Error processing SSI file
Error processing SSI file
Beating the Resource Barrier
by Jit Agarwal

Many organizations have tried outsourcing, as a mechanism to increase a corporation's resource base, and almost all are familiar with the concept. In some cases experiences with outsourcing have been positive; in others the exact opposite is true. Those corporations, which have successfully leveraged outsourcing in their organizations, have often utilized it to fulfill similar needs. This article explores three areas of need where outsourcing can provide the most value-add.

1. Leverage an Experience Base: Utilizing resources with a rich background in the particular area you are focused on can help you beat the resource barrier. One of the potential benefits of leveraging this experience base is acceleration in time-to-market. If the outsourcing partner has a deep understanding of the subject matter in question, they can often hit the ground running. This enables the partner to provide results much faster than other resources, which may be available, but require significant ramp-up time. In addition, an outsourcing resource, with a history of providing services in the market, may have substantial prior experience enabling them to help you avoid pitfalls or blind alleys. This can be especially useful when charting unknown territory or new product offerings. Avoid having outsourced resources develop innovative concepts; as they may not be around to help you take advantage of that innovation in the future, or you may want to keep the related intellectual property and its development process as a corporate asset.

2. Satisfy Needs Outside of Core Competencies: Another way outsourcing can help beat the resource barrier is by meeting organizational needs in areas outside the company's core competency. Using outsourced partners to provide services in non-strategic areas enables your organization to stay nimble and focused. The specific definition of what is non-strategic will differ from company to company, but an example might be facilities or grounds management. Other non-core competencies often outsourced include call centers, business processes, IT operations, and other largely repetitive and labor intensive operations. Keeping the focus of outsourcing in areas outside your core competency will ensure high value add without creating potential future conflicts for your organization. An additional area to utilize outsourcing is for one-off projects or activities. These types of activities, while often necessary, are a resource drain on your organization. Leveraging outsourcing to cover these areas will conserve corporate resources to focus on areas core to your success in the marketplace and still accomplish the objective at hand.

3. Realize Cost Efficiencies: Finally outsourcing can help beat the resource barrier by focusing on areas where the corporation's cost of doing business can be dramatically reduced. Taking advantage of outsourced partners to substantially cut costs and improve operations is not only possible, but also smart business. Not all organizations will be able to cut costs in the same area, but many are finding areas that require the greatest scaling in their organizations, like call centers, processing centers and other areas, can often be good targets for outsourcing. Using a vendor enables you to leverage that vendor's economies of scale, investment and operational expertise. You can effectively get a better level of service and provide that higher level of service to your customers, all for a cost below your current spending level. In addition, by outsourcing non-core functions you not only save on direct payroll and investment expense, but you also save on indirect, hidden or additional over head expenses. These types of indirect cost savings often go directly to the bottom line as they eat into profits and don't contribute towards driving revenue.

Outsourcing can effectively scale your resource base and add value to your organization. If one of the tips mentioned above enables you to more effectively leverage outsourced resources, then it may help you complete more items on your endless "to-do" list.

Error processing SSI file