enables law firms to address legal issues that arise on daily basis while maintaining streamline productivity. This involves various methods, such as:

a)   Direct contact The firm that needs legal services may directly approach a third party service provider.

b)   Managed The firm establishes contact with a provider while coordinating with the vendor’s activities to ensure quality control.

c)   Required It occurs when a firm integrates a particular process, either to reduce costs or fulfill statutory requirements.

d)   Multi-sourcing It is a process that involves separation of LPO tasks to reduce risk and successfully manage multiple competing providers and ensure effective governance procedures.

  • Healthcare. The healthcare industry has gained many benefits from the BPO market. Besides medical billing, other providers also support revenue cycle process which may include, but is not limited to, appointment scheduling, insurance verification, patient demographics, claims submission, and payment posting.

In today’s cutthroat economy, it is not surprising why a lot of companies rely on offshore services. Through BPO companies, quality outsourcing services are delivered at a minimum cost. Indeed, these are another business breakthroughs.

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