luke ouko on main advantages of outsourcing Outsourcing is the process of handing out departmental or specialized non-core functions of a business to external firms or subsidiaries that are best able to manage those processes. According to Karani Nyamu, the CEO of Verve ko, a leading outsourcing and consulting firm, there are both financial and non-monetary benefits accrued from outsourcing.
- Focus on Core Functions: luke ouko on main advantages of outsourcing With the growth of a business also comes the growth in non-core activities that are needed to keep the operations successful. It is possible in the process of expansion, for you to take on so many non-core yet critical functions, that they begin to obscure your primary goals. Outsourcing most of these activities frees up the company to focus on the few items that are central to its existence and operations.
- Cost Cutting Measures: luke ouko on main advantages of outsourcing All companies have their competitive advantages that are critical to its success. When, as a firm you are willing to outsource your non-essential production and process management you are then able to focus on that which you can perform cost-effectively. ‘You are bound to experience cost reduction in a very short while.’ says Luke Ouko a partner at Verveko.
III. Minimizing Overhead Costs: luke ouko on main advantages of outsourcing With business growth comes an increased pressure on the existing amenities and the need for bigger facilities, which results in increased overheads. Most often it is easier to outsource these non-core functions to specialized firms that can avail them at a far lesser operating costs. Specialized firms have the experience and staffing as well as the facilities needed to sustain these outsourced functions, at a fraction of what a firm will have to spend, if they are to absorb and manage these operations from within.
Workforce Flexibility:luke ouko on main advantages of outsourcing
The functions that have a cyclical demands are best outsourced during the peak season and released during the low seasons. For example it is easier to hire temporary marketing and sales staff during festive seasons as opposed to retaining the same number all year round. Outsourcing such functions keeps the costs incurred low and commensurate with the sales volumes at these points in a business cycle.
luke ouko on main advantages of outsourcing
- Managerial Control: luke ouko on main advantages of outsourcing Departments and functions sometimes evolve into unmanageable systems in the business. At this point when they consume significant time and resources they become prime for outsourcing. Also keep in mind that when the staffing needs and knowledge as well as the costs involved in a process exceed the business capacity to effectively control it, then it is best outsourced.
Managerial control means all functions have to be in line with the business’ leadership vision hence functions that cannot be efficiently integrated into the other functions have to be handed to specialized outsourcing firms and that’s luke ouko on main advantages of outsourcing.