Offshore Outsourcing Benefits and their Types

Offshore Outsourcing Benefits and their Types

Picture of Daven Michaels

Daven Michaels

New York Times Bestselling Author, 30-year business veteran, and Executive Chairman of CurrentC Group.

The important partThe words Offshore means relocation of business process from one country to another while Outsourcing means movement of internal business process to an external company. Offshore outsourcing means moving business processes to an external company from one country to another company, there by reducing their own domestic employment and domestic investment. The country such as United States and United Kingdom over last few years has a potential affect on increase in IT jobs like data entry, computer programming, functioning, and customer care, where offshore outsourcing has come a long way in a short time by saving time and money.

There are four basic types of offshore outsourcing

  1. ITO: Information technology outsourcing.
  2. BPO: Business process outsourcing covers things like running call centers, processing insurance claims.
  3. Software R&D: Offshore software development.
  4. KPO: knowledge process outsourcing covers things that require a higher skill set such as reading X-Rays, performing investment research on stocks and bonds, handling the accounting functions for a business or executing engineering design projects.

Offshore outsourcing has increased a growth strategy and essential revenue for almost every existing corporation. This has become a short term solution and received almost equal benefits by providing services in more efficient and effective time limits. It also has maximum flexibility with your workforce and access to high quality employees.

Strategic Advantages:

  1. Flexibility: It applies to several views of relationship with the service provider. Based on work and capability of service provider, we should start with small projects and move to big projects, which create flexibility in the company ensuring the best utilization of the available resources.
  2. Cost: The cost of offshore outsourcing is much lower over the market and free up management resources. Offshore outsourcing is the best possible quality at significant cost savings to you in software development side, which builds relationships to add value for your clients.
  3. Focus: Time plays valuable resource within the management. Most of the time, the executives spend 80 percent of time managing the details, 20 percent on planning and customer relations. The ratio of this percentage can be reversed by this offshore outsourcing.
  4. Rapid Migration to New Technology: Offshore outsourcing uses the latest technologies to serve their international clients. Access to new technologies that might not be used in the company will be gained by the new technologies in short term.
  5. Re-deploy Resources Strategically: This lets the internal resources focus on the personal strategic issues related to the business.
  6. Exploit the Time Zone Advantage and reap the benefits of 24-hour development cycle: The companies outsource their process to India benefiting 24/7 services to exploit the time zone advantage by providing the customers as and when needed. Offshoring offers better utilization of the multiple time zones.
  7. The success of offshoring outsourcing depends on the above focused benefits that come with it from several perspectives, rather than just a cost effective venture. Offshoring gets the company closer to its global customers thereby providing appropriate services to its regional market and provides customer satisfaction which brings increase in revenue streams for the companies.

Daven Michaels is an award-winning outsourcer and author of the book, ‘Outsource This!’ Daven has been honored more than any other individual or outsourcing organization. You can get more information on outsourcing by visiting

3 thoughts on “Offshore Outsourcing Benefits and their Types”

  1. Offshore outsourcing is the best possible quality at important cost benefits to you in application growth part, which creates connections to add value for your customers.


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