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11 Successful Outsourcing Case Studies From Tech Giants

11 success stories of companies that successfully established a place in the market through outsourcing and pro tips on how they did it.

The growth in outsourcing and remote working opportunities are the silver lining among the dark clouds brought on us by the Covid-19 pandemic.

During the early stages of the pandemic, many were in a clueless situation, and many outsourcing companies faced a dip in their productivity.

But once everybody got accustomed to the situation and adopted new technological solutions, the outsourcing capabilities and business opportunities found new paths to venture.

As per a global IT outsourcing market study , the industry is expected to grow by 98 billion USD by 2024, with a Compound Annual Growth Rate (CAGR) of 5%.

Though outsourcing is a highly profitable and effective way to improve your business, there are things you should consider and learn before you implement them. Learning from the experiences of companies that have successfully done this can be an easy way to start.

After reading this blog, you will get a more comprehensive understanding of outsourcing and imbibe the tactics used by companies that run a successful outsourcing team.

Take a deep breath and dive right in.

Outsourcing Overview

Before we jump into the stories of IT outsourcing success, let’s take a quick look at the basics of outsourcing a business. We all know that outsourcing is hiring talent from the outside for a service, but there are some confusing FAQs that really need to be addressed before we proceed further.

Why Do You Need to Outsource?

You may be a talented entrepreneur with high business acumen and technical skills, but you can’t run a business all by yourself. For moving that mountain you need a team.

Hiring a team of developers near you would be costly and sometimes the quality of talent available to a business at its early stages would be not up to the mark.

Those are the first signs that push you to the idea of outsourcing your business. The world has a talent pool far greater and economically feasible than local talent.

Check out: 10 Reasons Why You Should Outsource Your Mobile App Development

When Do You Need Outsourcing?

The stage at which a company needs to outsource is completely dependent on it; some companies need to outsource in the initial stages like Alibaba, where some prefer to outsource after they have established a proper foundation.

The time to outsource depends on a few factors:

• The quota of talent you can gather by outsourcing without disrupting your process.
• The economic condition of the company.
• Whether you can find quality service offshore.
• Does outsourcing support your business plan.

You have to first examine all the possibilities and then determine if outsourcing is the right way to go.

See how you can outsource product development in the right way and avoid some common costly mistakes.

What Should You Outsource?

A business has so many platforms that make it function, such as customer support, product development, branding and so on.

But the thing is, you can’t outsource all of these platforms.

You can’t outsource something because you don’t feel like it; you have to farm out the things which don’t affect your core business and outsource them if they need to be outsourced. The things that companies usually outsource are:

• Special set of skills that is required at a definite point in time.
• For doing repetitive tasks.
• For expertise knowledge.

There are a lot of things to keep in mind while outsourcing; otherwise, it may result in the failure of the company as a whole.

Outsourcing Success Stories

Finding examples of successful outsourcing companies is easy in this technological era. Many companies have grown their businesses by adopting remote work and outsourcing into their business plan. Here are a few successful outsourcing examples:

1. CuriosityStream

Curiosity stream is a global independent media company and video-on-demand streaming service that dipped their feet into the possibilities of outsourcing in 2019.

They hired a team of six programmers who helped them develop the video feature that increased the number of hours watched. This helped them increase their overall productivity and reduce the cost required to make the software.

Like most of the entrepreneurs who are reading this blog, the CuriosityStream team drew inspiration from the many successes of other companies and learnt the ways to implement a successful outsourcing programme.

Based on the interviews of Andre Silva, CTO of CuriosityStream, the advice he gives other entrepreneurs is to figure out ways to integrate the offshore team with the on-site team.

2. StudyTube Hires

StudyTube is an online education platform based in the Netherlands, which relies on nearshore programmers. They collaborated with part-time engineers in the early stages but soon realised it was not meant to be.

So they hired Ukrainian developers and this nearshore outsourcing concreted their chances to grow their business. With a secured investment totalling €1,500,000, they are still scaling constantly.

We are all familiar with Skype, the telecommunication application that specialises in video and voice calls between devices via the internet.

European web developers were employed for most of the software development. Skype claimed that it needed professional web development for its product idea, so it chose outsourcing as an option.

The 300 million monthly active users and almost 1 billion downloads can vouch for the success they have achieved through outsourcing.

Among the success stories of companies from outsourcing, Slack has a growth story on its own. The company hired a Canadian design team MetaLab to help with developing a successful product from the beta version.

The company raised a total valuation of $5billion in July 2017, and they are still growing. The company gathered more investments by outsourcing website design and mobile app development .

Slack’s rag to riches story is a great example of the best IT outsourcing success stories. MetaLab provided the Slack team with valuable feedback, which helped them create a tool that reached 15,000 users in 2 weeks of its launch.

GitHub provides hosting for software development version control using Git. This subsidiary of Microsoft offers version control and source code management (SCM) functionality of Git and adds its own features to the mix.

GitHub is one of the companies that outsourced its MVP . They hired a backend developer to build the backend of the product.

6. Whatsapp

Whatsapp has over 1.5 billion active users in over 180 countries, and this highly successful company is no new to outsourcing. With the small cash reserve they had, founders Jan Koum and Brian Acton decided the best way to develop the product was through outsourcing .

So they hired Russian app developers to minimise operational costs and get highly skilled developers. Whatsapp has become the third most downloaded android app on Google Play Store and has an active user base of over 2 billion.

7. Waitwhile

Created by two ex-Googlers, Waitwhile solves a common problem for the people, waiting in line for a call. We hate being held up at “receiver point” for hours on end with an infuriating tone that rings periodically. Waitwhile is solving that problem with the help of an AI; will wait for you while you do your productive work.

Waitwhile initially had a base app that the initial users well received, and scaling became imminent. But they were limited by their technology; that is when they outsourced the work to NeoITO .

We upgraded their old framework, which was made from AngularJS, and gave it the necessary features to support high scaling possibilities. With over 2 million hits, Waitwhile has announced its position in the market.

Dig Deeper : Software Outsourcing For Startups: An In-Depth Guide

8. Widget Brain

Widget Brain is a Netherlands-based startup company and is a pioneer in AI driven workforce management. It is one of the hottest startups in the Netherlands.

Outsourcing changed the game for them when they hired five Ukrainian developers, the quality of workforce they received at a feasible rate helped them in their growth as a business.

Software outsourcing has helped Widget Brain gather 2 million dollars in investment to expand worldwide.

9. Oktopost

Oktopost is a social media management platform launched in 2013. They operated in Israel, Ukraine and the US, with an employee count of 22.

In 2018, Oktopost hired software developers through Daxx that helped them extend their roadmap and helped them scale their business. The offshore development team has certainly helped them develop services they struggled with in the earlier stages.The outsourced work helped them improve their business roadmap and attract more investments and customers .

10. Alibaba

You can never leave out Alibaba from the list of successful outsourcing examples. Jack Ma, the co-founder of Alibaba Group, is a strong proponent of an open and market-driven economy.

Jack Ma initially outsourced his software development work to the US. This move was to appeal to a bilingual audience and to hire skilled tech professionals , which he did not find locally.

This did not go in vain as Alibaba now accounts for the 60% share in the Chinese e-commerce market.

11. TransferWise

TransferWise is a global money transfer company that says they don’t do offshoring, outsourcing or use consultants. However, the company admits to having “independent workers” who are an integral part of the core team working remotely.

The company’s remote team is dispersed across Estonia and Ukraine. Ukrainian technicians are sought out for their quick technical reflexes and the skills they put forward.

Read More : Outsourcing SaaS Product Development: A Non-tech Founder’s Guide

There lies a common misconception in people’s minds that outsourcing leads to poor management practices and below-par services for the customers. To reap the benefits of outsourcing, you need to hire the right people that can meet your requirements.

The below blog will help you choose the right partner for outsourcing your software development .

To find the right outsourcing partner, you need to know the type of outsourcing model ideal for your business. Proper utilisation of outsourcing helps boost a business’s efficiency and economy.

Want to know more about how you can benefit from outsourcing? Read our Case Studies and Book a Free Consultation today!

What are some notable outsourcing success stories?

Discover how tech giants achieved success through strategic outsourcing partnerships.

How did outsourcing benefit tech giants?

Outsourcing allowed tech giants to tap into specialized skills and cost efficiencies.

Which industries witnessed successful outsourcing?

Industries like IT, software development, and customer support thrived with outsourcing.

What lessons can we learn from these case studies?

Case studies offer insights into how strategic outsourcing can drive innovation and growth.

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Gokul is a B2B Content Specialist who writes customer-focused content for startups, scaleups and enterprises to supercharge their growth.

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How Apple Achieved a Legendary $2.98 Trillion Fortune by Outsourcing | Case Study

In the annals of technological innovation, Apple Inc. stands as a testament to what strategic decisions and visionary leadership can achieve. From its humble beginnings in a garage to becoming a three trillion-dollar behemoth, Apple’s success narrative is a tale woven with threads of innovation, design excellence, and a shrewd approach to outsourcing. In this extensive case study, we embark on a journey to dissect the intricate layers of outsourcing strategy to extract valuable lessons for businesses aiming at sustainable growth.

