How International Outsourcing Can Help Your Company Grow

By Ken Zwerdling on Oct 08, 2017

How International Outsourcing Can Help Your Company Grow

Do you have crucial members of your staff spending too much time on routine tasks? If you do, you are not alone. Many businesses in the same boat have discovered that international outsourcing allows these vital employees to spend more time on strategic core areas. Delegating tasks of lesser importance allows businesses to become much more productive.
 

1.Human Resources Outsourcing (HRO)

Many businesses are beginning to see the benefits of outsourcing various human resources functions. Common human resources services that are easily outsourced include: background checks; temporary staffing; administration of pensions, retirement, and health care benefits; and employee counseling. Although the majority of businesses do not entirely replace the HR department, outsourcing these simple but time-intensive tasks reduces workload and allows the remaining HR staff to focus on strategy and improving company productivity. Outsourcing to an experienced provider also helps control legal risk due to any failures in compliance with regulations as well as offering valuable insight from experienced HR professionals.
 

2.Payroll Outsourcing

Payroll outsourcing is also common practice among both large and small companies. Benefits to payroll outsourcing include saving time, expenses, and freeing employees to work on core business functions. All too often because payroll is a monotonous and complicated task, employees make mistakes that incur IRS penalties or fines. Outsourcing payroll functions not only shifts that risk to another firm but also saves considerable money by avoiding the need to invest in unnecessary computers, software, and corresponding costs of training and maintenance. For larger companies, costs in outsourcing payroll decrease due to economies of scale, and small businesses benefit from lower overhead costs. Payroll agencies are experienced and knowledgeable ensuring that client companies are fully compliant with tax laws, and employees are always paid timely and consistently. Finally, for companies with global payroll systems, outsourcing allows the company’s entire payroll to be accessed through one single cloud-based system that integrates different currencies, time zones, languages, etc.
 

3.Recruiting Process Outsourcing (RPO)

Recruiting employees through an in-house department can be very inefficient. There can be problems including only finding low-quality candidates, high overhead costs to support an in-house recruiting department, slow hiring processes, and high turnover rates due to hiring inappropriate people. Outsourcing employee recruitment will streamline the entire process and find better quality candidates in less time, which in turn, saves money. Outsourcing the recruiting process also allows companies to scale up or down for seasonal hiring fluctuations and times of rapid growth. Recruiting Services Providers specialize in finding the best candidates and offer clients strategic information through detailed reports and analysis of the recruiting process.
 

4.Procurement and Supply Chain Outsourcing

Procurement and managing supply chains can be a time-consuming and costly practice. By outsourcing the procurement process, companies gain access to expertise, industry knowledge, and a large network of connections. Companies benefit first of all through cost reductions thanks to fewer in-house employees and less office space to support. Then because the outsourcing company handles the particulars, the client company avoids training fees and yet benefits from the most specialized technology. Procurement providers also offer cost savings through economies of scale, leading to lower transaction costs per purchase of company supplies. Providers are able to negotiate for lower discounts and know which vendors offer the best products all of which make outsourcing more effective and profitable. In managing supply chains, outsourcing agencies have the experience and connections to suggest less expensive materials, optimize transportation of products, and manage the client company’s inventory. In addition to basic services, outsourcing allows for better information and purchasing analysis which in turn helps the company maintain focus on strategic decisions, marketing, building customer relations, and other core business functions.
 

5.Legal Services/Processes Outsourcing (LSO/LPO)

Legal Services Outsourcing offers businesses the opportunity to form strategic partnerships with third-party vendors specializing in niche legal areas. Services often include legal and litigation support, research, visa/immigration application drafting, intellectual property rights enforcement, and document processing. One major benefit from outsourcing legal services is the cost savings. Hiring and maintaining an in-house legal department is often much costlier than utilizing an outside vendor. Furthermore, outsourcing tasks to foreign services providers can be especially cost-efficient, considering that many foreign employees earn lower wages for the same labor. Outsourcing legal services provides more expertise in specific legal areas and leverages the economic comparative advantage to provide high-quality work with lower costs. Differences in time zones also provide advantages as projects can be managed across the globe almost 24 hours per day and 7 days per week. Legal Services Vendors also allow for greater flexibility, so that small companies with varying legal issues can better scale up or down. 

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