Introduction
Outsourcing non-critical business processes can give you a huge competitive advantage when it comes to getting more for less. Your goal as a business should be to focus on your core competencies so that you can provide quality products or services at an affordable price. So, it makes perfect sense to outsource non-vital activities to experts who can do them quickly and efficiently. This gives you more time to focus on your core business activities.
Statutory Compliances, fixed assets, inventory management, payroll, hiring, attendance, invoicing, accounts receivable, barcode numbering and so on – the outsourcer’s expertise does all the work for you. The more work done by a professional external party, the more efficient and profitable your business becomes. In this blog series, you’ll learn why it makes sense in today’s world to focus on your core competencies by outsourcing non-core tasks to compliance outsourcing financial services companies.
Let us take a close look at the factors that might determine which processes in the organization are not core business
Your functions may be non-core if: (In the context of a business process)
- The functions in the company are routine.
- The functions, rules, or process chart could be simplified and made routine.
- The functions could be automated with access to new technologies not available in-house, and technology investment is unlikely given other priorities.
- The functions cannot be eliminated or automated, however, the cost per transaction could be reduced if outsourced.
- The function does not require higher-level skills such as analysis & evaluation.
- The function is not aligned with the company’s vision.
- The function does not affect policy setting.
- Outsourcing allows us to better benchmark the functions and improves KPIs.
- Our ability to focus on activities that deliver values is improved by removing that function.
Your functions may be non-core if: (From the perspective of the people in the organization).
- Outsourcing a function allows the company’s employees to take care of more central and strategic tasks.
- If a function requires a certain level of expertise that requires more highly skilled employees, this can be costly in the context of that function.
- The level of Staffing resources is currently set for high-season or low season.
- There are underutilized manpower resources in the low periods.
- The organization needs access to talent to scale up or down when needed.
- By outsourcing, the organization can remove redundant positions
- If the company require to minimize labor costs?
Your functions may be non-core if: (From the technological point of view of the business).
- Outsourcing is the gateway to better technological progress than what your company can achieve internally.·
- Access to technology for an independent process improves communication and breaks down silos. Cybersecurity and infrastructure security, cloud computing security, data encryption, and data loss prevention are some examples of functions that require high technology capabilities.·
- You can reduce costs and efficiency by using modern technology.·
- Technology enables the organization to improve its control and compliance capabilities.
- Technology improves the accuracy of reports and information for decision making.
Going Ahead.
I hope that based on the above factors, you could easily determine that various functions in the company, although very important, are not part of the core competence of most companies. By delegating these functions to external outsourcing service providers, you can focus on what you do best and grow your business – your core competencies.
In the next and final blog in this series, you’ll also learn about the benefits of outsourcing non-core tasks, such as cost savings, quality improvement, risk reduction, and faster marketing of your products and services.