The Coronavirus pandemic has changed the normal into a privilege that is no longer possible without the discovery of the vaccine. As the usual lifestyle of people has changed by including many safety precautions in their schedules, companies are also forced to change their organizational structure. Lockdown of businesses and halt in business activities had forced many companies to redundant employees or offer flexible working conditions.
But the main question that remains is how businesses will function post the lockdown period?
Remote hiring or remote recruitment refers to a work position that has the same description as a position offered through the office but requires employees to work from home. Regardless of the location, the work has to be carried out away from an office or company premises.
This type of work position has been practised by many companies but on a very small scale. Due to the pandemic, many companies had utilized this practice. Although it was a sudden decision and many were unprepared, companies managed to implement work from home on a larger scale. This has given companies a chance to evaluate advantages, problems, benefits and the schedule of the work process if a large fraction of the workforce is on remote employment.
What is Outsourcing?
Outsourcing is a practice used by companies where they hire a third-party to execute tasks and projects that are normally done by the company. The third-party is usually contractors, freelancers or a large outsourcing organization located out of a company.
Companies can outsource services such as:
Bookkeeping & Accounting Services
Social Media Marketing
Programming & Application Development
Outsourcing can come in various forms and types. From IT outsourcing to manufacturing outsourced, it has a wide range to offer. Following are three basic types of outsourcing that business may want to consider depending on the location of where the services are outsourced from:
Onshore Outsourcing: This is when tasks are assigned to be outsourced from a low costing location which is situated within the same country as the company. Businesses implement this practice when they want to reduce employment costs.
Offshore Outsourcing: This is when tasks are assigned to be outsourced from a different country other than where the company is located. Companies tend to gravitate towards this form of outsourcing the most as it is the cheapest.
Nearshore Outsourcing: This is when tasks are outsourced from companies located near the existing company. Nearshoring is another form of outsourcing that makes it easier for the two parties to communicate in terms of distance which can be an obstacle in Offshoring.
How does outsourcing benefit companies?
Most companies in the world are profit-driven, therefore they are always finding ways to decrease costs while aiming to increase efficiency. Outsourcing is one of the ways companies implement to reduce costs. But what are other benefits of outsourcing for a company? Following are the four most important advantages for a company to outsource:
The most popular reason for outsourcing is the low cost of employment. Due to reasons such as wage differences between countries or lower manufacturing costs, cost advantage is gained by businesses that opt for outsourcing. Asian countries are known for offering cheaper labour costs compared to other western countries. As the workforce is skilled, lower cost does not mean poor work quality.
Capital cost is also reduced as no equipment, workspace or other additional facilities have to be provided for the outsourced work. It also reduces the fixed cost of a company such as building rental, water and electricity used to operate workspaces for employees.
Improved Work Efficiency
Outsourcing companies have been providing services in that particular sector of business for a long time. As they gain more and more experience, the quality of work improves. Therefore, due to their experience, they can provide better service compared to a new business that is very fresh to everything. Good quality of work means increased efficiency which will result in more success for your business.
Additional Access to Expertise
When companies employ new talent, they have to go through the recruiting process and receive training for the work position. These procedures are very expensive and time consuming for companies. Outsourcing lets companies skip these steps and have access to skilled resources. Outsourcing companies have already trained and assessed their skills making employees the perfect candidate for your task.
Better Allocation of Time & Resources
Outsourcing provides many competitive advantages to companies. Other than cost, companies are also able to save time and resources that were invested in tasks that are to be outsourced. Instead, use it more towards investing in the future success of the company and spending more time on research and development.
Outsourcing is the new ‘normal’ for companies after the COVID-19 pandemic?
Outsourcing was gaining its momentum before the pandemic however, its outlook has changed after being hit by the Coronavirus pandemic. Outsourcing is no longer only a cost-saving or gaining additional expertise strategic tool used by companies. But rather a great option to continue business operation while keeping the working environment safe. The remote working practice is also very popular in outsourcing companies.
Through outsourcing, companies will be able to gain a competitive advantage over competitors. Businesses chose to outsource to reduce costs and increase work efficiency. With upcoming economic trends and changes, outsourcing is appearing to be a very popular option for businesses to operate. As more and more companies chose to outsource their work, find out if outsourcing can benefit your company and you.
For more staffing solutions, contact Venus Consultancy