Apple’s evolution is a saga of perpetual reinvention. Founded in 1976 by Steve Jobs, Steve Wozniak, and Ronald Wayne, the company started as a player in the personal computer industry. [ 1 ] Fast forward to the present day, and Apple Inc. has transformed into a global powerhouse, setting industry benchmarks and captivating consumers with its innovative products.

Table of Contents

#1: outsourcing: apple inc.’s manufacturing backbone, a: challenge: scaling up production.

As Apple Inc. ventured into the realm of consumer electronics with products like the iPhone, iPad, and MacBook, the challenge of meeting unprecedented demand emerged. In response, Apple strategically embraced outsourcing, forging key partnerships to tackle this manufacturing conundrum.

Foxconn, also known as Hon Hai Precision Industry Co., Ltd., emerged as Apple’s manufacturing linchpin. With its headquarters in Taiwan, Foxconn became the largest electronics contract manufacturer globally. The statistics tell a compelling story—Foxconn’s revenue in 2021 reached a staggering $214 billion, ranked 20th in the 2023 Fortune Global 500—a significant portion of which was attributed to its collaboration with Apple.

B: Benefit: Cost Savings and Efficiency

The outsourcing strategy wasn’t merely about meeting demand but a calculated move to optimize costs. According to industry reports, the cost of manufacturing an iPhone X was estimated to be around $370, with the device retailing at $999. This exemplifies the cost-effectiveness achieved through outsourcing, particularly with partners like Foxconn, renowned for their efficiency in mass production. In 2023, Apple Inc. launched the titanium-based iPhone 15 Pro Max, manufactured at $558 and currently retailing from $1199 to $1599.

#2: Leveraging Global Talent and Expertise

A: challenge: the pursuit of excellence.

Apple’s commitment to excellence extends beyond its sleek product designs to encompass the entire user experience. To provide this seamless experience, Apple Inc. strategically tapped into a global talent pool, seeking specialized expertise through outsourcing.

Beyond manufacturing, Apple’s collaboration extended to specialized components. For instance, Apple Inc. sourced its A-series chips from Taiwan Semiconductor Manufacturing Company (TSMC), a world leader in semiconductor manufacturing. In 2022, TSMC’s revenue soared to $63 billion, a testament to its pivotal role in Apple’s supply chain.

B: Benefit: Innovation and Quality Assurance

Outsourcing to experts meant that Apple could integrate cutting-edge technology seamlessly. The A-series chips, fabricated by TSMC, consistently pushed the boundaries of performance, ensuring that Apple’s devices were aesthetically pleasing and technological marvels. This collaborative approach contributed to Apple’s reputation for innovation and quality assurance.

#3: The Design Imperative

A: challenge: nurturing creativity.

Apple’s design philosophy is synonymous with elegance and innovation. Outsourcing became a tool to liberate internal resources, allowing Apple’s design team to focus solely on what they do best—creating iconic products.

By outsourcing components and manufacturing, Apple’s in-house design team gained the freedom to innovate without being bogged down by production intricacies. Statistics reveal the impact—Apple’s design-led approach contributed to a brand value of $263.4 billion in 2022, making it the most valuable brand globally.

B: Benefit: Unleashing Creativity

This focus on design resulted in visually stunning products and fostered a culture of innovation within Apple Inc. The iPhone’s iconic design, for instance, not only captured the market but set a new standard for the entire industry. The freedom to innovate became a catalyst for Apple’s success.

#4: Outsourcing in the Digital Age

A: Challenge: Navigating the Digital Landscape

As the digital landscape evolved, Apple Inc. faced the challenge of staying at the forefront of software development. The solution lies in strategic outsourcing partnerships that complement Apple’s internal capabilities.

Apple’s collaboration extended to software development, with partnerships and acquisitions reinforcing its commitment to excellence. For instance, the acquisition of Beats Electronics in 2014 for $3 billion not only bolstered Apple’s presence in the audio industry but also brought the expertise of Beats’ software engineers into the Apple ecosystem.

B: Benefit: Software Synergy

Outsourcing software development allowed Apple to harness the collective expertise of a global talent pool. The collaborative synergy translated into user-friendly interfaces, seamless integration across devices, and a robust app ecosystem. The strategic outsourcing of software development became a key ingredient in Apple’s recipe for success in the digital age.

#5: Ethical Considerations and Corporate Responsibility

A: challenge: balancing success and responsibility.

While the outsourcing strategy contributed significantly to Apple’s success, it also brought attention to ethical considerations and corporate responsibility. Reports of challenging working conditions at some manufacturing partners prompted Apple to reevaluate its approach.

Apple’s response to these ethical concerns showcased adaptability and a commitment to responsible business practices. According to Apple’s Supplier Responsibility Progress Report in 2022, the company conducted over 1,100 supplier assessments, addressing issues related to labor practices, environmental impact, and ethical sourcing.

B: Benefit: Ethical Leadership

Addressing ethical concerns associated with outsourcing elevated Apple’s corporate image. The commitment to responsible business practices resonated with consumers and set a precedent for the industry. This ethical leadership became a crucial element in Apple’s success story.

Final Verdict: The Outsourcing Symphony

In the grand symphony of Apple’s success, outsourcing plays a pivotal role as a harmonious melody that elevates the entire composition. The strategic outsourcing of manufacturing, expertise, design, and software development has propelled Apple to unprecedented heights and is currently worth almost $3 trillion. This in-depth exploration attests to the transformative power of strategic outsourcing.

* Lessons Learned: A Call to Action

1. Strategic Partnerships : Identify and cultivate strategic outsourcing partnerships that align with your business goals and values. Partnering with industry giants like Foxconn and TSMC gave a solid foundation.

2. Focus on Core Competencies : Outsourcing allows you to concentrate on your core competencies, whether design, innovation, or marketing. As exemplified above, streamlining the design process can lead to market-leading products.

3. Global Talent Pool : Tap into a global talent pool to access specialized expertise and stay at the forefront of innovation. Partnerships with global leaders, such as TSMC in semiconductor manufacturing, were proven to be instrumental.

4. Ethical Outsourcing : Prioritize ethical considerations and corporate responsibility in your outsourcing practices to build a positive brand image. As demonstrated above, regular assessments and a commitment to transparency can set industry standards.

5. Adaptability : Be adaptable and responsive to challenges, iterating your outsourcing strategy to meet evolving demands. Responsiveness to ethical concerns showcases the importance of adaptability in sustaining success.

In the business landscape, the outsourcing symphony can be the key to sustained success. As businesses consider their growth strategies, the above case study serves as a compelling testament to the transformative power of strategic outsourcing. Embrace the symphony, conduct it with precision, and let the echoes of success reverberate through the corridors of your organization.

Get in touch with us at CodersOnFire and start outsourcing your software development projects to gain monumental success in your business.

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5 Inspiring Companies Case Studies of Outsourcing that Have Successfully Benefited

• September 25, 2023

In today’s fiercely competitive business landscape, companies are continually seeking strategies to streamline operations, enhance efficiencies, and maximise profits. One strategy that has consistently proven to yield remarkable results is outsourcing. Outsourcing, at its core, is the strategic move of delegating specific business processes or functions to external service providers. While the mere mention of the term often conjures up concerns about job losses or quality compromises, when executed thoughtfully and strategically, outsourcing can become a game-changer for businesses. The trick lies in knowing what, when, and how to outsource.

Consider the tech titan, Apple. Few are aware that the company outsources the manufacturing of its iconic products, yet this move has allowed Apple to focus on its core strengths – design and innovation. Or take the case of Slack, the collaboration hub, which entrusted its initial app development to an outsourced team, resulting in a product that is now used by millions around the globe. Such tales of triumph aren’t limited to just the tech industry. From startups to established conglomerates, businesses across sectors have harnessed the power of outsourcing, leading to growth, innovation, and the ability to tap into global talent.

In this blog, we delve deep into five inspiring case studies of companies that have successfully outsourced various aspects of their operations. These stories serve as a testament to the transformative power of outsourcing when approached with clarity, diligence, and a vision for the future. So, whether you’re a business leader contemplating the outsourcing leap or a curious enthusiast keen to understand its real-world impact, buckle up for a journey into the world of strategic partnerships and unparalleled growth.

Benefits of Outsourcing for Startups and Small Businesses

Outsourcing is a strategic move, employed by startups and small businesses alike, to leverage external expertise and optimise internal resources. Examining the case studies of outsourcing reveals a consistent pattern: businesses transforming their operations, enjoying substantial cost-savings, and witnessing increased flexibility. Below, we delve into these benefits in detail.

Cost-Saving

Outsourcing certain business processes can significantly reduce operational costs. For instance, IT outsourcing, as evidenced by numerous IT outsourcing case studies, has proven more cost-effective than maintaining an in-house IT team. By opting for either offshore or onshore outsourcing, companies can tap into global talent without bearing recruitment and infrastructure costs.

