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Business Imperatives of ( Not ? ) Offsourcing.

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Business Imperatives..

Down Arrow Article Key Points

Gray Arrow Business Imperatives Drive Offsourcing.

Gray Arrow Offsourcing must help Increase Organization's Profits.

Gray Arrow Offsourcing can help increase both Sales Revenues or Decrease Expenses.

Gray Arrow People Costs look the easiest Expenses to start offsourcing.

Gray Arrow Very Rarely, do organizations consider using Offsourcing for Increasing Top Line - Sales Revenues .

Gray Arrow Identify Routine Work of Top Perfomers which can be offsourced.

Gray Arrow Besides an ROI for the Offsourcing Project, also prepare an RTI.

Gray Arrow An RTI - Returns-To-Individual Statement helps the Person, Team or Department understand their Benefits from Offsourcing.

Gray Arrow Plan, Plan, Plan...

Gray Arrow Email Us : Can we assist in your Offsourcing Business Imperatives ?

In my last article, I had mentioned about the Key Questions that Organizations should ask themselves. The first of these questions was about whether an organization should or should not start offsourcing.

Down Arrow Business Imperatives are the drivers to Offsourcing.

Gray Arrow What are the Business Imperatives ? Let us start with an Organization's Income Statement or an Organization's Profit & Loss Account.

An Organization's Profit is the difference between it's Sales Revenues and Expenses. Business Imperatives for Offsourcing have to be aimed at increasing the Organization's Profit.

That means, Offsourcing has to either Increase Revenues Directly or Indirectly.

And/Or decrease Expenses directly or Indirectly. Both these Impacts, of either Increased Revenues or Decreased Expenses will increase profits.

The most simplistic approach taken by organizations is on the expense side.

The maths is simple.

People look at their expense items.

People Expenses (Direct and Indirect) are amongst some of the biggest items here.

At first glance, it appears fairly straightforward that getting work done with people in low-cost countries will reduce people related Expenses on the Income Statement.

Usually, when properly managed, it does.

Very rarely, do people look at leveraging Offsourcing for increasing Sales Revenues. How ?

Identify the Key people in your company whose work productivity can be increased to help the organization increase Sales Revenues.

Prepare not only a Return-On-Investment (ROI) for the proposed Offsourcing Initiative.

Also prepare a RTI (Return-To-Individual) Statement.

Gray Arrow 'Better Planning ensures that Plans Work Better.'

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Last Updated on 28th March 2009
Posted on 15th May 2004

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