A most misunderstood word is perhaps the word Outsourcing. As soon as someone mentions outsourcing, people think of low-cost labor in another country. Outsourcing is not a new phenomenon. We've outsourced forever by sending work to smaller alliance firms or partners with whom we've had an agreement of referrals or taking on work that is overflow work. All outsourcing means is working with another team to get the work done.

Outsourcing can be done for several reasons:

• to leverage a skill set that may not be readily available in-house
• to add a new revenue stream for related products or services to the company's core competencies
• to send smaller projects or overflow that make no sense being handled in-house
• to get a less expensive resource who can work on a contract basis or short-term basis to help on a project by project basis
• and so on...
  

Then there's offshoring which is different than offshoring. You can outsource in your own city without the need to offshore. Offshoring allows companies to leverage even lower-cost resources, a more readily available infrastructure, and streamline processes by sending non-core functions to someone who can handle it better, cheaper, faster.

Most people think that the only value of offshoring and outsourcing is the lower cost labor involved. That's not true although that may be one dimension and it may even be the primary reason for the decision to outsource.

Companies who do better by tying the offshoring decision to not just cost reduction but also process improvement and leveraging economies of scale.

And in all these transactions, level-setting expectations of what the outsourced or offshore partner is promising versus what the client thinks he or she is getting is perhaps the most important dimension.

An outsourced consultancy like ours can help with the entire process of determining what to outsource, whether to outsource and offshore, what kinds of skills will be necessary in your offshore and outsourced partner, and managing the entire offshore and outsource delivery process. Contact us today to learn more about our services and how we can help you as you venture down the path of outsourcing and offshoring.