Focus on Core Business Functions

For most companies, especially startups, what’s paramount is directing energy towards their core competencies. By outsourcing peripheral functions like IT, KPO, or BPO processes to third-party vendors, they can concentrate on innovating and driving business growth.

Rapid Business Transformation

Smart outsourcing is synonymous with business transformation. Case studies of outsourcing have shown that startups experience exponential growth by leveraging BPO and KPO outsourcing. For instance, outsourced customer service success stories highlight improved customer satisfaction rates, directly impacting a company’s ROI.

Mitigating Risks with SLA and Vendor Management

Outsourcing isn’t devoid of challenges. However, with a well-defined SLA in outsourcing, companies can ensure they get the desired service quality. Effective vendor management, along with understanding the pitfalls to avoid when outsourcing, reduces potential risks. Furthermore, proper agreements with vendors emphasise risk management in outsourcing, ensuring both parties are aligned in terms of expectations and deliverables.

Considering the factors influencing successful outsourcing, cultural compatibility plays a pivotal role. Outsourcing benefits aren’t merely transactional but evolve into strategic partnerships when businesses and vendors operate in synergy. This synergy is often underscored by aligned cultural values, ensuring smoother communication and project execution.

Industries most likely to outsource include IT, customer service, and finance. Analysing successful offshore outsourcing stories reveals that IT is a dominant player, with startups benefiting immensely from tapping into global IT talent pools.

Key Metrics to Measure Outsourcing Success

As companies globally have embraced outsourcing as an integral component of their business strategy, the demand for quantifiable measures to assess its efficacy has intensified. Case studies of outsourcing across IT, KPO, and BPO segments consistently underscore the importance of these metrics. Here’s a comprehensive overview.

Return on Investment (ROI)

Perhaps the most pivotal metric, ROI evaluates the profitability of an outsourcing venture. To calculate outsourcing ROI, you’ll employ the formula:

A high ROI indicates a successful outsourcing strategy , with considerable cost-saving outsourcing benefits. For instance, many IT outsourcing case studies show an ROI surge, highlighting the global outsourcing benefits when tapping into an offshore talent pool.

Service Level Agreement (SLA) Adherence

An SLA in outsourcing functions as a binding contract between the company and the vendor. It stipulates benchmarks for quality of service, timely delivery, and other deliverables. Monitoring SLA compliance is paramount as it gauges the vendor’s efficiency and effectiveness. In cases where SLA metrics aren’t met, risk management in outsourcing comes into play, with companies and third-party vendors revisiting the outsourcing agreements to mitigate issues.

Operational Efficiency

Operational metrics offer insights into the efficiency of an outsourced process. The more streamlined and error-free the process, the higher the efficiency. Companies often look into BPO success stories to identify best practices that yield optimal operational efficiency.

Quality of Service

Especially critical in sectors like IT and customer service, the quality of service is a direct indicator of vendor competence. For instance, outsourced customer service success stories always emphasise consistent high-quality interactions as a pivotal factor.

Several factors influence successful outsourcing. Vendor management, outsourcing strategy, and cultural compatibility play significant roles. It’s also beneficial to understand the pitfalls to avoid when outsourcing and the steps in the outsourcing process. By keeping these metrics at the forefront and leveraging insights from successful outsourcing examples, companies can enhance their chances of reaping the myriad benefits outsourcing offers.

Factors Influencing Successful Outsourcing

An overwhelming majority of case studies of outsourcing reiterate the foundational importance of selecting the right vendor. This choice directly impacts the company’s business transformation and ability to achieve the desired ROI. A well-chosen vendor offers not only expertise in IT, KPO, or BPO segments but also cultural compatibility in outsourcing. This ensures that both the outsourced team and the in-house team work cohesively, enhancing the overall business process.

Case studies reveal that companies that delve into third-party vendors’ track records, specifically assessing their previous IT outsourcing case study or KPO outsourcing experiences, often fare better. Vendor management, in this context, involves a deep dive into the vendor’s past projects, their outcomes, and client testimonials.

Importance of Risk Management

Outsourcing, while laden with benefits, isn’t devoid of challenges. As several small business outsourcing success stories highlight, effective risk management in outsourcing is crucial. Companies must anticipate potential issues, from service disruptions to data breaches, and strategize accordingly. Whether it’s onshore outsourcing or offshore outsourcing, having a robust risk management framework fosters business agility, allowing companies to adapt to unforeseen challenges swiftly.

Drafting a Comprehensive SLA (Service Level Agreement)

The SLA plays a pivotal role in setting the tone for the entire outsourcing relationship. An SLA in outsourcing should meticulously outline each party’s responsibilities, deliverables, timelines, and quality benchmarks. It’s not just about having an agreement; it’s about ensuring both parties are unequivocally on the same page. Case studies of outsourcing frequently point out that ambiguities in SLAs often lead to disputes, thus emphasising clarity.

Success Rate Based on Key Factors

To drive home the importance of these factors, a review of successful outsourcing examples showed the following correlations:

An interesting aside from these studies was the observation that no discernible influence on a company’s ability to outsource effectively. It serves as a gentle reminder that while data is invaluable, not all correlations translate to causations in the business world.

In addition, there are other elements, albeit more nuanced, that influence outsourcing success. Cultural compatibility in outsourcing, for instance, goes beyond mere language compatibility. It’s about understanding work ethics, business etiquette, and more. Similarly, an outsourcing strategy isn’t just about cost-saving outsourcing; it’s also about tapping into global talent pools, gaining access to cutting-edge technology, and driving outsourced innovation.

While the lure of cost-saving and operational efficiency drives many companies towards outsourcing, the true markers of success lie in a meticulous vendor selection process, proactive risk management, and a crystal-clear SLA. Keeping an eye on these factors, and drawing insights from case studies of outsourcing, can significantly enhance the probability of a successful outsourcing endeavour.

Companies that Failed Due to Bad Outsourcing

While many companies revel in the outsourcing benefits, achieving cost-saving, business agility, and tapping into the global talent pool, there’s a shadowy side to this strategy. It’s paramount to understand this perspective, as echoed by numerous case studies of outsourcing gone wrong.

The Importance of Vendor Selection

One of the most cited reasons for outsourcing challenges stems from hasty or ill-informed vendor selection. It’s not just about the cost-saving outsourcing offers, but ensuring the vendor can align with the company’s IT, KPO, or BPO needs. A misaligned vendor can lead to service disruptions, and ineffective risk management, and can sabotage ROI.

For instance, one notable IT outsourcing case study revolves around a prominent tech company that aimed to benefit from offshore outsourcing. However, due to inadequate third-party vendor vetting, they faced significant challenges in product quality and missed deadlines. This ultimately eroded their market share, a blunder that cost them dearly.

Pitfalls in SLA and Agreements

A strong SLA (Service Level Agreement) acts as the backbone of successful outsourcing. Yet, some companies, in their quest for cost-saving, often overlook the intricacies of drafting a comprehensive SLA. A case in point involves a prominent e-commerce company. Their outsourcing agreements lacked clarity on quality benchmarks and timelines, leading to operational inefficiencies. This BPO blunder stalled their business transformation, resulting in substantial financial losses.

Impact of Bad Outsourcing

To comprehend the magnitude of these challenges:

It’s intriguing to note that while data from various industries shed light on these pitfalls, seems unrelated. This serves as a reminder that in the complex world of outsourcing, it’s essential to separate actionable insights from unrelated data.

Learn from the Mistakes: For every company that struggled due to improper outsourcing practices, there’s a lesson to be imbibed. While outsourcing can offer numerous benefits for startups, and there are myriad successful outsourcing examples, it’s equally crucial to be aware of the pitfalls to avoid when outsourcing.

From the aforementioned examples, two primary takeaways emerge:

• Meticulous Vendor Management : Companies must delve deep into vendor histories, previous projects, and client feedback. This ensures not just cost-saving, but also quality assurance and project success.
• Comprehensive SLA Drafting : Beyond just having an SLA, it’s pivotal to ensure its clarity and comprehensiveness. This avoids ambiguities and sets the tone for a successful outsourcing partnership.

Navigating the outsourcing landscape requires a balanced approach. While the benefits are substantial, the risks are real. And as many case studies of outsourcing reveal, it’s those who learn from the mistakes of others that truly harness the power of effective outsourcing.

5 Inspiring Successful Case Studies of Outsourcing

Amidst these narratives, it serves as a reminder that amidst vast data and strategies, not all information holds weight. 

A Startup’s Rapid Rise Through BPO

A newly launched tech startup, eager to focus on its core competencies, leveraged business process outsourcing (BPO) to handle customer inquiries. This decision propelled them from obscurity to being a market frontrunner in under a year. Their success story epitomises the benefits of outsourcing for startups. By entrusting BPO specialists, they enjoyed enhanced business agility, allowing them to swiftly scale operations and tackle the challenges thrown their way.

