| We are all know about the concept of outsourcing.Nowadays outsourcing in the world are increasing and going on and on.For example, many big companies in the world employed their own cleaning, catering, security and other support staff .And it is not just private companies that have embraced outsourcing. A lot of public sector bodies now outsource similar support services too. The health servicem,prison service, and many other government departments and local authorities are going through outsourcing.
estment idea, it’s better to look at the outsourcing of higher value added services. These are what might be called ‘intellectual’ services involving much higher levels of skill than things like cleaning, security, catering or the transport of prisoners. One common example is the outsourcing of IT support but even this still does not represent a very high skill level in most cases.
From an investor’s point of view, the intellectual services that matter are those where the skill level is sufficiently high that the customer is much more concerned about quality and reliability than price. An example might be the translation of a patent for filing in a new country. A poor quality translation could render the patent invalid or open to challenge in the new country. Quality not cost is clearly the priority in this case.
The customer for such value added intellectual services benefits from the quality and reliability offered by the outsourcer. It is also likely that the service will cost less than maintaining a small in-house department that may rarely be fully occupied. And there is always the worry that a key member of staff will fall sick or leave. The outsourcing company benefits too since it can spread overheads over a large and predictable workload and should be able to keep staff fully occupied. It should also be able to keep up with the latest ideas and best practices and have more scope for achieving efficiencies with technology.
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