Here are the risks of outsourcing:
Like any other plans, decisions and strategies, outsourcing also comes with some risks that could be harmful to your business. See how these potential pitfalls may affect you:
Home Field Advantage
If you have a team of competent employees and a broad labor pool in your local office that could do the tasks you need, then acquiring a team outside your company would not make sense.
Critical and Core Business Competencies
Critical and core business competencies define your brand. It is only rightful that business judgment should be done by the owners alone. and not with any third-party. Therefore, business core competencies should never be delegated or outsourced.
A need for physical interactions – office collaborations
There are times when planning needs collaborations between teams or department and it is much easier when everyone is in the same room, sharing ideas and brainstorming to create or come up with a faster result. If your business runs a lot of projects that need physical interactions between your employees,
then outsourcing is not for you.
Security threats
Security, intellectual property and privacy concerns are present in every business whether local or outsourced. It imposes a higher risk for outsourced resources on these since you will not be there to check on them round the clock. Establishing sophisticated security tools in place for your system could help eliminate these threats both locally and outsourced.
Cultural Nuances
Every company and individuals have their own culture. Oftentimes in an outsourcing setup, people come from different backgrounds, different countries even and would have a different culture. One thing could be ethical for one but is not acceptable to others. This could impose a challenge to the business, as it could delay a project or could cause inefficiencies at work. Understanding and awareness of different
cultures will make a huge impact on the success of outsourcing.
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