Outsourcing in the Internet Era

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Outsourcing in the Internet Era

Outsourcing is the practices of contracting with vendors to perform human resource services and activity. Outsourcing is not new in human resource administration. Online outsourcing also is the internet-based version of outsourcing. This process is when one department, or indeed a whole area of work, transfers tasks and projects to a third party company. As they can be easily achieved through the internet, it is mostly services within IT and marketing that are most often sourced out to a third party. Examples of such tasks could be programming and web design, multi-media production, logo design or search engine optimization not forgetting services like translations, research and editorial work. In this case, online platforms can serve to simplify the process of attaining and assigning projects.

Online outsourcing also is the business process of contracting third-party providers (often overseas) to supply products or services which are delivered and paid for via the internet. Online outsourcing emerged in the early 2000s, along with advances in internet technology, as a viable option for SMEs and entrepreneurs who lacked the necessary financial resources to meet the costs associated with traditional forms of outsourcing. Outsourcing or freelancing marketplaces play a pivotal role in connecting buyers of outsourced services (small businesses and individuals) with providers of outsourced services (freelance workers).

Online outsourcing brings many opportunities both for the service contractor and the service provider. Due to varying international wage rates, costs of up to 70 percent can be achieved by Outsourcing online services from countries with high wage levels to countries with low wage levels. In particular, for small and medium sized businesses and Entrepreneurs the Online Outsourcing model brings many financial advantages, as it is these people who have to rely on a tight budget. Moreover, this can mean an additional and often more efficient source of revenue for service providers from countries with relatively low wages.

There are a few advantages of online outsourcing. Firstly, with the availability of online outsourcing, companies can focus on our core business. This is so because with the internet everything is at our fingertips. Managers can find a variety of information via the internet. Besides, online outsourcing can also help improve the skills of IT managers to find the right information to be used in the company.

Sometimes online outsourcing also has its own deficiency. Among them the organization would suffer major problem if you cannot figure out how to use this application properly. Second, loss of competitive knowledge.

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References:

• ONLINE OUTSOURCING. (n.d.). Retrieved December 4, 2012, from WIKIPEDIA, The Free Encyclopedia: http://en.wikipedia.org/wiki/Online_outsourcing
• Michael J. Kavanagh, Mohan Thite, Richard D. Johnson,. Human Resource Information Systems (Basics, Applications, and Future Directions), Second Edition.