How Outsourcing Will Affect The Economy?

In recent years, outsourcing has become one of the most discussed subjects in business circles. With the rise of digitalization in business, physical presence in the workplace is becoming less necessary. In addition, as the old school office spaces are losing their cultural relevance, companies realize they don’t need to compete with other businesses to hire local talents.

An estimated 300.000 positions are outsourced every year from the U.S alone, and 59% of businesses use outsourcing to reduce their expenses. With numbers as high as that, it is no wonder that outsourcing has a significant impact on the global economy. 

Why Do Companies Outsource Talent?

The answer to this question may vary from company to company, but one of the top reasons for the popularity of outsourcing is its cost-efficiency. 

Having an in-house team can be much more costly than hiring offshore talent. Hourly rates being more affordable offshore is a part of the equation; however, that’s not the only issue. An in-house team will need extra office space and equipment that you will be responsible for purchasing and maintaining. Not to mention that the hiring process for these employees can be long and arduous. 

Another main reason for outsourcing is the global lack of talent in certain professions, such as software development, while the need is constantly increasing due to digital transformation. For example, as many as 39% of employers have reported a shortage of talent in the fields of system developers and system administrators. 

So, companies handle this challenge by outsourcing software development as a reliable solution for getting the job done in a stress-free and time-saving way.   

The Impact of Outsourcing on The Economy

Technology, including digital services, software, and software-based services, is leading the economy globally. Accordingly, the trend of outsourcing tech talents is changing the game, requiring companies to adapt to the new economic environment. 

In earlier decades, technology became a part of the business world with the need for a website and digital presence. However, digital transformation rules how we do business now, and the demand for experts in tech is drastically increasing. 

Companies are outsourcing talents to achieve their digital transformation goals. To state more clearly, by partnering with these providers, companies maintain cyber security, build apps, and go digital and agile without a considerable investment. There is no doubt that these services are mandatory in today’s business world and require quite a lot of attention to get the maximum benefit from them.

With a handy outsourcing strategy, the companies save their budget on tech and create big waves in the global economy. Even though unemployment seems to be the most significant unintended result of outsourcing in the economy, we can also interpret this situation as a shift in employment models. 

The professionals with experience and talent don’t want to limit their potential within a company. Instead, they want to expand globally and join the global economy. As a result, the cost of acquiring a good service may increase. However, it’s still more budget-friendly than hiring teams in-house. Because companies pay an hourly or a project-based price, they spend money on tech services only as long as they need them. 

Main players in the outsourcing

Outsourcing benefits two main groups. The first group is smaller countries and countries with developing economies. While they have a large pool of talented workers, their local economy might not have the infrastructure or the resources to acquire their services. 

As a result, qualified workers in these countries can sell their outsourced services for more money than their local economies would allow. This results in the growing impact of these countries on the global economy. The physical boundaries in employment are disappearing, and professionals in developing countries are increasing their chances of getting satisfaction in their careers. 

The second group is enterprise-level companies with talented teams offering world-class service. These providers act as a limb for their clients to contribute to their tech needs. Therefore, companies that get their support can access all devices, tools, and talents these providers offer.  

Conclusion 

The economy has a mind of its own, and few can predict the exact impact of outsourcing on it in the long run. So the best you can do is analyze the current data and have an educated guess on what might happen. 

Like any other business practice, outsourcing is a complicated subject with its own set of pros and cons. We will have a better grasp of its effects in the near future. But until then, it remains a reliable source of help for companies who can use an extra hand.

Manage Sustainability with Business Intelligence

Sustainability is critical in today’s rapidly-changing and highly-competitive business conditions and digital transformation is helping the companies to achieve it. Nevertheless, the process is thorough, requiring highly advanced technological approaches in most cases.

No doubt increased sales and profits along with reduced costs are highly mandated to maintain a company. However, in current bussiness world, business owners and managers only with knacks to make strategic sustainability decisions can move forward cautiously and consistently.  

Making informed decisions helps you stay competitive. For this, you need a broader understanding of your past activities and a regular analysis of your current situation.

At this point, Business Intelligence (BI) plays an important role for the future of your company by helping you make data-based decisions. Business Intelligence collects, stores and analyzes data based on your company’s activities to minimize strategy risks and boost sustainability. In this way, it helps you reduce operational costs, increase revenue, improve customer service, and more.

How to be more sustainable?

When you bring together your teams on a common mindset based on real activity of your business, they can increase efficiency of each task on the way to your ultimate goal. That’s how you can achieve sustainability. 

Through a variety of tools and platforms, process tracking and analysis helps establish the necessary common ground for consistency of workflows. Regular and systematic evaluation of business processes empowers the hands of companies to make faster and more accurate decisions.

Therefore, companies need to find practical applications to deal with ever-growing databases and analyze complex data for targeted strategies. In order to manage the processes that arise in the face of these needs, technology support becomes inevitable.

On the other hand, there are numerous technologies you can use for sustainable businesses. For example, task-oriented RPA can help you speed up repetitive tasks, while business analytics can initiate radical changes in the entire workflow. Both are valuable and are part of Business Intelligence, which is extremely effective in keeping your company sustainable.

How Does Business Intelligence Improve Sustainability?

​​Business Intelligence use cases for better development, testing, and implementation improve sustainability. It provides the ability to organize confidential and critical data, facilitate consistency, and analyze the entire management process.

Here are the main points how business intelligence improves sustainability.

Unite employees on a centralized system

Data-driven business decisions require access to information. When your employees at all levels can access the accurate, up-to-date, and complete information they are looking for easily, whenever they want and in any format, the processes will be more sustainable. 

Business Intelligence enables your teams to communicate and store the data on a centralized system. They can share the files and reports when needed quickly. Therefore, you achieve organizational efficiency and improve employee satisfaction drastically.

Improve decisions with instant analysis and reporting 

Business Intelligence allows you to collect data based on your activities so that you can get the knowledge specific to you. In addition, you can automate the data collection and interpretation to make better and faster decisions than ever before. 

The system analyzes and updates the reports regularly, allowing you to get detailed information about your activities using various tools. Therefore, you can set your strategies sustainably without taking risks and losing time.

Instant reporting and analysis also bring flexibility to survive in changing conditions. BI systems provides online analysis, warning, design of queries, accessing data, identifying exceptions, and presenting reports and decisions at all levels. 

Boost agility with notification and alert center

Quick reaction matters as much as wise action. Business Intelligence supports your agility which is an important aspect of sustainability by informing you automatically when needed. 

You can create target values in your report and allow the system to warn you when the numbers you want or do not want occur, and you can provide laborsaving control. Thus, under your management, you are automatically warned by the notification center when data you want or do not want occurs.

It also makes the steps more clear by enhancing the visuality of the processes. The BI systems prepare all your data in various formats such as summaries, tables, graphs, charts, and maps. Interactive dashboard and user-friendly interface simplifies even the complex situations to interpret data more insightfully.

Sustainability and Business Intelligence are interconnected. Business Intelligence enables more data-driven and informed decisions about how to position against competitors for better sustainability. After disseminating Business Intelligence within the organization, each employee in the enterprise can make more accurate and consistent decisions relying on the data. 

Contact us to learn more about how to achieve sustainability with Business Intelligence.