Does Outsourcing Decrease Cost? See How It Does

In this advanced era of business, outsourcing has become one of the most effective techniques to save cost and time. It is used broadly in today’s digitalization world as outsourcing reduces cost. The developed countries favor the process of outsourcing from developing countries like Pakistan. In this blog, you will come across the different aspects that show outsourcing reduces cost. Before going into more discussion, you first need to know the real meaning of outsourcing.

Outsourcing is the process in which organizations and companies hand over to external vendors. Any task that can be handled by a third party or external company can be outsourced easily. This process is also called offshore outsourcing allows the company to get superior quality services at a minimum operational cost.

There are three wider categories of offshore outsourcing:

Infrastructure and Technology Outsourcing: it caters to the services associated with networking and technology.

Business Process Outsourcing BPO: it caters to the services associated with the back office and front office.

Software Outsourcing: it caters to the services associated with the development of software services.

Outsourcing is a good option for processes such as inventory management, customer care support, payroll, and much more. Many of the call centers outsource their work. You can go for outsourcing for editing services, image manipulation services, content writing, data entry, and transcription and data conversion services.

Pakistan is among the top countries facilitating efficient offshore outsourcing services to their customers; it offers services in almost all the areas of outsourcing. Other countries except for Pakistan which is successfully working in the field of offshore outsourcing include Russia, Egypt, China, and so on.

Why And When Do We Need Outsourcing?

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Outsourcing is one of the best tactics that enables one to focus well on the core area of the business. Indeed, outsourcing reduces cost, if you want to assess the need for outsourcing for your business then ask this question to yourself regarding your work:

  • Do all the resources are being utilized to their fullest efficiency?
  • Are you working for the best prices?
  • Do you have the advanced resources available that support the upcoming technology and fight the market competition?
  • Do you have any other successful way to manage these processes more instantly and professionally?
  • Do you have sufficient professional expertise to provide efficient work?
  • How can we reduce the training and recruitment cost? Outsourcing reduces cost

Perks Of Outsourcing Other Than Outsourcing Reduces The Cost

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Have you ever thought about why outsourcing has become such a popular area for diverse businesses throughout the globe? The foremost reason for this is due to the various benefits connected with it. Following are the most noticeable benefits of outsourcing:

1.    Outsourcing Reduced Cost

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It is considered the most significant benefit of outsourcing as it allows one party to get the work done at a very low cost more efficiently. There is a broad difference in the patterns of pay scale between the developing countries and western developed countries. The kind of work that is done in the west for the greater price can easily be obtained at much lower prices in developing countries such as Pakistan. The differences were observed up to 60%.

2.    Outsourcing Provides A Superior Level Of Effectiveness

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Keep in mind that it is true that outsourcing reduces cost but it enhances the efficiency and quality of the work. It is handed over to people or companies who have greater knowledge of the word and have much experience in this particular area. This aspect automatically enhances the standard of the work and can be accomplished in a faster and more efficient way.

3.    Outsourcing Saves On Investment

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If you are outsourcing then you do not need to spend expenditures on developing infrastructure. In the outsourcing process, the partner who is getting responsibility for the work makes important infrastructural updates according to the requirement of the work.

4.    Outsourcing Helps Cost-Cutting On Training And Recruitment

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When a specific kind of work is outsourced, then his organization does not need to hire dilled people from it. You would need to arrange any kind of training programmers for something. The task will be handed over to people who are already specialized in that work. This process brings higher quality and efficiency to the work.

5.    Around The Clockwork

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Outsourcing has the amazing time-zone benefit. There is a difference in the time setting of the other countries where the work is outsourced. To enhance, if an American company assigns the process from Pakistan, there will be a huge gap between the zones of both countries. So in that case, one can assign the work and relax; the work will be performed by the time when the morning occurs in the other country. Outsourcing reduces cost. This system is also great for the off days.

6.    More Rapidly Results

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If you are willing to do everything by yourself then it may affect the efficiency of the organization, as many things need attention. But when you are outsourcing the function or work, you find it easy and beneficial as part of the burden is contributed with your outsource partner. Outsourcing reduces cost. This allows instant and rapid development of ideas into concepts and also facilitates better delivery of the ideas, products, and concepts into the competitive market.

7.    Defeat Fluctuation In The Workforce

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Most of the time there are changes in the workforce when there is the least availability of workers to work on the assignment. Outsourcing reduces cost. This occurs especially at the time of the festive seasons and holiday seasons. Outsourcing the work allows you to control the problem, as you can be connected with the partner around the clock to work on the assignment.

8.    Top Talent

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In the established countries, particularly skilled workers are scarce, also there is a deficiency or they are available at a very much greater cost. However, outsourcing the work in developing countries allows access to a great number of skilled people who are proficient and efficient in the English language. You can have your work at a very low labor cost. Outsourcing reduces cost.

9.    Outsourcing Helps Risk Management

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It is the hidden perk of outsourcing that allows companies to avoid any problems occurring due to technical crises, market fluctuations, or natural calamities. Outsourcing reduces cost. Then the offshore outsourcing partners can allow you to keep working on their responsibility. It is especially great for bringing the company back on track.

