It’s difficult, if not impossible, to justify outsourcing just to save money on labor. Some organizations, such as those in the public sector, find that they must outsource solely for the labor savings because that’s the only measurable way to justify the change to the stakeholders.
However, once the outsourcing relationship evolves, this arrangement can do more than save money. It can actually produce efficiencies and increase value for the stakeholders (and in the case of the public sector, the taxpayers). Once these organizations have measurable differences around productivity and additional services, those can also be reported to the stakeholders.
Businesses in the private sector can begin their outsourcing experience motivated by savings and efficiencies. How? Because they can access worldwide talent for higher-end and analytical needs. For example, Brazil has a plethora of great attorneys, engineers and scientists. Adding an offshore partner can add value around services and products that can’t be done in some regions. Businesses in the private sector can outsource the weakest parts of their company so that they can better focus on their strengths.
Source: IT Oursourcing News, February 2012
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