Many organizations today are making the decision to outsource. In today’s global marketplace outsourcing has made itself accessible to many organizations on a national and international level.
has provided many businesses with the opportunity to harvest the benefits of lower labor costs in developing countries with few workers rights laws and to exploit the value of artificially manipulated foreign currencies, where the exchange rate is intentionally undervalued. Through outsourcing, companies today have the ability to develop competitive strategies that will leverage their financial positions in the ever competitive global marketplace.
Outsourcing is also successful in increasing product quality and/or substantially lowering firm and consumer costs (e.g., increases the quality to cost ratio). Because outsourcing allows for lower costs, even if quality reduces slightly, which is sometimes the case, productivity increases, which benefits the economy in the aggregate.
Some of the major advantages that today’s organizations can expect to obtain through outsourcing include the ability to purchase intellectual capital, to focus on core competencies, to better anticipate future costs, to lower costs. Overall outsourcing is viewed by many organizations as a strong business tactic that ultimately is a superior economical approach to developing products and services.