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Outsourcing is the delegation of
tasks or jobs from internal production to an external
entity (such as a subcontractor). Most recently, it
has come to mean the elimination of native staff to
staff overseas, where salaries are markedly lower
The concept started with Ross Perot when he founded
Electronic Data Systems in 1962.
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Offshore outsourcing more and more takes the shape
of Business Process Outsourcing, where whole business
processes (such as support and development) are outsourced.
The client is usually free to choose who provides
the outsourced business processes, while stock markets
press the company to do more for less. This requires
that managers search out the cheapest sources they
can find. In countries like India and China (primarily
Bangalore in India), companies like IBM, Microsoft,
Hewlett Packard, and Novell choose to get BPO business
services from sub-contractors in these countries or
move many development and support jobs there. Smaller
businesses can also take advantage of freelancing
on the Internet to get smaller projects done by offshore
developers at minimum cost.
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Why Business Processing Out Sourcing
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