The global market has arrived in South Africa and many local companies are finding themselves up against competitors that have already re-engineered their business processes – with many of these having chosen outsourcing as a strategic alternative.
The market now requires corporate flexibility and improved operating efficiency to achieve greater economy of scale, and the outsourcing of non-core business processes is becoming an attractive option.
Dave Philips, director of CRS Technologies, points out that developments in the business environment and the workplace continue to transform remuneration into a strategic function.
And as more companies are required to divert internal resources to the strategic analysis and assessment of workforce efficiency, there is a growing need to shed the administrative and processing burden of payroll operations.
By offering flexibility and improved operating efficiency, outsourcing has become an attractive and viable option that allows companies to divert internal and human resources into their core business functions.
Outsourcing allows for the elimination of various time-consuming administrative processes and enables companies to gain a noticeable business advantage through being able to focus on the strategic aspect of running their business.
One of the most important criteria when making a decision to outsource certain non-core business functions is that for companies to clearly establish objectives and specific needs up-front.
Philips adds that companies need to ask several pertinent questions when considering outsourcing needs or an ideal partner.
These include: What functions can be effectively outsourced? What level of flexibility is needed in the engagement process, and are you likely to get this? And, most importantly, will you find a partner who fits your business’s ethical, operational and cultural values?
There are several compelling reasons to outsource non-core business functions, including reduction and control of operating costs; to improve company focus; access to world class capabilities; to free internal resources for other purposes; access to resources that are not available internally; to accelerate re-engineering and re-structuring; stabilising certain functions that have become difficult to manage or are out of control; manage cash infusion and make capital funds available; and to gain access to leading edge technology.