The Best Outsourcing Success Stories of All Time
Startups and big companies alike need to consider budget management alongside hiring the best team for their developing products and services. Software development alone can cost around $60,000 annually. This a minimum cost and can increase based on the time spent on the project and other required services.
Companies need not depend on local and in house talent alone. Some of the most successful businesses and brands employed outsourcing in order to delegate specific tasks to expert companies. Here are some of the big names that found outsourcing successes.
International Names
Outsourcing is a strategy that companies like Procter & Gamble (P&G) and Unilever have used to their advantage. As a product company, P&G must release items before their competitors. In order to address this necessary strategy, they outsourced some of their R&D activities. This move led to a 60% increase in innovation productivity. More than $10 billion in revenue came from 400 new products. This prompted P&G to delegate half of its product innovation towards outsourcing success.
Unilever’s expansion includes operations across 24 countries—all of which were using multiple enterprise resource planning (ERP) systems. But in 2005, the company’s leadership team decided to integrate these multiple ERPs into a single system that would be used across Europe. Such an endeavor required a team of experts, so they outsourced this project to another company. As a result, Unilever was able to save € 700 million annually in its operational activities.
Delegating Important Backend Tasks
For Bridget Gibson, controller of Augustana Care Corporation in Minneapolis, her job manages 17 payrolls that all have varying pay dates and benefit packages. The non-profit care provider has also increased its senior care facilities and has included a number of new employees that will receive its benefits from Augustana. Payroll is considered the company’s biggest expense, with $35 million paid to its 1,500 employees.
Gibson was aware of the in-house processing within Augustana. But she soon discovered the laborious and complex execution of many tasks, such as entering the payroll three times: first into a time clock, second into the payroll software, then lastly into the general ledger software. Since everything was done manually, there was a larger likelihood for human error. Gibson decided to outsource its payroll and other related services. Outsourcing success was found through Minneapolis’ Payroll Control Systems (PCS), which handles Augustana’s payroll processing, tax filing, time clock, direct deposits, routine and custom reporting through an integrated human resources software. The program removes the need for redundant data entry and the likelihood of human error.
Startup Successes
Even tech startup companies have relied on outsourcing companies to accelerate their current successes. Github’s CEO and co-founder Chris Wanstrath met Scott Chacon in San Francisco and saw how Scott had the right understanding of Gits. From there, Scott wrote Github’s backend as an outsourced resource before he became the company’s CIO.
Popular work messaging app, Slack, can credit its sleek and functional design to an outsourced company. During the company’s early stages, Slack hired design firm MetaLab to redesign the logo and improve the company app and website. Apart from outsourcing success with Slack, MetaLab is responsible for the brand assets of Coinbase and Brit+Co.
Jack Ma’s Alibaba began by outsourcing its development to a US firm. The US offered the skills Alibaba required to gain a competitive edge against eBay. During this period, overseas talent had yet to meet the same skill set as the US. As a result, Alibaba successfully competed with eBay despite Chinese internet restrictions.
SeatGeek.com owner Jack Groetzinger also employs the capabilities from outsourced labor. The Manhattan-based ticket price predicting company employs contractors through Upwork (previously oDesk) and others who are based in places such as Pune Bluff, Arkansas to the Philippines.
Outsourcing in an Automobile Business
Vehicle distribution and processing company JM Family Enterprises decided to outsource all of the software, operations, and mainframe hardware as mainframe usage leveled off at $8.2 billion. To minimize such a cost, the outsourcing vendor made sure operations were optimized to ensure on time submission of month-end financial reports.
PC Manufacturer a Step Ahead
Taiwan-based personal computer company Acer employed capability sourcing to become the world’s second-largest PC manufacturer. Acer executives looked into the company’s strength and weaknesses. Branding and marketing were among their major strengths, but they decided to outsource other fields they hadn’t mastered, such as manufacturing. As a result, Acer enjoyed faster-growing sales and market share gains. The company’s 6,800 employees are less than a tenth in size compared to its main competitor.
Revealing the Benefits of Outsourcing
Sunshine Coast entrepreneur Mark McRae owns over 30 companies, alongside raising three children with his wife. Yet he managed to generate $280 million in both online and offline sales for all said businesses. He revealed that outsourcing helped him gain such figures, delegating tasks to countries such as the Philippines, South Africa, the USA, and Malaysia.
A large number of companies also report finding outsourcing success. Squawker’s partnership with an outsourcing company led to its platform solution. JPay.com employed outside developers from Israel, China, and India for their infrastructure and technology.
Discover Your Outsourcing Success
All these stories show how proper delegation and managing your outsourced processes provide guaranteed business growth and faster success. If you’re considering growing your company, then look no further than Infinit-O to provide the expertise in fields such as finance, accounting, data and research, customer service, and other modes of BPO service delivery.
Infinit-O is the trusted customer-centric and sustainable leader in Business Process Optimization to Small and Medium businesses in the Financial Services, Healthcare and Technology sectors by delivering continuous improvement through technology, data and people.
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