What is Outsourcing? Factors that help Outsourcing success

Outsource is an effective alternative solution applied by businesses to increase work efficiency and save operating costs. However, there are many customers who still do not understand what form of Outsource is? How does IT Outsource company operate? And will outsourcing affect the operation of the company or not?

In fact, not all companies can afford to build departments efficiently and with quality. In addition, there are some departments that only operate on certain occasions a year, and the rest of the time is only responsible for maintaining the system. Invisibly, this creates pressure on the company when it costs money to hire employees but does not use it. Right now, the IT Outsource solution will promote its effective capacity, help businesses reorganize the company, solve problems at that time in the most professional way. Here, let’s find out what is Outsource concept with MP Telecom? Differences between Insourcing and Outsourcing in the following article.

What is Outsourcing?

Outsource is known as an outsourced service that cooperates with businesses to perform tasks, deploy projects, and fix business errors according to the agreement of the two parties. Outsourcing is often chosen by small and medium enterprises, companies that do not have enough economic resources. Because the staff of the service provider has extremely high expertise. At the same time, it can solve all difficulties of enterprises and give directions to promote business development without spending a lot of money on research and development, “raising” employees…

What is Outsourcing? Factors that help Outsourcing success

What is outsourcing? What types of outsourcing are there?

>>> See more: What is Outsource IT?

What is the difference between Insourcing and Outsourcing?

After knowing what Outsource is, next let’s distinguish the difference between Outsourcing and Insourcing. Detail:

  • Insourcing: is an activity where an enterprise will authorize the operation to a specialized department of another enterprise. The authorized party will operate separately from other parts of the company and undertake certain professional work.
  • Outsourcing: is an activity where a business directly hires a third party to complete the business model shortcomings. The staff and process control will not be in the hands of the company but will be completely dependent on a third party. The two sides have the task of reaching an agreement and making common observations to conduct cooperation.

The formation and development of the Outsource trend

Outsourced service was first introduced to the market in 1989. This form provides support services to help businesses carry out overloaded companies or activities where internal human resources are available. incapable of undertaking. Realizing its effectiveness and feasibility, this model has begun to thrive and is gradually being applied by companies/enterprises in business activities.

In order to meet the increasing needs of customers, the Outsourcing service provider also constantly strives to improve quality. Over the years, outsourcing services have grown and grown and are constantly innovating to suit today’s digital era.

The formation and development of the Outsource trend

Popular types of outsourcing

However, during the market launch, the outsourced service also faced criticism from experts. Some people think that Outsource is not capable enough to promote the development of the business. In addition, outsourcing will affect the company internally, causing imbalance and lack of unity among departments. At the same time, if this method is applied, the unemployment rate in the market will increase.

However, overcoming many obstacles, outsourcing parties have proven the value and benefits that this service brings. From there, let businesses around the world know what Outsource is? What is the function and task of Outsourcing and why should you use Outsourcing?

>> See also: CIO’s tips when deploying multi-source Outsourcing

What are the advantages and disadvantages of Outsourcing?

How to better understand the advantages and disadvantages of this form? Please follow the following article with MP Telecom for more details.

Advantages of Outsourcing

  • High specialization: Outsourcing companies will only focus on a particular task, so professional competence is extremely appreciated. At this time, the company only needs to assign the tasks that it does not specialize in to the outsourcer to manage, then focus on the remaining activities, which will increase the specialization.
  • Reduce operating costs: Outsourcers will have available human resources and resources ready to serve customers. As a result, businesses do not need to spend money on research, investment and improving the professional capacity of employees.
  • Access to modern technology resources: If you do not hire a third party, investing in high technology will cost a lot, so there are very few companies that can do this. But 3rd parties can provide businesses with this aspect at a very low cost.
  • Improve work efficiency: Outsourcing allows companies to focus on their area of expertise. Outsourcing will make up for the shortcomings that the company cannot do. The two sides work in parallel to help improve work productivity many times.
  • Saving workspace: 3rd parties operate independently and only support businesses when customers need them. So you do not have to open more offices for employees, do not need to buy more tables and chairs and work support tools.
  • Efficient operation: The Outsourcing company and the business side will sign a contract to commit to the project completion time as well as the achieved results. If the outsourcer fails to comply with the given requirements, the outsourcer will have to compensate the contract.
  • Improve employee psychology: Hiring support services is only conducted when the In-house team does not meet the professional qualifications. At this time, individuals in the organization will automatically be aware of their working capacity, thereby constantly striving to avoid the “risk” of being fired.

