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If you have been outsourcing in the past or are planning to start soon, and are worried if it can survive the test of the time, you may put your worries to rest. Outsourcing will definitely survive in the future.

Read on to know how to survive the outsourcing crisis, and the future outsourcing trends.

How Outsourcing Started - A Brief Recap

Outsourcing has certainly revolutionized how businesses operate today. When outsourcing first started out, it was restricted to low-risk functions such as payroll processing and data entry. Later, contact / customer service operations were outsourced on a large scale.

This brought outsourcing cost benefits to the forefront, and organizations started taking notice. Global companies who wanted to leverage the cost benefits of outsourcing started outsourcing high-end functions like IT services, healthcare BPO and research services to reliable companies. Today outsourcing is no longer a buzzword only for the low cost labor. It has become a key business strategy for both small and large business enterprises who believe in devoting 100% to their key business operations and outsourcing the rest to specialized vendors.

In the recent past, outsourcing has brought in a lot of businesses opportunities for countries like India, China, The Philippines and Mexico to name a few. India is perhaps the biggest beneficiary of the outsourcing boom, and over the years, has created a niche for itself in IT and ITES outsourcing. A large majority of IT companies prefer to choose India, when it comes to outsourcing due to the presence multi-talented pool of affordable resources, timeliness, and reliability.

The Outsourcing Debate - To Outsource or Not

While most companies across the industry verticals swear by the advantages of outsourcing, the outsourcing debate continues over its long-term sustainability. Outsourcing opponents argue that the flip side of outsourcing includes lack of quality control, lack of hold on the project management, and lower prospects of innovation. Outsourcing critics point out that rising salaries, in outsourcing destinations like India, is taking the sheen away from outsourcing and thus it may not be as profitable in the long run.

Despite such perceived negative aspects, outsourcing has only continued to grow. In fact, outsourcing is now being embraced by organizations of all sizes and domains. From startups to large enterprises, outsourcing continues to be a tool of choice to gain competitive advantage in the business scenario. Businesses are moving over to multiple platforms - cloud, social, mobile etc., stakeholders are getting geographically distributed; in such a disparate environment, outsourcing has been able to conveniently adapt to rapidly changing business environments.

Crunch business situations have only helped to build the case for outsourcing further. The recent global economic crisis is the testament to the fact that businesses not only need to learn how to survive during a downturn, but also need to look at newer ways of overcoming weak economic conditions. In the current business scenario, it is all about "outsource and survive", and efficiently managing your outsourcing projects and staying ahead in the competition.

Outsourcing Trends for the Future

  • Outsourcing relationships are now more standardized, and process and people driven rather than price driven. This change is believed to level the playing field for outsourcing service providers in the future
  • Cost pressures will pave the way for custom outsourcing contracts that are flexible in their SLAs (Service Level Agreements) and scope of delivery
  • Small businesses, startups and SOHOs will witness a higher adoption of outsourcing in order to reduce the operational inefficiencies and increase their time to market
  • Rising raw material, transportation and oil costs will make it important for companies to look at outsourcing in order to keep their operating costs low
  • More high-end critical business functions will be outsourced in the next decade, while outsourcing of low-end services will stabilize
  • Latin America and Europe might provide stiff competition to India as the favored outsourcing destination
  • As businesses move towards cloud outsourcing; support and development will increase
  • Manufacturing and Pharmaceutical businesses will move to cheaper destinations, such as India to take the advantage of low labor and operating costs. Additionally, research and development outsourcing in these industries will also tap into the vast outsourcing potential of India

Will outsourcing survive in years to come? The answer is a definite yes. Outsourcing will continue to survive in the future, as it provides companies the access to specialized skills and save on time and effort, which can be channeled into the other core business ventures.

Are you ready to take the next step in outsourcing? Contact us at Flatworld Solutions to discuss your requirements and get a customized outsourcing solution.

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Flatworld Solutions

116 Village Blvd, Suite 200, Princeton, NJ 08540


Aeon Towers, J.P. Laurel Avenue, Bajada, Davao 8000

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