Outsourcing: what it is and its benefits

Outsourcing: what it is and its benefits

The term "Outsourcing", originated from the English language, is formed by combining the words "out" and "source".

It refers to the practice of hiring services through an external source to meet a specific need. In other words, instead of carrying out the hiring internally, the company chooses to contract an organization specializing in the desired area.

In Portugal, outsourcing is particularly common in areas such as information technology, human resources, accounting services, and technical support.

The outsourcing market in Portugal is competitive. Our country is more familiar with this strategic option compared to other European countries, having implemented more projects in this area than neighboring countries, with half of the country's large companies regularly debating this topic.

Despite the clear prominence of outsourcing in our country, this method of hiring has become increasingly popular at both the national and international levels due to the various benefits it offers to the companies. Among these, the following stand out:

  • Cost reduction: is one of the most significant benefits. By outsourcing certain functions or processes, companies can avoid significant expenses related to hiring and training of staff.
  • Greater focus on Core Business: This allows companies to concentrate their efforts and resources on the principal activities of the business, also known as "Core Business." By assigning secondary or support functions to external specialists, the company can direct its attention to strategic areas that add more value to its main business.
  • Flexibility in needs: It also provides companies the flexibility to deal with seasonal needs or changes in demand. Instead of maintaining a constant internal workforce, which can be excessive or insufficient at certain times, outsourcing allows them to easily adjust the amount of human resources as needed.
  • Better performance: By recruiting through outsourcing, the company benefits from the knowledge and experience of professionals specialized in the field. Companies
    specialized in providing outsourcing services usually have a broad talent base and qualified human resources.

In summary, this hiring method is growing due to its numerous benefits, making it a very advantageous option for companies that intend to increase their efficiency and productivity, allowing them to acquire a competitive advantage.

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