IT Outsourcing Paves the Way for Company Evolution

One particular company stands out in the myriad IT outsourcing case studies, demonstrating business transformation through outsourced IT. They established a strategic partnership with an offshore IT vendor, achieving both cost-saving and innovation. The collaboration not only facilitated them in updating their outdated systems but also fostered a culture of continuous learning and adaptation.

Small Business Success via KPO

In an era where data is king, a local retailer turned to Knowledge Process Outsourcing (KPO) to analyse their sales data. The insights derived transformed their marketing strategy, leading to a 200% increase in sales. Their story serves as a testament to the power of KPO outsourcing even for small businesses, and how it can be the linchpin for outsized success.

ROI Boost through Vendor Acumen and Clear SLAs

In an increasingly competitive landscape, a global firm stood out by optimising cost-saving and driving an impressive ROI. Their success boiled down to two core strategies: impeccable vendor selection and a meticulously crafted SLA. By forging clear outsourcing agreements with their third-party vendors, they set the stage for transparent communication, reduced risk, and ensured timely delivery – all pivotal for achieving a stellar outsourcing ROI .

Company, Business Transformation, and BPO

Among the multitude of case studies of outsourcing, one narrative intertwines various SEO Entities seamlessly. A company, on the brink of stagnation, undertook a holistic business transformation. They outsourced their backend processes to a BPO firm while also revamping their in-house talent pool. The result? A rejuvenated business model boosted efficiency and skyrocketed profits. Their story underscores the essence of business agility through smart outsourcing decisions.

Snapshot of Successes in Outsourcing

Outsourcing success isn’t just about cost-saving or tapping into a global talent pool. As these case studies of outsourcing reveal, it’s about strategy, insight, and above all, understanding one’s business needs deeply.

In reflecting on these five case studies, it’s abundantly clear that successful outsourcing goes beyond mere cost-cutting. It’s a strategic decision, interwoven with innovation, adaptability, and forging beneficial partnerships. These companies, irrespective of their sizes and industries, harnessed the power of outsourcing to scale, transform, and flourish. They have shown that with the right vendor selection, clear SLAs, and a deep understanding of one’s own business needs, outsourcing can be a catalyst for growth and transformation. For businesses on the fence about embarking on their outsourcing journey, these stories serve as both inspiration and testament to what’s achievable. As the corporate landscape continues to evolve, the pivotal role of smart outsourcing decisions, as showcased by these companies, cannot be understated.

What is outsourcing and why do companies do it?

Outsourcing refers to the practice where businesses delegate certain tasks or functions to external organisations, rather than handling them in-house. Companies do this to reduce costs, access specialised expertise, increase flexibility, and focus on core competencies.

How does outsourcing affect the bottom line?

Outsourcing can positively impact the bottom line by reducing operating costs, improving efficiency, and accessing specialised services at competitive rates. However, if not managed correctly, it can also introduce additional expenses or reduce service quality, impacting profitability.

Are there any famous companies that have succeeded with outsourcing?

Yes, many prominent companies like Apple, IBM, and Nike have successfully leveraged outsourcing. For instance, Apple outsources manufacturing of its products to suppliers like Foxconn in Asia while focusing on design and marketing in-house.

What are the key benefits of business process outsourcing?

The key benefits include cost savings, access to specialised expertise, scalability, flexibility in managing resources, improved efficiency, and the ability to focus on core business functions.

What are the potential risks involved in outsourcing?

Risks include potential loss of control over the outsourced function, cultural and communication challenges, compromised quality of work, increased reliance on third parties, and potential data security concerns.

How do I choose the right outsourcing partner for my business?

To choose the right outsourcing partner, consider their expertise, track record, cultural fit, technology and infrastructure, cost-effectiveness, and communication skills. Requesting references and conducting pilot projects can also help in decision-making.

How has IT outsourcing transformed modern business?

IT outsourcing has enabled businesses to quickly adapt to technological advancements without substantial investments in infrastructure. This practice has provided scalability, access to specialised expertise, cost-effectiveness, and the ability to innovate and remain competitive.

What is the difference between onshore and offshore outsourcing?

Onshore outsourcing refers to contracting services within the same country as the business. Offshore outsourcing involves contracting services to a provider in another country, often to take advantage of lower costs or specific expertise.

How can I measure the success of my outsourcing efforts?

Success can be measured by assessing cost savings, quality of delivered services, attainment of predefined objectives, level of innovation achieved, business growth, and feedback from internal stakeholders.

What are the best practices in vendor management and outsourcing agreements?

Best practices include clearly defining scope and expectations, establishing strong communication channels, setting measurable KPIs, monitoring and reviewing performance regularly, ensuring contractual clauses cover data security and compliance, and building a relationship based on trust and mutual benefit.

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• Exploring Outsourcing Case Studies: Learning from Real-World Examples
• Outsourcing

A study of the global market for IT outsourcing predicts that the sector will expand by 5% per year, reaching $98 billion in value by 2024 . Outsourcing case studies give us a fascinating peek into how businesses have used outsourcing to their advantage. These real-life stories help us understand the ins and outs of outsourcing, especially in the realm of IT. 

In this article, we will dive into some case studies on outsourcing to extract valuable lessons from which any business can benefit. 

Table of Contents

When and Why Do You Need to Outsource?

Outsourcing is a business strategy that can offer some real advantages when used wisely. Knowing when and why to outsource is essential for companies looking to streamline their operations, boost efficiency, and stay focused on what they do best.

When to Outsource:

Here are the conditions where you can use the option of outsourcing:

• Lack of In-House Skills: Outsourcing can fill that gap effectively if you don’t have the right skills in-house for a particular job.
• Expensive Operations: For tasks that eat up a lot of resources or require lots of labor, outsourcing can lead to significant savings.
• Time Crunch: When facing tight deadlines or needing round-the-clock support, outsourcing can provide the extra hands and 24/7 coverage you need.
• Seasonal or Variable Workloads: If your workload goes up and down throughout the year, outsourcing can help you handle busy times without overburdening your in-house team during slower periods.
• Focus on What Matters: If your goal is to concentrate on your core business and key strategic initiatives, outsourcing less critical tasks can free you up to do just that.

Why Outsource:

The key reasons for outsourcing are given below:

• Saving Costs: Outsourcing often means spending less on labor and operations. Tasks are handled in regions where labor is cheaper, resulting in significant cost savings.
• Access to Expertise: Sometimes, a business needs specialized skills that it doesn’t have in-house. Outsourcing can bring in experts who can improve the quality and efficiency of specific tasks.
• Staying on Track: When you outsource tasks that aren’t central to your business, you free up your time and resources to focus on what you’re really good at. This can make you more productive and competitive.
• Flexibility: Outsourcing can be flexible. It lets you scale your operations up or down as needed, responding quickly to market changes or shifts in your business.

Outsourcing should always be a strategic decision that aligns with your company’s goals and circumstances. When used thoughtfully, it can boost efficiency, save money, and help your business thrive in a competitive environment.

Why Outsourcing Case Studies Matter 

Before we dig into the case studies, let’s discuss why they’re so important. These case studies are like treasure troves of knowledge. 

• Show Us the Real Picture: Outsourcing case studies let us see the real experiences of businesses that took the outsourcing path. We can learn from their successes and their not-so-great moments. 
• Teach Us Best Practices: Successful case studies often reveal the strategies that led to their success. It’s like having a roadmap for your own outsourcing journey. 
• Help Us Weigh the Pros and Cons: Outsourcing isn’t all sunshine and roses. Case studies show us the benefits and potential challenges so we can make informed decisions. 

Real-Life Examples

Now, let’s explore some interesting case study on outsourcing examples, particularly in the world of IT. 

1. IBM’s IT Transformation 

IBM, a tech giant, decided to shake things up by outsourcing its IT functions in the early 2000s. They were dealing with rising costs and a messy IT setup, so they decided to get some outside help. 

Lesson: Think Strategically

IBM’s case study on outsourcing teaches us that having a clear strategy is essential. By outsourcing non-core IT tasks, they could focus on what they did best – innovation. This saved them money and made their operations more efficient. 

2. Infosys and Procter & Gamble’s Partnership 

The collaboration between Infosys and Procter & Gamble (P&G) is a classic example of successful IT outsourcing. 

Lesson: Work Together as Partners 

This case study shows us that when outsourcing partners work closely, amazing things can happen. Infosys didn’t just save P&G money; they brought innovation and flexibility to the table. It’s not just a transaction – it’s a partnership. 

3. Netflix’s Content Delivery Strategy 

Netflix, a pioneer in streaming, relies heavily on outsourcing for content delivery. 

Lesson: Stick to Your Strengths 

Netflix’s case study on outsourcing tells us that focusing on what you do best pays off. By outsourcing content delivery, they could concentrate on making great content and providing an excellent user experience. 

4. Apple’s Global Manufacturing Network 

Apple’s manufacturing network in China is an awe-inspiring example of outsourcing on a grand scale. 

Lesson: Globalization Can Save Costs 

Apple’s case study on outsourcing shows us how a global supply chain can lower costs. But it also raises questions about ethics and sustainability. Responsible outsourcing is critical. 

