Outsourcing

1. BY-
Kiran Kendre

2.  What is Outsourcing?
 Key Driver
 Risk of Outsourcing
 Disadvantages of Outsourcing
 Type of Outsourcing
 Outsourcing Relationship
Management(ORM)

3.  Outsourcing - “the strategic use of outside
resources to perform activities traditionally
handled by internal staff and resources” Dave
Griffiths
 Why Outsource- Provide services that are
scalable, secure, and efficient, while
improving overall service and reducing costs
 When Outsourcing- When a partner could
provide a capability more effectively than the
company could itself

4.  InformationTechnology/IT solutions
 Call Centers
 Finance & Accounting Outsourcing
 Procurement Outsourcing
 Textiles
 Manufacturing
 Human resource Management

6.  Cost Effective
 Specialization
 Skilled Expertise
 Time zone difference
 Focus on core competencies
 Increased productivity & Efficiency
 Distribution of risk
 Improving customer service
 Better people management
 Access to world-class solutions

7.  Loss Of ManagerialControl
 Hidden Costs
 Threat to Security and Confidentiality
 Quality Problems
 Tied to the FinancialWell- Being of Another
Company
 Bad Publicity and Ill-Will
 Lack of customer focus
 lose talent inside within your company
 Linguistic barriers

8.  Loss of Control
 Increased cash outflow
 Confidentiality and security
 Selection of supplier
 Too dependent on service provider
 Loss of staff or moral problems
 Time consuming for project management
 Provider may not understand business environment
 Multiple contract
 Provider slow to react to changes in strategy
 Vendors wont be in a position to understand all of the
client organization’s relative problem

9.  Business process outsourcing (BPO)
 Knowledge process outsourcing (KPO)
 Legal process outsourcing (LPO)
 Recruitment process outsourcing (RPO)
 Engineering process outsourcing( EPO)

10.  BPO is a subset of outsourcing that involves the
contracting of the operations and
responsibilities of specific business functions or
processes to a third-party service provider
 Horizontal BPO: function centric outsourcing
Ex: Automatic Data Processing (ADP)
 Vertical BPO: proving various functional
services in a limited number of industry domains
Ex: Healthcare, financial services,
manufacturing and retail

11.  KPO describes the outsourcing of core
business activities, which often are
competitively important or form an integral
part of a company’s value chain.Therefore
KPO requires advanced analytical and
technical skills as well as a high degree of
proprietary domain expertise

12.  LPO refers to the practice of a law firm or
corporation obtaining legal support services
from an outside law firm or legal support
services company.This process has been
marked by the practice of outsourcing any
activity except those where personal
presence or contact is required.

13.  Recruitment Process Outsourcing is a form of
business process outsourcing (BPO) where an
employer outsources or transfers all or part of
its recruitment activities to an external
service provider.

14.  EPO offers global consulting and outsourcing
services providing end-to-end services in the
areas of Engineering andTechnical Process
Outsourcing.

15.  Staffing Model :Staff member with duration,
closer monitoring
 Fixed Price model: price decided at start
 Variable price model: pay for
additional/higher functionality
 Time and material model
 Shared risk and reward model

16.  Keeping relationship between key
management personnel
 Well-defined criteria and Quantifiable
objectives
 Developing special board of members
 Incentives and Penalties
 Periodical review meetings
 Training vendor personnel
 Understanding the cultural differences