Outsourcing Definition – What Is Outsourcing?
Have you ever wondered what the outsourcing definition is?
As entrepreneur, you’ve probably more than likely come across the term outsourcing by now and it can sort of be frustrating figuring all this out.
I’ll share with you a few outsourcing definition that I found, then I’ll share with you the way I think of it.
According to Dictionary.com, it says:
“Outsource” can be used as a verb (used with object), outsourced, outsourcing.
- (of a company or organization) to purchase (goods) or subcontract(services) from an outside supplier or source.
- to contract out (jobs, services, etc.): a small business that outsources bookkeeping to an accounting firm. verb (used without object), outsourced, outsourcing.
- to obtain goods or services from an outside source: “U.S. companies who outsource from China.”
The Business Dictionary says:
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The contracting or subcontracting of noncore activities to free up cash, personnel, time, and facilities for activities in which a company holds competitive advantage. Companies having strengths in other areas may contract out data processing, legal, manufacturing, marketing, payroll accounting, or other aspects of their businesses to concentrate on what they do best and thus reduce average unit cost. Outsourcing is often an integral part of downsizing or reengineering. Also called contracting out.
Finally here are a few relevant excerpts that I found on Wikipedia
In business, outsourcing involves the contracting out of a business process to another party (compare business process outsourcing). The term “outsourcing” dates back to at least 1981. Outsourcing sometimes involves transferring employees and assets from one firm to another, but not always.
Outsourcing includes both foreign and domestic contracting, and sometimes includes offshoring (relocating a business function to another country). Financial savings from lower international labor rates can provide a major motivation for outsourcing/offshoring.
Outsourcing Definition
From what I gathered, the “outsourcing definition” is pretty much an extension of the “outsource definition” and the way I define outsourcing is that basically if you’re starting up your business and don’t have employees yet, the tasks that you can’t do or don’t have time to do you delegate to someone else through hiring an outsourcing firm or hiring an independent contractor, also known as a virtual worker.
This also works if you are a big company, you can outsource specialized tasks that are only temporary, hence why you can’t justify hiring a full time employee just for that.
So again, my definition of outsourcing is pretty much to get someone else, better qualified than you to get the job done on a per contract basis. It could be for a day like it could be for a month, you decide.
If you’d like to get more information on outsourcing, I invite you to watch this free 59 minute webinar. In there you’ll learn how an engineer was able to get 25 hours worth of work done in a 24 hour period while working is 50 hours/week job.
What about you, what is your outsourcing definition?
