Outsourcing Increases Productivity

In recent times, outsourcing has received a bad reputation in the consumer market. Consumers equate it with sending jobs overseas and increasing our unemployment rate back home. There is, of course, some truth to this belief, since many functions that used to be located in the American offices of many companies are now being produced in foreign countries, either by employees of a branch location of an American company or by a foreign company using its own local employees.

However, much outsourcing stays right here at home. All modern companies outsource to some extent. Purchasing raw materials or manufactured parts from another company to be used in a final product in your company is outsourcing. Outsourcing occurs with hard goods as well as with services. Using an outside accounting firm instead of an employee of your company or an attorney who is not your employee is outsourcing.

Outsourcing should increase your productivity. It allows you and your employees to focus on what you do best and contract with outside sources for items/services that they are better positioned to create/provide. What you obtain from outsourcing should be at a lower cost to you (including those hidden costs we’ve talked about in previous blogs) than doing it yourself, allowing you to make a greater profit with fewer in-house resources.

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