Outsourcing was born out of necessity to stay competitive in today’s ultra-aggressive and ever-changing business environment. Sometimes a company chooses to outsource because of the lack of talent. Another reason could be to save money. Regardless, there are many legitimate reasons for partaking in outsourcing. Thus, here are 5 different approaches to outsourcing in the tech industry today.
Alone we can do so little; together we can do so much. – Helen Keller
1. Offshoring
This refers to acquiring a virtual team or company outside the boundaries of your nation or country. Offshore tends to be an operative process that creates a leverage system for big tasks that is both cost and time-efficient for the company. This approach to outsource is extremely popular because of its potential to tap into talent in other regions, skip restrictions on national grounds, and reduce expenses in labor.
2. Nearshoring
The main characteristic of nearshore outsourcing lies in the location. Without a doubt, the location in this regard is chosen to acquire talent to help you with your outsourcing projects and is focused on neighboring countries and regions. This creates an environment where speed, communication, and accuracy are far better than the traditional offshoring service. Time zone issues become a nonfactor with nearshore because both the nearshore company and the company inquiring about the services will be located in the same time zone. Another pro to this kind of outsourcing is the cultural commonalities stemming from the close proximity of both companies and countries.
3. BPO
This acronym stands for Business Process Outsourcing. It does not focus on the cost-efficient development methods based on distance like the majority of outsourcing methods listed in this article. Instead, it focuses on supporting administrative activities such as human resources, accounting, finance, and customer service. The organizations that require this method to outsource are more inclined to focus on research and development. Consequently, they employ the use of BPO for administrative work. In fact, one of the most popular forms of BPO is customer support call centers in India.
4. Reshoring
Hiring expenses in Asia have increased in the last couple of years. So many companies are on the lookout for replacements on national grounds that can give them the same boost in personnel, while also benefiting from the same time zone and work culture. Reshoring exists as an option to fight unemployment and shorten the steadily increasing costs of working offshore.
5. Staff Augmentation
Staff augmentation is considered a strategy to respond to specific business objectives. Accordingly, these objectives are manned with talented teams and individuals that can bring value to the end result. Thus, this approach is highly recommended for any company executives looking for breathing room. Indeed, key operational activities can be given less focus and more focus can be given to strategizing.
Therefore, the effects of outsourcing on companies differ from one another since scale, volumes, and verticals make the outsourcing environment change dramatically. For the best nearshore, offshore or BPO services, look to Mexico as the first choice, closely followed by Argentina and Colombia.
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