Key Points To Follow

Outsourcing now prefers by the leading mantras for business tycoons around the globe and is also well appreciated for its unlimited benefits. One needs to be conscious of outsourcing one’s work. Different things are required to be kept in mind for outsourcing any kind of work:

I.          Security policy

If you desire to outsource the particular works and functions to other partners. Then you should have a rational and strong security policy for backup. Outsourcing reduces cost. Security policies are supposed to take care of data classification that can discriminate between common and sensitive data. The managers and authorities of the company should establish transparent policies to set up standards and guidelines for the data security and work process.

II.          Assortment of outsourcing partner

The variety of the appropriate outsourcing vendor or partners is very significant. The partner to whom you want to get your work data should be very much loyal to you. It should be able to strictly follow all guidelines and security policies of the organization. He should make sure that there will be no data copies and leaks from the other side.

III.          Protection of data

Before starting the process of outsourcing from any vendor, you should develop techniques and ways to keep an eye on the database. Outsourcing reduces cost. It should also opt for an application that would secure the data from getting tempered. Devices like firewalls and others should be used to avoid any abuse and exploitation of sensitive vulnerable.  As well ensure that your outsourcing partner is also following such security software and techniques to prevent the bad use of the database.

IV.          Training

What next should you make sure of? Ensure that the people who are going to work for you from the hired external party are well trained and have proper knowledge for the tasks. They should be familiar with the techniques and applications regarding how to protect and manage sensitive data. Ask your vendor to provide regular training and skill up-gradation for these employees timely. Outsourcing reduces cost. Significantly, the team of the vendor is well updated with the advanced privacy and security tools to secure the data of the company.

V.          Supervising

Before outsourcing any data to your partner, establish methods and strategies for regular monitoring for the vendor company and its employees. Also, keep in mind that never offers access to all the data to them before building complete trust with them. Make it a step-by-step process that should be monitored very carefully for any tampering and leaks, efficiency, and quality of the data.

VI.          Ensure Security audits

It is most important to conduct regular data security audits. The audit will help you to bring to light the issues and loopholes regarding data security. It will also recognize vulnerable database applications which can hamper the company entirely. This will facilitate the process of identification of the gadgets which may become a threat to the security of the database. Timely security audits will help in the development of more efficient security guidelines and measures.

VII.          Avoidance Technology

Do not forget this point before outsourcing any tasks to the partner, search for what type of prevention technology they use to keep their data secure, what methodologies and strategies they follow to prevent tempering a leakage of data, and much more. Search for the technologies they use to avoid sensitive data from getting copied or emailed through devices such as spend drives, power banks, and so on.

The following methodologies will make the sure establishment of a long term relationship with the outsourcing partners:

  • Strategic tasks should be undertaken. The company should discuss all the operational problems with their outsourcing partner. Outsourcing reduces cost. To ensure smooth and easy functioning of the work, for this aim a particular person should be assigned to take care of this aspect.
  • Daily basis meetings should be arranged between the two parties to perform away from the problems and loopholes which slow down the efficiency of the work.
  • Your partner should use modern technology like the internet, email, and many more for communication and management
  • It should make sure that every worker of the company and the partner organization is aware and understands his role and responsibility properly. They should also know how their performance affects the entire success of the company.
  • The company outsourcing the process should establish strategies and methods to motivate the workers of the partner organization and should also incentivize them for their amazing support and performance.
  • The organization outsourcing the work should develop strategies and ways to motivate the employees of the partner organization, and should also reward them for their outstanding performance and support.
  • Both the partners and the agency should have a clear understanding of the handling of the change. What and how will they adapt to the update regarding who will play what role in the process. Outsourcing reduces cost.
  • And the most essential thing is that the company should properly handle and nurture a cordial and long-term relationship with their vendors or partners. This can be accomplished by respecting and appreciating the contribution created by the partners in the entire development of the company.



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It is also called offshore outsourcing and is the process in which a firm hires an external organization or partner to perform some part of the functions. It’s completely appreciated because it decreases the burden of the outsourcing company to some extent and they can focus and concentrate on their main functions. It also supports the organization to get successful services at a low cost. It also decreases costs on training, infrastructural development, and recruitment. Outsourcing reduces cost. It allows the company to take the services of greatly experienced and well-trained experts to implement their work more effectively and efficiently.

Even though outsourcing the work has unlimited benefits, you need to be more careful while outsourcing their work. Metrics should be taken to choose the right strategies and vendors. Methods should be developed to protect the database of the company and to check any kind of data tampering or leakage. Methods are also needed for supervising the data flow process and the workers of the partner. It is also vital to maintain a long-term relationship with the partners.

In The Nutshell

You can do this by managing regular meetings, conversing operational problems, and making management strategies. The organization should establish different ways to reward and motivate the outsourcing partner and their workers for their positive support and performance. It should concentrate on upholding a durable relationship with its customers. Outsourcing reduces cost. It is thought that offshore outsourcing is a significant aspect that brings the success of any business in the world market.

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