Types of Offshore Outsourcing

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At present there are four major types of work that is outsourced to other nations. These are:

  • Manufacturing
  • Business processing
  • Software
  • Knowledge Processing

A number of different kinds of jobs can be outsourced. In fact as off-shoring of work began to gain importance, companies everywhere began reviewing their existing set up and coming up with innovative ways in which it could done elsewhere. The Internet and other telecommunication advancements have also helped in the effort.

Manufacturing Jobs

As labor cost continues to be cheaper in offshore locations, most companies choose to shift their manufacturing units to countries like China where the cost is substantially less. By setting up the equipment, process flow, checks and tests, quality can be
maintained and since the location of the plant is overseas, products can be transported easily to their new destinations.

Business Processing and Customer Service

Most companies have some functions that involve data processing. It could be something as simple as payroll and salary processing or as complex as bank related work. Any data processing work can theoretically be transferred overseas after ensuring that adequate training and knowledge transfer takes place.

Customer service is another area where outsourcing has gained popularity. Since English-speaking staff is easy to find in cheaper nations, it has become a common practice to outsource call center operations to these countries.

Knowledge Processing

As more and more work began moving offshore, companies began to realize that even their high-end knowledge centric roles like analytics, market research, financial analysis and portfolio investment could be moved. Developing nations also had a large segment of skilled and well-educated individuals who could easily take on such responsibilities. As a result, a brand new set of roles have been moving offshore obliterating the earlier assumption that only mundane repetitive tasks could be moved offshore.

Software Development

Since the early 90’s it became evident that a strong concentration of software and information technology skills existed in countries like India and surrounding nations. Since then many businesses have chosen to source their software needs from such nations and major international software companies have even set up branches of their in these countries to cash in on the knowledge present here.


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