Improve Company Focus

Outsourcing can help an organization to reduce its view of and concern with functions other than the core business. At the same time, the view of that core business can become broader, allowing closer analysis of competitive and innovative issues. This is an important point to consider when looking at other reasons for outsourcing: World-class capability should be achieved by an organization within its core business. It should not need to develop this capability within other parts of its business.

People should focus on the organization's core business, and should be freed from involvement with other business issues as much as possible. This should enable them to provide an in-depth focus across a broader range of issues affecting the core business. Capital should be invested in supporting and enhancing the organization's capability to continue its core business. Outsourcing allows a company to focus on its core business by having operational non core functions assumed by an outside expert.

Freed from devoting energy to these non core areas, the company can focus its resources on meeting its customers' needs. Just as an organization attempts to concentrate on its core business, so outsourcers concentrate on theirs. As a result, outsourcers must continue to demonstrate continuous innovation, sound methods, specialist skills and competitive price performance. There is also a warning in this for customers of outsourcers. They must be satisfied that their outsourcers will continue to remain committed to outsourcing as their core business implement new, effective methods, tools and technologies stay up to date with developments in their industry provide competitive pricing.

Business reengineering can enable an organization to identify the processes that will provide dramatic gains in performance. In adopting those processes, an organization may also decide that some of the performance gains can best be achieved through outsourcing. There is, of course, a question of scale to be considered when linking outsourcing to business reengineering. The following questions should be asked. How many outsourcing opportunities are there? Can we do them all together or should they be incremental? Should outsourcing follow completion of the reengineering? How long will the reengineering take? Can we afford to delay outsourcing until the reengineering is complete? Can the organization handle more change? Will the outsourcing exercise put further pressure on people committed to the reengineering project? Will more change cause greater resistance?