BUSINESS PROCESS OUTSOURCING
BUSINESS
PROCESS OUTSOURCING
Outsourcing means getting a
business task accomplished through an outside agency. It involves employing an
outside agency to manage, operate and deliver one or more business activities,
processes or functions. Modern business houses are too big in size, number of
employees, area of operation and volume of business. Therefore, they are quite
unable to attend all aspects of business with same level of interest and
seriousness. Thus, they opt for outsourcing general works, by keeping crucial
aspects of business under their own control and supervision. Financial
services, advertising, transportation of employees, after sales service etc.
are the usual areas which outsource by companies.
• Outsourcing enables the business to concentrate
on core business activities.
• Business units can easily avail the expertise
and specialist knowledge of such agencies at low cost.
• Business need not invest anything to get the
works done through outside agencies.
• Business unit is relieved from the problems of
recruiting and maintaining specialist personnel for the purpose.
• Outside agencies are specialists in the field
and they can offer better services. This will increase quality of output and
thus the profitability.
• Business unit can formulate plans and ensure
timely implementation of them.
Scope of Outsourcing
Scope of outsourcing means,
different areas and services outsourced by business units. They are:
Financial services
Financial service means all
functions and activities relating to collection and accounting of financial
resources of a business. It includes managing issue of shares and debentures,
payroll accounting, collecting accounts receivables, maintaining books of
accounts etc. Merchant banks and issue houses are doing such services for other
companies.
Advertising Agencies
Here, business units entrust
outside agencies who are specialists in advertising to make advertisements for
them. Such agencies keep experts who can design advertisements and, maintain
good contacts with media, models and other technical and professional people
who can make advertisements effective and impressive.
Courier Services
Courier service means postal and
parcel services provided by private firms. They carry letters and parcels at
lower rates. They usually deliver these quickly and safely even out of
office hours. Another advantage is that they collect letters and parcels
from the place of sender and supply them at receiver’s place. They carry heavy
and light articles alike.
After Sales Services
Now, after sales services are parts
of marketing activities. Business units engage outside agencies to render these
services to their customers. Regular servicing, repairing etc. are entrusted to
these agencies as part of outsourcing. Producers and sellers of house hold
durables (TV, Refrigerator, AC, Computer etc.) and suppliers of machineries are
commonly availing services of such agencies. This kind of outsourcing is
benefited by both companies and customers. It is beneficial to customers
because their services will be available to customers at their own places. For
the company, it ensures better sales and expert services to its customers at a
cheaper rate.
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