Success Stories: The Triumph of Skype and WhatsApp

Skype and WhatsApp, names etched in the history of communication technology, have intriguing success stories that shed light on the significance of IT outsourcing in their remarkable journeys. These companies embraced outsourcing to access specialized skills and resources, leading to groundbreaking innovations that reshaped the way we connect with one another.

Skype: Revolutionizing How We Talk

Skype, developed in 2003 through the vision of Niklas Zennström and Janus Friis, became synonymous with internet-based voice and video calls. Its story is a testament to the strategic use of IT outsourcing.

Outsourcing Highlights:

• Core Development: Skype outsourced much of its software development to talented engineers in Estonia and Sweden. This strategic move allowed them to tap into regional expertise while staying focused on their core mission.
• Scalability: As Skype’s user base skyrocketed, outsourced call centers played a crucial role in efficiently handling customer support. This approach ensured seamless global growth without compromising service quality.
• Acquisition by eBay and Microsoft: Skype’s success led to investments by eBay and, later, Microsoft. Their outsourcing partnerships remained pivotal in maintaining service reliability and quality throughout these transitions.

WhatsApp: Redefining Messaging

WhatsApp, founded by Brian Acton and Jan Koum in 2009 , revolutionized instant messaging by offering a simple, secure, and ad-free platform for billions worldwide. Its triumphant tale also incorporated strategic IT outsourcing.

• Backend Development: WhatsApp outsourced server infrastructure management to a third-party provider. This decision allowed the company to focus on enhancing user experience while maintaining a lean, agile team.
• Localized Expertise: To adapt to diverse global markets, WhatsApp engaged local outsourcing partners to address language and regional customization needs. This approach facilitated rapid expansion and user adoption.
• End-to-end Encryption: WhatsApp’s unwavering commitment to privacy and security led to the development of end-to-end encryption. They collaborated with cybersecurity experts, effectively outsourcing the specialized knowledge required to implement this feature robustly.

Skype and WhatsApp are shining IT outsourcing examples, showing how outsourcing can empower startups to compete on a global stage. They wisely leveraged external talent and resources, allowing them to channel their energies into innovation and creating exceptional user experiences. 

These success stories underscore the importance of selecting the right outsourcing partners, maintaining a clear vision, and adapting to the ever-evolving demands of the market.

Wrapping up, remember that outsourcing case studies are a goldmine of knowledge. Whether it’s IT outsourcing like IBM’s transformation or strategic partnerships like Infosys and P&G, these stories teach us a lot. The journeys of Skype and WhatsApp in the world of IT outsourcing serve as inspirations for businesses aspiring to tap into external expertise. 

When you think about outsourcing, ensure your strategy aligns with your company’s vision, work closely with your outsourcing partners, and stick to what you’re best at. Also, remember to do your homework, be flexible, and focus on scaling and standardizing. 

If you need expert guidance on outsourcing, consider Codesy Consulting . We have a proven track record of helping businesses handle the complex outsourcing world. With our help and the lessons from these case studies, you can start a successful outsourcing journey that boosts your growth, efficiency, and competitive edge in today’s evolving and dynamic business world.

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• 7 OUTSOURCING CASE STUDIES THAT YOUR BUSINESS CAN LEARN FROM

7 Outsourcing Case Studies That Your Business Can Learn From

Outsourcing is becoming a popular business strategy for companies looking to streamline their operations and increase efficiency. Whether it’s to save costs, increase efficiency, or access specialized expertise, outsourcing can offer a range of benefits to companies looking to grow and succeed.

Businesses can focus on their core capabilities while reducing expenses by outsourcing specific tasks or projects to specialized service providers. However, not all outsourcing efforts are made equal, and it’s essential to understand the best practices and potential hazards of outsourcing.

In this blog post, we’ll explore 7 outsourcing case studies that showcase real-life examples of considerable outsourcing efforts. By taking a closer look at real-life examples of outsourcing partnerships, businesses can gain useful insights into both the best practices of outsourcing and its potential pitfalls.

Table of Contents

What is outsourcing?

Why do you need to outsource, when do you need outsourcing, what should you outsource.

Outsourcing is the practice of hiring a third-party company or contractor to perform services that are traditionally handled in-house by a business. Outsourcing has grown in popularity in recent years thanks to technological improvements and globalization.

Because of the pandemic, the industry expanded even further. At a compound annual growth rate of 9.4%, the worldwide outsourcing market might expand from about $262 billion in 2022 to $525 billion by 2030 .

Your business may be large and have strong commercial acumen and technical abilities, but you cannot manage a business on your own. You’ll need a hand from a talented team; that’s when outsourcing practice comes into play.

Here are some reasons why you should outsource certain functions or tasks in order to grow your business:

Access to specialized expertise : Businesses can use outsourcing to gain access to specialized knowledge and expertise that they may not have in-house, such as software development, digital marketing , or accounting.

Cost savings : Outsourcing can be a cost-effective choice for organizations because it reduces the requirement for new staff recruitment and training. It also helps companies to avoid the expenditures of providing benefits and office space.

Boost efficiency : Businesses can focus on their core capabilities and enhance overall efficiency by outsourcing non-essential company services. It also permits staff to concentrate on higher-level duties that are more strategic and vital to the company’s success.

Scalability : Outsourcing allows organizations to grow their teams up and down as needed without the long-term commitment of hiring full-time staff. This enables firms to respond swiftly to market developments or changes in demand for their products or services.

Enhance quality : Outsourcing can increase the quality of work by giving you access to specialized expertise and resources that your business might not have in-house. It also enables organizations to benefit from the outsourcing provider’s best practices and experience.

The time to outsource can be a challenging one for some businesses. The stage at which a company needs to outsource is different; some businesses must outsource at the initial stages, while others may prefer to outsource when they have established a firm foundation.

The situations in which your company needs to outsource might include some of the following:

Lack of in-house expertise : Outsourcing can provide access to specialized knowledge and skills if a company lacks the competence or resources to execute a specific activity or project.

The need to increase in workload : If a company’s workload or demand for its products or services suddenly increases, outsourcing can assist manage the burden and guarantee that deadlines are reached.

The economic condition of the company : Businesses may be more likely to outsource during moments of economic uncertainty in order to minimize costs and manage risks.

Outsourcing can be a cost-effective solution for firms suffering financial difficulties because it eliminates the need for hiring and training new staff as well as the costs involved with providing benefits and office space.

• Lack of specialized technology in-house : Outsourcing can provide access to specialized technology and software that may not be available in-house, allowing businesses to stay competitive and on top of industry trends.

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Outsourcing is determined by the company’s needs and goals. There are many platforms that businesses can outsource such as IT, product development, human resources, etc. However, here are a few things that businesses often outsource:

• Special skill set required at a specific point in time

Businesses that outsource a certain set of abilities for a specific project or activity can save money by avoiding the expense of hiring and training additional staff. In addition, businesses might benefit from outsourcing by gaining access to specialized skills and resources that may not be available in-house.

• Expertise knowledge

By giving firms access to the most recent industry trends, best practices, and technology, outsourcing specialized knowledge can help firms stay competitive in fast-paced industries or markets.

• Performing repetitive tasks

Businesses can enhance their overall efficiency and productivity by outsourcing monotonous tasks. Additionally, quality control procedures are often in place at outsourcing providers to guarantee that repeated tasks are executed accurately and to a high degree.

Outsourcing case study examples

Google is a multinational technology corporation best known for its search engine, ad platforms, and cloud computing services. While Google is well-known for its cutting-edge technology, the firm has also relied on outsourcing to support its operations and achieve its goals.

Google has effectively outsourced its business operations and a variety of activities. Within their company, they have been aggressively utilizing the technique of software development outsourcing.

In 2016, Google stated that it had teamed with Wipro, an India-based outsourcing company, to support its cloud computing services. Wipro would provide technical support, cloud infrastructure management, and other services for Google’s cloud platform as part of the cooperation.

Google’s collaboration with Wipro enabled it to leverage Wipro’s experience in cloud computing and gain access to a larger pool of skilled individuals to support its operations. Wipro also benefited from the partnership by having access to Google’s cutting-edge technology and expanding its client base.

Alibaba is a global Chinese technology corporation specializing in e-commerce, retail, and cloud computing. The company is well-known for its creative business model, which mainly relies on outsourcing to support its operations and meet its objectives.

When Jack Ma founded the company in 1999, businesses were progressively shifting to the Internet for customer support, and he made the right decision to outsource everything.

Alibaba’s relationship with Cainiao Network, a logistics company specializing in package delivery and warehouse management, is one example of its outsourcing strategy. Alibaba stated in 2013 that it had purchased a controlling stake in Cainiao Network. The goal is to improve its logistical capabilities and the customer experience on its e-commerce platform.

Thanks to this partnership, Alibaba has been able to tap into specific skills in logistics and have access to a wider pool of trained individuals to support its business.

