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Advantages and Disadvantages of Outsourcing: Infographic

Outsourcing allows you to hire people to perform tasks for which you are not trained. Know its advantages and disadvantages.

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This article was translated from our Spanish edition.
This story originally appeared on Querido Dinero

You already have your company and it is renting as you expected, but you still have problems with some areas since you do not fully manage everything you need to work it correctly.

Querido Dinero
https://www.queridodinero.com/articulos/8-pasos-para-hacer-home-office-sin-bajar-la-productividad

For this, there are people and corporations that can more profitably manage certain parts of your company, achieving a more effective and efficient performance. This is where outsourcing comes in, which in simple words implies hiring a specialized agency or firm that will take care of that area in which you are not fully trained and that takes away valuable time.

With this type of advice, you would only focus on the central function of your business and would delegate internal functions or activities of your company to an external provider, which has the knowledge, experience and resources to execute them.

Either way, you need to be clear about the advantages and disadvantages of hiring a service of this type. Here is the listing.

Advantage

  1. Manufacturing costs decline and investment in plant and equipment is reduced.
  2. It allows the company to respond quickly to changes in the environment.
  3. There is an increase in the strengths of the company.
  4. It helps define the company.
  5. Increase commitment to a specific type of technology that improves delivery time and quality of information for critical decisions.
  6. It allows the company to have the best of technology without the need to train organizational personnel to handle it.
  7. It allows to have information services quickly considering the competitive pressures.
  8. Increase in the flexibility of the organization and decrease in its fixed costs.

Disadvantages

  1. Stagnation in terms of innovation by the external company.
  2. The company loses contact with new technologies that offer opportunities to innovate products and processes.
  3. It is possible that this external advisor will use the knowledge learned in your company to start his own industry, and become your competitor.
  4. The cost saved with the use of outsourcing may not be as expected.
  5. The fees increase the difficulty of re-implementing activities that could once again represent a competitive advantage for the company.
  6. High cost in the change of supplier in case the selected one is not satisfactory.
  7. Reduction of benefits.
  8. Loss of control over production.