Reasons why outsourcing really benefits

Lower costs due to economies of scale

Ability to concentrate on core functions

Greater flexility and ability to define the requisite service more readily

Specific supplier benefits. For example, better security, continuity, etc.

Higher quality service due to focus of the supplier

Improved internal management disciplines resulting from the exercise itself

Less dependency upon internal resources

Control of budget

Faster setup of the function or service

Lower ongoing investment required in internal infrastructure

Greater ability to control delivery dates (eg: via penalty clauses)

Lack of internal expertise

Increase flexibility to meet changing business conditions

Purchase of industry best practise

Improve risk management

Acquire innovative ideas

Increase commitment and energy in non core areas

Improve credibility and image by associating with superior providers

Generate cash by transferring assets to the provider

Gain market access and business opportunities through the supplier’s network

Turn fixed costs into variable costs