What is strategic outsourcing?
In the first two examples, the outsourcing decisions were driven by a tactical problem-solving mentality. In the first, outsourcing solved the payroll processing problems. In the second, outsourcing solved the skills problems. In the third, it was driven by both tactical and strategic issues in which outsourcing solved the process stagnation, productivity deterioration, and key employee defection problems, looking at long-term issues. Accordingly, the outsourcing initiative becomes strategic when it is aligned with the organization’s long term strategies, and when the typical outsourcing benefits will emerge over several year, and when the results, either positive or negative, will be significant to the organization.
What is strategic outsourcing? In the first two examples, the outsourcing decisions were driven by a tactical problem-solving mentality. In the first, outsourcing solved the payroll processing problems. In the second, outsourcing solved the skills problems. In the third, it was driven by both tactical and strategic issues in which outsourcing solved the process stagnation, productivity deterioration, and key employee defection problems, looking at long-term issues. Accordingly, the outsourcing initiative becomes strategic when it is aligned with the organization’s long term strategies, and when the typical outsourcing benefits will emerge over several year, and when the results, either positive or negative, will be significant to the organization.
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