Why are more and more companies opting for outsourcing?

Let’s start by defining what exactly this concept is. The word outsourcing literally means “outsourcing” and refers to the practice of companies contracting services provided by other companies. It is also known as staff augmentation, outsourcing or subcontracting.

This practice is widely accepted globally and has grown enormously during the pandemic due to remote work.

Basically, one of the purposes of outsourcing is to expand business operations without having to hire permanent personnel who may be located anywhere on the planet.

It is a quick solution that provides great value to the company since it solves multiple problems within companies without the need to make changes to the structure itself or hire full-time staff.

Many companies abroad are leaning toward outsourcing their IT departments to Latin America, India, the Philippines, etc.

One of the main problems is that currently many foreign companies only see outsourcing as a synonym for cost reduction.

While in the short term it may seem like it does, and sometimes it actually represents a big drop in expenses, in theory, outsourcing should focus much more on attracting valuable talent beyond the geographic boundaries of the company.

Likewise, outsourcing teams helps add external perspectives to complement the internal vision of the organization, and be able to scale operations quickly without having to go through selection processes that require months and months.

In short, if the only variable at play when outsourcing is costs, this will directly impact the quality of the outsourcing company to hire.

This situation directly translates into an immediate reduction in costs, but also implies a higher cost in the long term due to the need to repair what was damaged.

In the corporate world as we know it today, successful companies do not compete only on costs, they do so on talent, corporate culture and innovation.

And, to achieve this, you must have motivated collaborators, a corporate structure based on mutual trust, and a clear purpose. Cultivating these 3 pillars is vital to achieving a low turnover rate (which is one of the main challenges for companies), along with retaining staff and attracting collaborators who are aligned with the business culture.

When to know when it is time to outsource services?

Many companies find themselves in the dilemma of being able to identify when it is necessary to hire an outsourcing service.

Sometimes it is tempting to outsource services instead of hiring full-time staff due to the speed of the solution, but each company needs to analyze its own situation and based on that make the best decision for that moment.

A good guide to know if staff augmentation is an interesting alternative is to ask the following questions:

• Is productivity stagnant because specialized personnel are needed in some process?
• Are investments of time and money dispersed in tasks secondary to the core of the business?
• Do non-strategic areas create problems that affect internal workflows?
• Is it necessary to incorporate technology to optimize processes and improve the level of talent in the technological field immediately?

Whether or not the practice of outsourcing applies to the business need deserves a separate chapter, as well as all the precautions that must be taken into account before hiring this service.