our perspective on Outsourcing ...

...Don't outsource your profits...

Outsourcing has become an urgent business issue. Firms cannot ignore the potential cost savings in today's business environment. Services are now available for core business processes: customer service, manufacturing, marketing, supply chain management and more. Accounting, HR and IT outsourcing have become much more sophisticated. Web-based communications make outsourcing easier and cheaper. Significant cost savings are available. 

However, it's hard to know what to outsource. Too much outsourcing risks losing control over key sources of profit. Too little outsourcing risks being stuck with high costs and low flexibility in an increasingly competitive marketplace. Objective advice is hard to come by - many large consulting firms are major players in the outsourcing business. 

Our view is that outsourcing must increase profitability in the short and long term. Before outsourcing, executives should ask two questions: 1) where do our profits come from? and 2) where will our future profits come from? Executives can then tackle key issues:

• What is critical for us to keep within the firm?

• Which services are reliable enough to use?

• What cost savings are available?

• Does the reward justify the effort?

• If we do choose to outsource, how should we manage it?

Percipient Consulting can provide an objective evaluation of the benefits and costs of outsourcing for your company. We have advised on multi-billion dollar business process outsourcing, functional (such as HR, accounting and procurement) and IT outsourcing. 

For more information, please contact us.

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