Onshore and Offshore Outsourcing

Today’s business world is going through a massive and dynamic change, particularly when it comes to outsourcing various projects. Earlier, there used to be a conflict about whether to do the job through in-house workforce or outsource it to a third party vendor. However, now, many rapid changes have affected the global business, and outsourcing has been accepted as a popular business trend. So the conflict has now shifted to, whether offshore outsourcing or onshore outsourcing will be better than the business.

Onshore outsourcing refers to when the job is sent on locally based service or product supplier while offshore outsourcing is exporting the business process outside the country where cheaper labor cost is available. Both these business models are very popular even if each one has its own plus and minus points that can significantly affect a business.

Onshore outsourcing is all about outsourcing your projects within your own country. It does not impose as much risk as offshore outsourcing, but the benefits of this business model are not as great and as gratifying as its foreign equivalent. The biggest advantage of onshore over offshore is its geographical advantage. As onshore outsourcing is limited to only your own country, you can easily discuss the problems and get feedback of your outsourcing partner in a person meeting.

An onshore outsourcing partner may also be a company sitting next to your office. So you can easily contact them every day and even supervise their operation. Furthermore, when it comes to intellectual property rights, the same legal rules are applicable for both of you. So, it will be easy to deal with the legal or any other issues related to ownership of intellectual properties.
Offshore outsourcing is a rapidly growing trend of industry. It beats onshore outsourcing when it comes to costing efficiency.  Usually, it is cheaper to outsource the work for foreign companies as compared to the companies in your own country. You can save around 50 percent or more to get the whole project done. However, offshore outsourcing is more applicable to minor businesses because it has higher confidentiality risks.

Offshore outsourcing may have more risk, but if you choose your vendor cautiously and wisely, success is not far from you. Offshore outsourcing is rapidly picking up pace in the global business due to the great advantages it provides to every small, opening or even big business. Both the onshore and offshore outsourcing models are designed to perform effectively and provide success and profit. So finally, it will be your decision on which of these models to choose for your business.

written by for IT Services section(s).