Outsourcing: What is it really and what are the 10 key trends to monitor in 2022 ?
During the last years, companies in all sectors have turned to outsourcing. Since the economic crisis of 2008, outsourcing is on the rise and is proving essential in many fields, ranging from accounting, to IT, and to customer service as well. Moreover Since Covid, and thanks to new technologies, the use of such a process has become simpler to the point that even small businesses think about it.The IT sector is also one of the industries most interested in this approach, from cybersecurity, to Cloud computing, the fields are quite divergent.Today we would like to get to the bottom of two fundamental questions:
What is outsourcing ? What are the latest trends in outsourcing ?
What Is Outsourcing?
The definition of outsourcing
Outsourcing, known as “externalisation” in French, is a widely used Anglicism in the world of entrepreneurship. This term is made up of three English words which are outside, resourcing and using, which means simply using external resources with the required expertise in a specific sector. This means that some services will from now on be obtained from a service provider who specializes in them. In other words, by outsourcing, we mean the delegation of a company’s tasks to a third party. These tasks can be very different in nature. They can refer to the process or the field of specific tasks. Additionally, entire departments can also be outsourced.
What are the benefits and risks of outsourcing?
Outsourcing has various benefits but also several disadvantages. We have tried to sum up the most important points.
Avantages of Outsourcing :
- The company can concentrate on its core business.
- Cost savings compared to providing the service in-house.
- Fiscal advantages of external supply: Outsourcing costs reduce taxable profit.
- Qualitative advantages: Experienced contractors can do a better job than their own team.
- Strategic partnerships can open up new business areas.
Risks of outsourcing:
- The risk of a loss of know-how due to the outsourcing of functions.
- Possible problems in the working atmosphere. If the employees regard service providers as a kind of competitor or their own jobs as threatened by outsourcing.
- Data protection- because depending on the outsourced function, the service provider gains insight into the company’s sensitive data.
When should you outsource a project?
Outsourcing is recommended when a company needs tobecome more flexible and focuses on its core business.Outsourcing part of the job can give your team the necessary bandwidth to focus on the main tasks. This might actually be the move that can stop the slide. However, for such an approach to be cost-effective and secure, it is important that its own key skills and technologies are not outsourced.
How do you ensure successful outsourcing?
To answer this question, companies should ask themselves the following questions:
What are the main skills and strengths of the company? In principle, these that must remain in the company.
Which processes are not part of the core business? These that can lend themselves to outsourcing.
➔Every outsourcing decision had a profound impact on the structures of a company, even if it is initially only a matter of outsourcing non-critical areas.
Therefore, each area to be rearranged must be implemented in several stages:
What are the processes of outsourcing?
Before choosing to outsource certain tasks, the company should follow a well-researched process to determine the goals and the means of controlling its decision and this is to be carried out through:
The first step : Identification and in-depth analysis of possible areas or tasks to be outsourced.
The second step : determining who is responsible internally and selecting a partner.
The third step : drafting of the outsourcing contract: specifying in detail precisely what needs to be done and to what extent.
The fourth step : Implementing an internal organization adapted to the needs of the outsourcing company.
Which company can outsource its administrative service?
Small and medium-sized businesses struggle with many administrative tasks, including human resources (HR) operations. As the company grows, managing social benefits, payroll and training takes time and requires a lot of resources. A partnership with a service provider can help you meet urgent operational needs without having to sacrifice the time you devote to the success of your company.
What are the recent trends in outsourcing?
The latest 10 trends in outsourcing 2022
As a business leader, researching current trends in outsourcing will help you adapt to the new normal of the post-pandemic world. This suggests that companies will have to find suppliers providing quality service, aim for high flexibility and take advantage of updated technology during outsourcing in 2022.
1️⃣Cybersecurity: Safety will be a priority
Data security will continue to be at the top of the priority list in terms of outsourcing. Indeed, security risks are constantly increasing.Therefore, threat-related information, security advanced automation and safety analysis become necessary.
2️⃣The cloud computing
The cloud computing proved to be a game changer for many industries helping to access services such as storage and processing power. As such businesses can expand and further develop their operations without the costly investment of on-premises IT infrastructure
Telework is a trend that has changed the way outsourcing companies operate over the years and this trend is here to stay.
4️⃣Social media Services
When it comes to outsourcing, one of the growing trends is the demand for social media services. In 2020, more than 3,6 billion people in the world used social networks.
A unified communication tool and the omnichannel solution are one of the main outsourcing trends in 2022. As outsourcing companies get to grips with technology, they will be able to develop the tools and resources required to facilitate the omnichannel experience.
6️⃣Business intelligent automation
Some outsourcing companies started adopting AI in the last year, which makes work processes more efficient and makes their partners more responsive, flexible and profitable.
Hiring niche talent has become the most common outsourcing trend to the point that that outsourcing companies make sure to offer their customers the best possible service in various fields of activity.
The need for specialized outsourcing is one of the outsourcing trends that has been at the top for a few years because the number of tasks that companies outsource is on the rise.
9️⃣Better technical support
With virtual assistance, outsourcing companies are able to offer a more reliable and responsive customer support.
🔟Increase in outsourcing among startups and small businesses
Thanks to outsourcing, small businesses or start-ups can access the best talents and tools at economical prices.
To conclude, outsourcing trends are constantly evolving and this change is also expected to continue in the years to come. With new technological developments advancing steadily, the outsourcing industry will only get bigger and become more efficient in the years to come. Companies will mainly focus on the provision of high quality service and on an exceptional customer experience, rather than on the simple reduction of the cost of services that they offer.