The collaboration has also aided Alibaba in expanding its logistics network and improving delivery times, which have been critical to the company’s success in China’s highly competitive e-commerce sector.

With over 2 billion active users globally, WhatsApp has become ubiquitous in modern communication. With a limited cash reserve, creators Jan Koum and Brian Acton concluded that outsourcing was the best product creation method.

WhatsApp’s success can be attributed to the use of Russian offshore developers. Outsourcing allowed the company to concentrate on core operations and reduce operating costs while developing a successful product.

When a company grew in reputation among its peers by personally assisting potential consumers, it garnered brand-loyal customers. This is also the case for WhatsApp. The company outsourced the app’s development to another company in order to make it cross-platform and gain more iOS users.

Later in 2014, Facebook paid $19 billion for the company. Despite the fact that it relocated its third-party contractors to the United States, offshore outsourcing was critical to the company’s growth and profitability.

Slack has its own exciting story among the success stories of businesses that have benefited from outsourcing. Slack is a cloud-based team collaboration software enabling real-time communication and collaboration.

Outsourcing has played a significant role in Slack’s phenomenal growth. The creator of Slack, Stewart Butterfield, wants to grow the business. But due to his lack of design skills to build the app, brand, and marketing website, he opted for outsourcing to achieve his goal.

MetaLab, a Canadian design team, was hired by the company to assist in developing a product from the beta version. Thanks to MetaLab’s feedback, the Slack team created a useful tool that acquired 15,000 users within 2 weeks of its launch.

The company raised a total of $5 billion in July 2017 and is still growing. According to Statista, Slack had over 10 million daily users in 2020 and was expected to reach around 80 million by 2025. Slack is a prime example of a top IT outsourcing success story that many businesses should learn from.

Skype is a telecommunications tool specializing in video and phone chats between devices via the Internet. While the business has acquired a good reputation in online communication, it relies on outsourcing to support its operations and achieve its goals.

One example of Skype’s outsourcing approach is its partnership with Luxoft, a worldwide IT services provider. This collaboration enabled Skype to leverage Luxoft’s software development skills and get access to a broader talent pool of trained experts to assist its operations.

This outsourcing effort also helped Skype reduce its development costs and improve the quality of its software. Skype has been able to scale its operations rapidly and efficiently by working with a specialized partner and outsourcing key functions.

To begin with, Github is a web-based version control and collaboration platform popular among software engineers and developers worldwide.

The company outsourced its backend activities, which were critical for GitHub sharing. The outsourced contractor was Scott Chacon, a Get specialist. Chacon was able to help the business with the development of the Gist backend.

This was an example of GitHub’s outsourcing approach to growing the company and achieving its goals. Over time, GitHub has become a prominent platform for open-source projects and collaboration, and its outsourcing model has contributed significantly to its success.

WaitWhile is a cloud-based tool for managing client lines and appointments. WaitWhile began with a base app that was well-liked by its early users, and scaling became inevitable. However, due to the limited technology, the company had to outsource the work to NeoITO, a global software development company.

WaitWhile has partnered with NeoITO to develop and maintain its platform. They also added new features and enhancements to the user experience. By outsourcing its software development needs, WaitWhile was able to accelerate the development of new features and functionality for its platform while also reducing its development costs.

In a nutshell, outsourcing has become a popular business technique that can give numerous advantages to businesses of all sizes and industries. The outsourcing case studies presented in this blog show how outsourcing may assist organizations in scaling their operations, gaining access to specialized skills, and improving the customer experience.

The success of these outsourcing case studies emphasizes the significance of choosing the proper outsourced partner. By learning from these real-life outsourcing case study examples, businesses can make informed decisions about their outsourcing strategy. They can also take into account the pitfalls of outsourcing that need to be avoided.

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6 Case Studies Proving You Should Outsource IT Development

For many years IT outsourcing has been a popular option among technology companies. Nearly 57% of global companies hire offshore developers seeking to focus on their core business activities. 

Besides multiple successful cases of outsourcing by big companies, many startups still beware of outsourcing web development overseas for trust and delivery concerns. However, the practice of big players shows the reality of outsourcing is wholly different. 

In this article, I want to use some successful cases of outsourcing among big companies to disrupt some misconceptions and deduce some lessons that cofounders can follow. So let us start!  ‍

Slack: Outsourcing is a Choice of Early-Stage Startups

Slack is  a real-time office collaboration tool featuring chat rooms (channels) by topic, private groups, and direct messaging. Needless to say, that now this is one of the most popular tools for business communication with nearly 12 million daily users (as per 2020), and this number is expected to reach 79 million by 2025.  

At the same time, Slack stands out as an example of the most successful outsource cases. In fact, in a bid to save raised funds, the company outsourced design and app development services from the very beginning. Relying on outsourced workforce, Slack managed to get 15,000 users during 2 weeks after launch and to become a startup unicorn in 2014. 

Slack outsourcing case: Lesson learnt

Slack’s case is a vivid example of how a startup outsources its development to win ample investments and thrive with thousands of users. 

WhatsApp: Find the Expertise You Lack

Whatsapp is an app that hardly needs a presentation. Hands down, this is probably the most popular messaging app, with over 2 billion users around the globe. However, the wind has not always blown to WhatsApp founders’ backs. 

Back in 2012, at the outset of WhatsApp’s story, it was a small organization with only 30 full-time employees and five part-timers. The company started only with $250,000 capital raised at the seed round. 

Frankly saying, this is little to kickstart a product. But WhatsApp needed to keep its costs down and find the web development talents with the quality/price balance.  This is why the company turned to East Europe, the biggest outsourcing hub, to find tech talents for developments. 

WhatsApp outsourcing case: Lesson learnt

Outsourcing does not only help to reduce costs, but also opens access to an enormous talent pool. Isn’t this what matters when starting a product? 

CitiGroup: Outsourcing Helps to Save Up

Among the famous outsourcing examples, Citigroup, a US-based  multinational investment corporation probably sits atop as the oldest company to hire overseas. Citi has been hiring people offshore since 1992, outsourcing workforce from India, the Philippines, and Poland. The company’s efforts in this direction went even further. In 2014 Citi slashed  11,000 jobs at its HQ, at least a quarter of which were IT specialists, to bring them offshore. This move saved the company $1.1bn a year. 

Outsourcing tech development is a widespread example among banking giants. For example, such banking entities as Bank of America, Barclays, Goldman Sachs, and J.P. Morgan also hire developers overseas.  

CityGroup outsourcing case: Lesson learnt

Outsourcing can be a viable option not only for startups, but also big corporations and banks. 

Basecamp: Outsource Web Development and Focus on Business

Basecamp, a company offering project management solutions, is another example of a successful outsourcing case. At some point in growth, the company faced the “cobbler’s children” problem. While others were using their tool to manage projects and work, they had internal issues managing workflow and client support. As a result, Basecamp decided to outsource some essential development functions to resolve this situation so that their internal teams could focus on business. 

Basecamp outsourcing case: Lesson learnt:

The tip for picking up from Basecamp is identifying your weak spots in the company and outsourcing development work to remote programmers to drive internal improvements for the organization. 

Google: Outsource to Cut Labor Expenses

It turns out even the 89,000+ in-house Google army cannot handle the massive workloads. This is why Google outsources global talents and partners with contractors for its AdWords project, which completes the company’s lion’s share in revenue (2017). According to Bloomberg, 2018 was the first year when the number of Google’s contractors surpassed direct employees .

Google purports the first reason to outsource is the access to the global pool of talents and expertise that lacks within Google's walls. 

Secondly, by outsourcing, the company skips employment and operation costs. 

Google outsourcing case: Lesson learnt

When it comes to outsourcing – take it rationally. If you cannot find the right talents in your current personal – no need to seek them in the labor market. It takes a little time to find the expert you need with no additional expenses required. 

Alibaba: Outsource the Talents You Need

Alibaba, the Asian e-commerce giant, is another example of successful outsourcing. As of now, the company wields 779 million active customers and has 149,2 billion in revenue. In fact, the company has outsourced its website design and development work. 

Back in the 90s Jack Ma, Alibaba’s founder faced a scarcity of resources. There were Chinese specialists with expertise in e-commerce development. Another complication was that China had formidable internet restrictions, which was a hindrance for website development. 

So the company started to seek partners and outsourced overseas across a range of different projects, and they found the human resources they needed in the US. By hiring specialists overseas, the website started growing at an astronomical pace. For instance, in 2014 Alibaba hit the record by becoming the largest IPO in history and raising $25B. 

Alibaba outsourcing case: Lesson learnt

You should clearly see your weaknesses. By knowing the talent gaps in the region, Alibaba managed to outsource resources elsewhere and grow into a flourishing business. 

Recap: Why Companies Outsource?

