Outsourcing has many advantages but at the same time it has some disadvantages that cannot be ignored. So let us look at some outsourcing pros and cons.
Pros of Outsourcing
Outsourcing as a trend has come into major scrutiny by the workers and media alike in the developed countries. But most economists are sure that this condition is just a temporary one and will die down as conditions develop and people start taking a mature outlook towards outsourcing. The Outsourcing advantage lies in the fact that it helps companies cut costs and stay ahead in the competition. Outsourcing also benefits the citizens in developed counties as it provides high quality products at a cheaper rate also with better customer service.
Advantages of Outsourcing
- Companies can save up on operational costs. In fact most companies can cut their operating costs to half by outsourcing
- Get access to cheaper and more efficient labor
- Cut up on labor training cost
- Get access to better technologies at a cheaper cost
- Increase productivity
- Concentrate on core competencies
Disadvantages of Outsourcing
- The company that outsourcers can get into serious trouble if the service provider refuses to provide business due to bankruptcy, lack of funds, labor etc
- Outsourcing requires the control of the process being outsourced by transferred to the service provider. Thus the company may loose control over its process
- The service provider in developing countries generally services many companies. So there are many chances of partiality owing to more payment by other parties
- The current employees in the company that outsourcers may feel threat due to outsourcing and may not work properly
- he attitude of people in the developed countries against companies that outsource is generally bad
