08.06.2022
The business practice of hiring an outside third-party to perform certain services or tasks is normally a cost-cutting measure. This is outsourcing, sometimes also called contracting out or business process outsourcing. Nowadays companies can outsource several tasks or services such as programming and application development, a full IT department, payroll services, call centres, marketing services, financial functions tasks, human resources tasks such as recruitment, and many others.
Outsourcing has brought significant changes throughout the years in the organisational chart of a company. Many prefer works to be done through outsourcing at a lower cost and ultimately the company reduces the size of the organisation. This is also the result of globalisation, changing the way a company operates.
Outsourcing is an efficient cost-cutting measure that many businesses use to increase profits and efficiency. Outsourcing started off in the 1990s and eventually became a global trade. Nowadays offloading work to third parties has become a major trend all over the world. It is standard practice that certain job functions are sent outside the organisation rather than performing them in-house as this is a way to reduce overhead, HR headaches and payroll costs.
Many firms who take over outsourced business tend to be very efficient and proficient on how to be up and running straight away without waste of time and spending many hours to gain knowledge and get a handover from that business. This is because they are aware of what questions they need to ask or perform to kick off the work immediately.
Advantages of outsourcing are many. Companies can free up resources and valuable time that can be redirected to other business projects. By farming out tasks, one tends to gain access to expertise and specialised talent, therefore enhance productivity. Furthermore, outsourcing is much easier and removes all the headaches and money spent on recruitment, training staff, payroll, tackling HR related issues and much more.
There are also some disadvantages of outsourcing, for example, if the wrong party is selected for work it may result in low quality work or delayed work. There might also be some hidden costs for outsourcing and a risk of confidential company information being leaked. Therefore, ultimately it is important to choose the right company and have the right contracts in place to safeguard oneself.
Ultimately, efficient outsourcing allows companies to gain many financial benefits. Interested in outsourcing work? Our firm, Fairwinds Management, together with its various setups can assist you with the following:
- Administration Services
- Back Office Services
- Accounting Services
- Payroll Services
- Recruitment
- Human Resources Services
- Work Permits Applications
- Legal Services
- Business Advisory
Visit our websites for more information or get in touch with our Directors today:
Mr. Conrad Meli on cmeli@accountingservices.com.mt
Ms Joceline Caruana on jcaruana@fairwindsmanagement.net
