Nowadays it is not uncommon for people to hear the term freelancing. This is true especially when it comes to companies. However, as common as the term may seem, only a few individuals know what outsourcing really indicates and the clockwork behind it.
What is Outsourcing
Basically, outsourcing is getting into an agreement with other businesses or a person to do a particular job or function. nowadays, most organizations, especially large ones, are outsourcing in some way or another. Most jobs that are being outsourced are those that are not considered as part of the core of their company. For example, a bank might outsource its landscaping plus janitorial operations to people or even companies that specialize in all those areas given that they are not related to banking. The companies or people who provide these outsourcing work are what is known as thirdparty providers, more commonly called because service providers.
Outsourcing has been existing ever since specializations in different areas of works arose. prior to, companies made use of the freelancing model to do narrow features an example of which is the salaries or billing. It has been noticed that outsourcing these procedures to a company that specializes in a specific area, having the right services, tools and personnel, gets the job done efficiently at the least amount of cost.
Different Forms of Outsourcing
There are several forms of freelancing. Companies and other organizations utilize the help of service providers to take care of various business process one of which is benefits management. There are some businesses however who outsource entire operations. The most common forms of freelancing that handles this are usually IT Outsourcing (ITO) plus Business Process Outsourcing (BPO).
BPO covers outsourcing such as human resources outsourcing (HRO), call center outsourcing, claims processing freelancing and finance and data processing outsourcing. These kinds of outsourcing generally involve contracts that period to a number of years and backed up with millions of dollars in funding. People performing the jobs in house for the client company will then be transferred to the service provider and eventually become their employees.
exactly how Outsourcing Works
There are four stages that cover the process of freelancing. First stage is tactical thinking. In this stage, the particular philosophy of the organization when it comes to outsourcing activities is created. Second stage is assessment and selection. In this phase, the company decides on what tasks are to be outsourced or not. feasible locations and the service providers to do the job are also discussed.
The third stage is the contract advancement. Everything is put into black and white so as to legalize the whole procedure. This includes service level contract and pricing terms. 4th stage is outsourcing governance or management. This phase is for ensuring the processing of the relationship between the customer company and the outsourcing service providers.
The success of an outsourcing task depends on three factors: great and constant communication in order to concerned employees, executive-level support in the client company for the freelancing mission, the ability of the customer to manage the hired service providers. An outsourcing professional responsible for the client company and the service providers should be equipped with skills in different areas.
Such as project administration, communication, negotiation, flexible in order to changes when the situation calls for it, ability to understand the contract’s terms and conditions and also the SLA or even service level agreements.