Disadvantages of Outsourcing

Customers don’t just want to know what Outsource is? What are the advantages of this service, but the disadvantages of the service are also things that businesses care about. Details will be updated shortly:

  • Poor security: When you choose to cooperate with another party, it means that the company’s security problems have been leaked to the outside. These parties can collect information and sell it to competitors at any time.
  • Impact on work progress: In fact, if the two parties have no commitment and commitment on time and work quality, the outsourced companies will successfully complete the project behind schedule. This has seriously affected the overall operations of the company.
  • Uncontrolled quality: The third party will not fully understand the business, the company, how it works and operates, thereby offering an ineffective solution.
  • Uncontrolled rental costs: Initial costs are set quite low, but in the process of operation, there will be many additional fees that the company cannot control. Therefore, it is necessary to add terms and commitments to this price in the contract to avoid over budgeting.

Factors that help Outsourcing success

Right from the very beginning, when not many people know what Outsource service is? to choosing this service to cut costs and improve operational quality. So far, outsourcing has grown strongly and created success by the following factors:

Set clear strategic goals

Enterprises need to determine their business goals, desired results and operational strategies, then consider choosing an outsourced service. From these factors, the company can allocate human resources to the necessary tasks. This division will also include the selection of items to outsource.

Build and expand relationships with stakeholders

Building and expanding relationships helps companies better understand the form of Outsource? What’s so special about this service and what tasks it can help the company with. As a result, companies will increase the need to cooperate with outsourcers.

Outsourcing unit support

Outsource units have high expertise and are hired to take on tasks that the company cannot do well. However, businesses also need to cooperate with these parties and share goals, orientations and strategies so that the outsourced unit can get the job done well.

Build a tight contract

In order for the plan to use outsourcing to achieve the best success, the two parties need to have a clear contract, set out specific goals and implementation time. This helps the Outsourcing party be responsible and complete the work quickly and efficiently.

The difference between Product and Outsource companies in Vietnam

Many customers still do not know what an Outsource company is? And the difference between Product and Outsource companies in Vietnam. In general, these 2 types have 3 specific differences as follows:

Nature of work

  • Company Product: Do the task of building content, developing and promoting the company’s own products, then make a profit. It is for this reason that Product companies have to plan from the beginning European production until the product reaches the user.
  • Outsource Company: Is a company that works independently from businesses, has high professional capacity and specializes in cooperating with companies according to the requirements of the partner side. Therefore, these companies will work according to the given project and receive money according to the agreed value of each project.

The difference between Product and Outsource companies in Vietnam

What is Product Company? Should you be a Product or outsource company?


  • Company Product: The target customer is the end consumer.
  • Outsource company: Customers are small and medium-sized companies, businesses that are in need of expanding markets, cutting costs and improving business performance.

How it works

  • Product Company: Operating in the form of 1 employee who can take on many different functions and tasks. Besides, this employee can be creative as long as the end result is customer satisfaction.
  • Outsource company: The outsourced staff group will only focus on professional tasks and implement the requirements that the partner gives. These employees are only under pressure to complete the project, but not responsible for the outcome for which the decision is made.

Should be a Product or Outsource company?

Answer the question What is Outsource, so should customers choose to work as an Outsource or Product company? In fact, choosing a Product or Outsource company will depend on the goals and direction of each company’s activities, so there will be no exact answer to this question.

  • If you decide to be an Outsource company, you can challenge in many fields, interact with many industries and customers. At the same time, it will increase understanding of many other issues in society. If you love innovation then outsourcing is the best choice.
  • In contrast, the Product company is highly cohesive and stable. It is this factor that can motivate the staff to put their heart into the company to look forward to long-term companionship. If you want to directly develop products and bring them to consumers, you should choose the Product form.

Benefits of choosing Outsource service at MP Telecom

Outsourcing has transformed from not many people know what Outsource is to becoming the number 1 choice for small and medium businesses. All thanks to the benefits that this service brings as follows:

  • Using highly specialized human resources while saving labor costs.
  • The extremely professional Outsource team can help get the job done quickly and efficiently.
  • Outsourced services serve in all areas, so if businesses encounter difficulties, they can be supported to solve them immediately.
  • Outsources companies will make a commitment to time and quality work. This factor can ensure the quality of completing the goals set by the business.

>>> See more: BPO service – Outsourcing business processes

Hopefully the information that MP Telecom brings can help you better understand what is Outsource? As well as know more useful information about the type of outsourcing.

It can be said that in the era of rapid economic development, the competitive factor of companies is pushed to the highest. At this time, the form of Outsourcing is gradually becoming popular and can help businesses deal with difficulties, improve operational quality, and stay ahead of competitors in the same industry. Besides, when outsourcing, companies also save a lot of technology investment costs as well as hire highly qualified staff. Most especially, when using outsourced services, problems will be solved quickly. At the same time, it can also improve the performance of the company. Once the business is stable, you can actively stop cooperating with outsourcers without any additional costs.

So we already know what Outsource is? As well as the benefits that Outsource brings? Businesses can rely on this to give direction and decide whether to cooperate with 3rd parties or not. Wishing businesses development – success – prosperity.


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