What makes labor outsourcing so in demand?

Outsourcing is a norm today. The comfort level of companies with this trend that was previously considered ‘risky’ and ‘unreliable’ has stimulated so much that we see it happening with Manpower as well. The current trend in the industry is to outsource everything that is not “core” to the operations of any business.

In general, outsourcing of labor is done in situations where a certain company does not want to hire internally. In most IT companies, labor outsourcing is a frequent feature. Needless to say, this practice helps save costs to a considerable extent. But what are the other reasons that make labor outsourcing so famous?

Helps strengthen the core: Outsourcing labor for short-term tasks allows management to focus more on the core activities of the organization. Core refers to tasks of strategic importance. In this way, you are participating in the overall growth of the organization.

Efficiency savings: There is no doubt that labor outsourcing is the right way to cut costs. However, another type of saving that it promotes is ‘efficiency saving’. More focus on core tasks means efficiency in performing them. There is less wastage of internal resources in various jobs and thus the efficiency is used in the right direction judiciously.

Greater operational control: Doesn’t it make much more sense to outsource back-end work that doesn’t require key skills, rather than outsource all operations? Maintaining operational efficiency and preventing the secrets of operational excellence from leaking requires strengthening internal operational control.

Improved employee development: When internal hiring for all other short-term projects is not the main agenda, the focus and energy can be shifted to developing existing internal staff. Training internal staff means improving their efficiency in performing core operations and preparing them for internal promotions.

While those listed above are the main benefits that outsourcing labor allows, there are other advantages as well. These include:

1. No responsibility for the permanent hiring of people

2. More flexibility in hiring

3. Hiring/outsourcing of short-term experts

4. Improvement in the quality of work performed by outsourced labor

5. Reduced cost of training for the human resources department, since it can subcontract previously trained labor

6. Reduced cost in the company to pay the licenses of subcontracted employees

7. Easy availability of labor willing to work night shifts

In general, what outsourcing means for an organization is that when the work is not of strategic importance, external sources who are not fixed responsibilities of the organization can be contracted to do the work. Such working relationships are beneficial to both parties. Organizations that opt ​​for labor outsourcing do a thorough analysis of how much they can benefit from labor outsourcing in each scenario. Only when it is profitable enough, do they proceed with this option. There is no shortage of labor waiting to be outsourced. This makes outsourcing an even more enviable trend.