As it stems from the IT outsourcing examples, hiring developers remotely helps tackle many business problems. Let’s summarise some of them. Here are the key objectives that companies pursue when outsourcing developers from abroad: 

Cost reduction

‍ working with remote contractors allows to save up on operating costs. The economic interests play a more critical role, especially in the midst of COVID-19 outbreak, when the economic environment is unstable;

Focusing on business

Ooutsourcing web/app development functions, companies manage to double down on the product development, scaling-up and enhancing the speed to market; 

Saving funds at the beginning

‍ Young startups tend to outsource web/app development at the beginning of their journey to save funds and invest them into the product;

Gain new expertise

If you want to test a new AI-based technology for your product or some AR feature for an app, employing a person might be too overwhelming. Outsourcing a subject specialist with the needed skills might be a less effort-consuming solution; 

Avoid extra labor costs

Again, you do not have to go through all the employment fuss and provide all the social benefits, when you can outsource product development to a contractor and save your budget.  

Conclusion 

The IT outsourcing cases I described show that outsourcing is a viable solution that can save your business, regardless of its size, business model or age. If you want to know more, contact our team , so you could figure out what is the optimal solution for your business.

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7 IT outsourcing case studies every startup can learn from

Grid Dynamics Market Analyst

October 19, 2023 • 8 min read

Outsourcing – a key to harnessing expertise across business functions

Outsourcing examples of companies built by remote teams, grow your business with grid dynamics.

In today’s competitive labor market, finding and retaining top talent is a crucial challenge for companies looking to meet their strategic goals. To build their future workforce, more and more IT firms are thinking beyond traditional hiring approaches and exploring expanded talent sourcing ecosystems that incorporate external service providers.

Inspired by the numerous successful outsourcing examples of startups and industry leaders, businesses are recognizing the benefits of remote teams. For one thing, hiring offshore developers allows them to access a global talent pool beyond their immediate locale and enhance long-term workforce planning. Outsourcing also solves a number of issues from cutting software development costs to finding niche technical skills.

In this blog, we will take a deeper look at seven compelling case studies of innovative startups that have embraced offshore teams. The examples provide insightful models for companies looking to unlock greater potential through  effective outsourcing .

Considering the global tech talent shortage, outsourcing is becoming a desirable option for businesses looking to gain access to new capabilities and specialized skills. As many companies are facing the challenge of technology changes outpacing feasible adoption timelines, they are leveraging external partners to quickly bridge skill gaps and stay competitive and responsive in a climate of fast-paced innovation.

Deloitte Global Outsourcing Survey  shows that 76% of companies rely on third-party providers for delivering their IT services. The study highlights that while outsourcing was once seen primarily as a means to eliminate routine tasks, allowing internal technology teams to focus on core competencies and innovation, the attitude towards this business practice has changed considerably over the past two decades. It is now valued for providing access to specialized capabilities across a wide range of IT functions.

This move proved to be a wise one. Within just six months, Pricena’s new Android app amassed over 50K downloads and a 4.3-star rating on Google Play. Given the tremendous success of the mobile apps in a short period, it was no surprise when Pricena won the Online Startup of the Year award for 2015.

Riding this momentum, Pricena decided to further improve the customer experience by updating the web version of their platform. They  hired a full-stack engineer  to lead the web development efforts. The goal was to provide seamless integration between the mobile apps and the web platform.

The series of technology investments allowed Pricena to make major strides forward. Today, the company provides a unified user experience across all major platforms and devices. Omnichannel availability, well-designed features, and pricing comparison capabilities have become a key competitive advantage for the company, allowing it to take the lead in the MENA market.

Get outsourcing rates in Eastern Europe, Asia, Latin America, Africa as well as tips on how to choose the country for offshore development.

CuriosityStream

In 2019, Curiositystream hired a team of six programmers, who helped them develop the video feature for the web version of the platform and background playback capability for mobile applications. Introducing new functionality led to a significant increase in the number of hours watched. 

Andre Silva, CTO at Curiositystream, commented on the  company’s outsourcing strategy : “Outsourcing is of great value for a business, as hiring remotely makes it easier to scale. The main advice – try to figure out a way to integrate the offshore team with the on-site one. It can be challenging, but the return on investment is definitely worth it.”

Seeking to access dedicated, highly-skilled tech professionals, Studytube opted to  build an outsourced development team  in Ukraine. This move aligned with the company’s priorities for expanding platform capabilities and accelerating innovation. Since switching to  nearshore engineering , the startup has been able to build momentum and scale more efficiently. This strategic decision has already enabled Studytube to secure three rounds of investment totaling €1.5 million.

Software development market statistics of the tech countries — Poland, Ukraine, Romania, Czech Republic, Hungary, Bulgaria, Belarus, and Croatia.

By collaborating with MetaLab, the Slack team received valuable feedback that helped to evolve the minimal viable product into a user-friendly tool ready for widespread adoption. Within two weeks following its launch, the platform gained a remarkable 15K users.

Today, the service boasts an impressive 20 million active users. It has been integrated into the daily business activities of high-profile organizations including IBM, BBC, and Oracle.

WidgetBrain

Check out Widgetbrain’s outsourcing success story:

Rogier Roukens, the CTO of Vive, stated that he was impressed not only by Ukrainian developers’ level of education, experience, and English but also by their investment in the project’s success. “We have the same goals, which creates a special team feeling and I think our Ukrainian developers are a really important part of that.”

Given the proven benefits of outsourcing like cost savings, access to specialized skills, and flexibility to scale resources up or down, and the shifting mindset toward embracing blended workforces, its adoption levels will continue to rise. As companies navigate the ever-evolving landscape of global innovation, this cooperation model provides the adaptability and capacity that is essential for driving business growth over the long term. 

If you consider leveraging the benefits of IT outsourcing, Grid Dynamics is here to help. We can help you build a remote team perfectly suited to your unique business needs and technology requirements. With our expertise in offshore product development, we can assemble an engineering team with the precise skills and experience necessary to successfully deliver your project. 

Our process is pretty straightforward:

• Provide us with your software development needs and desired team size. Whether you need one developer or a full team, we are here to assist.
• Interview the candidates from a pre-screened pool of engineers that best suits your project specifications.
• Once assembled, your team works under your command. We help you establish effective cooperation and implement robust retention initiatives to minimize turnover and maintain the satisfaction of your remote employees.
• Stay focused on driving your development process forward while we handle administrative tasks like taxes, payroll, office management, HR, and more.

If you are ready to explore the opportunities offered by our model, get in touch with us!

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Topics: Offshore Recruiting, Offshore Recruitment Services, Offshore RPO, Offshore RPO Services

5 Successful Outsourcing Case Studies You Must read

Posted on September 25, 2023 Written By Sakshi Sharma

Did you know that according to a report , 63% of marketers consider case studies to be an effective content marketing tool? The present-day constantly changing business environment demands successful outsourcing to achieve growth. QX Global Group, a leading outsourcing firm, has a proven record of transforming businesses across various domains. 

In this collection of case studies, we explore successful outsourcing examples a nd how their expertise and technology drive remarkable results in diverse industries. 

Case Study 1: Engineering Staffing Agency Secures 654 Placements in 10 Months with Outsourced Recruitment Support

Client’s challenges.

• Delay in covering all the open roles  
• Limited bandwidth for the onshore team to cover all the open roles  
• Limited pool of candidates for locations with high open roles  
• The onshore recruitment team was unable to meet critical hiring deadlines

Solutions Provided

• Identified and set up a team of 15 offering Offshore Recruitment Services to deliver this project
• Trained the team to bring them up to speed with the client’s process, systems, and roles in under 30 days
• Weekly progress review call with the hiring manager to discuss
• locations with urgent hiring needs,
• focus for the coming week,
• upcoming roles for the team to pipeline candidates, etc.
• New jobs covered within 24-36 hours
• Built pipelines for repetitive roles to ensure the swift flow of candidates
• Open roles advertised on job portals and social sites to attract more candidates
• Streamlined the candidate application process into the client ATS
• Identified best practices from success cases, applying them to other openings as part of the continuous optimization process
• Kept track of the interview offers and started to keep a check on the success cases and gauge our submittal and turnaround time process

Case Study 2: GBS Model Implementation for Global Recruitment Agency

Business challenges.

• Transitioning from a long-withstanding region/entity-based structure
• Build a plug-and-play model to integrate services for newly acquired brands easily.
• Ensure continuous improvement of current processes to increase team efficiency, implement smart automation and
• build a scalable business model.

QX Solution

In order to bring about organisational transformation for the client, QX followed

a unique Transition-Improve-Transformation model:

• Transition: For the first six months of our partnership with the client, the QX team worked on process mapping, identified client requirements, did an in-depth risk analysis and did a comprehensive process baselining.
• Stabilise & Improve: In the 6 to 18-month period, the QX team focused on introducing ISO, monitoring processes, collecting feedback and ensuring continuous improvement.
• Transformation: 18 months into the partnership, QX moved into the transformation phase – bringing about smart automation, benchmarking and continuous process improvement.

