Offshore outsourcing is the process of contracting business processes to other companies or freelancers based overseas. Offshore outsourcing has been successfully carried out on different processes including customer service, technical support and data entry. The internet, as well as access to high speed network infrastructure in more and more countries, has made outsourcing to other countries possible. Highly skilled personnel can be engaged at a low cost from anywhere in the world. The companies that use such a business processing outsourcing service lower their operating costs and are able to focus on other aspects of their business.
Offshore outsourcing has mainly taken up four main business processes. First is Information Technology Outsourcing where a company’s information technology is outsourced overseas. The second major business processing outsourcing service is call center management. The third is Research and Development while the fourth is knowledge process outsourcing. Knowledge process outsourcing is simply a special type of outsourcing that requires the use of highly knowledgeable experts in performing a task.
Opponents of offshore business processing outsourcing service have touted it as a bad way of doing business that depresses a country’s wages. Work is sent to other countries at rates that are much lower than those of the originating country. Workers in the company outsourcing its services stand to lose their jobs. This in time and on a large scale can affect the economy of the home country negatively. The use of a business processing outsourcing service has also been criticized as the cause of a decrease in service and product quality. Language has also been one of the greatest barriers and is still a major obstacle companies in an outsourcing relationship have to deal with.
Those that support an offshore business processing outsourcing service argue that offshore outsourcing has not only lowered the operational costs of the companies that use this service but have subsequently maintained or lowered the costs of the end product. Companies that have used such services have found that outsourcing jobs has increased their profit margins not only because of reduced expenses but also due to the ability to better focus the company on activities that can and will drive profits. Offshore outsourcing has allowed numerous jobs to be created in the countries where the outsource service provider is based. There is no doubt that offshore business processing outsourcing service providers are here to stay.
Daven Michaels Author of the book Outsource This!