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	<title>Vintera Systems &#187; Outsourcing</title>
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		<title>Why Outsourcing</title>
		<link>http://www.vinterasystems.com/outsourcing/why-outsourcing/</link>
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		<pubDate>Mon, 12 May 2008 10:27:28 +0000</pubDate>
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		<description><![CDATA[Outsourcing is the transfer of the management and/or day-to-day execution of an entire business function to an external service provider. The economist, Adam Smith, says in his treatise The Wealth of Nations, &#8220;If a foreign country can supply us with a commodity cheaper than we ourselves can make it, it is better to buy it [...]]]></description>
			<content:encoded><![CDATA[<p>Outsourcing is the transfer of the management and/or day-to-day execution of an entire business function to an external service provider.</p>
<p>The economist, Adam Smith, says in his treatise The Wealth of Nations, &#8220;If a foreign country can supply us with a commodity cheaper than we ourselves can make it, it is better to buy it of them.&#8221; Outsourcing as we know it today is merely a progression of an idea that has existed since early days of trade.</p>
<ul>
<li><strong>Cost savings</strong>. The lowering of the overall cost of the service to the business.  Access to lower cost economies through off-shoring  the wage gap between industrialized and developing nations</li>
<li><strong>Cost restructuring</strong>. <a href="http://en.wikipedia.org/wiki/Operating_leverage" title="Operating leverage">Operating leverage</a> is a measure that compares fixed costs to variable costs. Outsourcing changes the balance of this ratio by offering a move from variable to fixed cost and also by making variable costs more predictable.</li>
<li><strong>Improve quality</strong>. Achieve a step change in quality through contracting out the service with a new service level agreement.</li>
<li><strong>Knowledge</strong>. Access to intellectual property and wider experience and knowledge.<sup id="cite_ref-12" class="reference"> <a href="http://en.wikipedia.org/wiki/Outsourcing#cite_note-12"></a></sup></li>
<li><strong>Contract</strong>. Services will be provided to a legally binding contract with financial penalties and legal redress. This is not the case with internal services<sup id="cite_ref-13" class="reference"> <a href="http://en.wikipedia.org/wiki/Outsourcing#cite_note-13"></a></sup></li>
<li><strong>Operational expertise</strong>. Access to operational best practice that would be too difficult or time consuming to develop in-house.</li>
<li><strong>Staffing issues</strong>. Access to a larger talent pool and a sustainable source of skills.</li>
<li><strong>Capacity management</strong>. An improved method of capacity management of services and technology where the risk in providing the excess capacity is borne by the supplier.</li>
<li><strong>Catalyst for change</strong>. An organization can use an outsourcing agreement as a catalyst for major step change that can not be achieved alone. The outsourcer becomes a change agent<a href="http://en.wikipedia.org/w/index.php?title=Change_agent&amp;action=edit&amp;redlink=1" class="new" title="Change agent (page does not exist)"></a> in the process.</li>
<li><strong>Reduce time to market</strong>. The acceleration of the development or production of a product through the additional capability brought by the supplier.</li>
</ul>
<p>We provide few outsourcing options which includes:</p>
<ul>
<li>outsource whole IT department</li>
<li>outsource IT Security Team</li>
<li>outsource new application development</li>
<li>outsource maintenance of ongoing application</li>
</ul>
<p>New trends of outsourcing is called <em><strong>holistic outsourcing</strong></em>,   good reading can be found <a href="http://www.bmighty.com/hardware_software/showArticle.jhtml?articleID=207401346" target="_blank">here</a>.</p>
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