Tools and technology implemented:

• Bank Download Tool – This tool has helped the process of downloading daily cash receipts from over 20 bank accounts
• PO Update Tool – This tool has helped clients eliminate manual efforts of updating the PO number on invoices.
• VMS Timesheet Tool – This tool has helped our client to automate the “Timesheet Download and Upload” process

Case Study 3: Optimising O2C Process for a Leading Recruitment Firm through Bank Download Automation

The client, which has a network of more than 40 brands that it has expanded via mergers and acquisitions, is one of the largest recruiting experts in the world. The client, one of the fastest-growing organizations in this market, concentrates on combining recruiting businesses servicing various sectors.

• The crew put in a good deal of time and effort each month to download more than 4,000 payments.
• Manually carrying out this procedure for several manufacturers increased the possibility of mistakes, such as missing downloads and duplicate downloads.
• The staff had to pay close attention to make sure that each payment was downloaded, handled carefully, and posted in accordance with the client portal’s specifications.
• The staff would struggle to separate IDF and current payments because to the huge payment volume, significantly increasing the chance of human mistakes.

How QX Helped

As a part of our solution, we performed the following activities:

• Created and built a bank download program that downloads and keeps all incoming payments from bank portals in a certain folder automatically.
• Initially, 20 organizations used the technology to automate bank downloads; as time went on, more companies did the same.
• Automation increased team productivity and download accuracy, which eliminated the potential for manual mistakes.
• To greatly reduce suspense balance, establish a smooth communication route between cross-functional teams.
• A highly adaptable system that can be simply adjusted to any changes in the bank site has been implemented.

Case Study 4: Streamlined Loan Approvals for Global Recruitment Giant Through IDF Automation Services

For the client, QX has worked on a number of projects, including end-to-end F&A transformation for crucial processes, including pay & bill, accounts payable, and accounts receivable, delivered using a Global Business Services model.

• When inputting bills manually, the QX team would invest a lot of time and energy.
• Manually separating invoices for the many customer brands raised the possibility of mistakes. This was a cause for worry because any uploading fault may result in the customer suffering a financial loss.
• The compliance staff had to exercise extra caution and frequently struggled to adhere to regulations. Fund flow leakages might be caused by any disagreement.
• The team had to pay additional attention to make sure that the requirements of the financial institutions were satisfied and that the data was posted properly in the required formats on their portal.
• IDF Automation technology was created and used to automatically separate intercompany and non-intercompany invoices on an account level.
• After that, non-intercompany accounts undergo the second stage of invoice level segregation based on criteria such as GBP & foreign currency invoices, credit notes, self-bills, and perm invoices. The system then creates the whole file, which the team may check and publish to the bank site.
• Successfully deployed the solution across 11 businesses to allow IDF process management.
• Configure the system to produce a consolidated report that aids the team in completing month-end reporting and reconciliation tasks promptly.
• The client’s quarterly audits may now be carried out more successfully thanks to the implementation of several persona dashboards with audit trails.

Case Study 5: Automating Data Parsing for Recruitment Agencies with Email Parser

Six of the top ten healthcare staffing agencies are among the top recruiting firms QX works with in the UK. These organizations frequently deal with a lot of emails with the same or similar material. Manually processing this data may result in a loss of time, money, and labor.

• The customer had to keep a team of 15 employees on hand to transfer job openings from their inbox to their front-end system due to the client receiving thousands of job posting emails from various Trusts.
• The organization’s competitiveness and turnaround time were influenced by the time it took to create the vacancy in the front-end system and deliver it to the recruiting consultants.
• Sometimes, two data entry personnel would select up the same opening, leading to duplicate opening entries in the front-end system.
• Closing openings that were filled requires tedious and time-consuming manual updating.
• Human mistake risk rose considerably when data was entered manually.
• Arranged for more than 30 Trusts to deliver vacancy alerts in organised formats (during the first two to three months) by configuring their email addresses and vacancy information structures.
• Create a system such that configuring any new Trust email address or accommodating any modification to incoming email or vacancy structure only takes 15 to 30 minutes.
• Set up a quick notification mechanism for the appropriate team members for any system exceptions.

In conclusion, these successful examples of outsourcing by QX Global Group serve as compelling examples of how strategic outsourcing can drive operational efficiency, cost savings, and business growth. These case studies showcase the tangible benefits that businesses can achieve by partnering with QX Global Group, from streamlining financial processes to expanding their global reach. 

Q. How successful is outsourcing?

Ans: The success of outsourcing varies depending on various factors but can be highly successful when executed strategically.

Q. What is successful outsourcing?

Ans: Successful outsourcing involves achieving cost savings, improved efficiency, and maintaining quality while delegating tasks to external providers.

Q. Why is outsourcing successful?

Ans: Outsourcing can be successful due to reduced operational costs, access to specialised expertise, scalability, and the ability to focus on core business functions.

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Originally published Sep 25, 2023 04:09:30, updated Jul 29 2024

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10 Inspiring Stories Showcasing the Impact of Custom IT Solutions on Enterprises

Businesses have saved millions with IT outsourcing while achieving impressive results. Let’s explore the examples of successful IT outstaffing & custom solutions development of world-known brands.

IT outsourcing is the practice of delegating IT functions and services to external service providers, allowing companies to focus on their core competencies. Being expected to reach a staggering $781 billion by 2030, the global IT outsourcing market continues to thrive due to numerous technology trends that have flooded the software development sector, coupled with a concerning scarcity of experienced developers in certain regions.

Dive into 10 compelling case studies that showcase the immense benefits and successful outcomes achieved through IT outsourcing. These real-world examples span diverse industries and highlight the strategies, best practices, and lessons learned.

Read more on the topic :

• 5 Key Trends for Outsourcing and the Shared Services Market in 2023
• Custom vs. Off-the-Shelf Software: Which Is the Right Solution for Your Enterprise?
• Best Regions to Source a Software Development Team
• How to Safely Migrate Your Software Projects to a Different Development Team

Why Enterprises Choose IT Outsourcing

Here are some benefits that motivate enterprises to opt for IT outsourcing:

• Cost savings . Outsourcing eliminates expenses related to hiring, training, infrastructure setup, and ongoing operational costs.
• Access to specialized expertise . Custom software development providers often possess deep domain knowledge, technical skills, and experience in specific areas of IT. Enterprises can access cutting-edge technologies , best practices, and industry insights that may be otherwise challenging to acquire in-house.
• Scalability and flexibility . This approach eliminates the challenges of managing a fluctuating workforce and infrastructure internally, so companies can respond swiftly to changing business dynamics.
• Prioritize business activities. Outsourcing routine tasks, such as data processing, IT maintenance and support, allows organizations to redirect their efforts toward innovation, market expansion, and value creation. In other words, they can work on their competitive advantage and business growth.

Read more : How to Attract New Customers and Scale Your Business with Custom Software

• Accelerated time-to-market . Providers have a wealth of knowledge and efficient methods in their tool kit, allowing them to complete projects more quickly and efficiently.
• Risk mitigation . Reliable software development partners usually have strong security measures, plans for handling disasters, and systems in place to ensure compliance with regulations. This takes away the need for companies to build these capabilities from scratch.
• Global reach and market expansion . By engaging with specialists located in different regions , organizations can leverage diverse perspectives, cultural insights, and even local market knowledge.

Read also : Offshore Development Center vs. Internal Team: Which to Choose?

All in all, there are numerous advantages to outsourcing development, even if your company has the resources to afford an in-house team of developers.

10 Examples of IT Outsourcing: Outstanding Software Built by Remote Teams

Without further delay, these companies have embraced the distributed development model, which helped them unlock new levels of productivity, creativity, and collaboration:

Now one of the leading platforms for software development and version control, GitHub made a strategic decision to outsource the development of its MVP . The CEO and co-founder of GitHub recognized the importance of finding a backend developer with extensive knowledge and expertise in Gits, a crucial aspect of their platform. They came across Scott Chacon, who possessed a rare understanding of Gits at that time. In response to the founders’ request, Chacon joined the GitHub team as a consultant on an outsourced basis.

Chacon’s involvement proved to be pivotal as he took on the responsibility of developing the backend of GitHub’s website. His understanding of Gits and his technical skills allowed him to build the robust foundation that became integral to the platform’s functionality.

Related material : 6 Secret Reasons Why Organizations Outsource Software Development

To conserve raised funds, Slack chose to outsource design and app development services right from the beginning. They hired a Canadian design team to assist in the development of their product, starting from the beta version, and this external team played a crucial role in refining and enhancing the user experience of Slack’s website and mobile app. They also took charge of redesigning the company’s logo and creating the visual elements that users interact with while using the messaging service.

Within just two weeks after its launch, Slack managed to acquire an impressive user base of 15,000 users. This early success propelled the company’s growth trajectory, leading to its eventual status as a startup unicorn in 2014 and attracting considerable investor attention.

Initially, Opera received financial support from its parent company, Telenor. However, when Opera transitioned into a separate entity, its available resources became more constrained. In order to efficiently manage its development process while considering the skills and capacity of developers, Opera went for remote software development services .

This outsourcing case study example can teach companies how to optimize limited resources. Opera could tap into a global talent pool, selecting developers with the required expertise and experience to contribute to its platform. And they only committed to in-house operations after determining the critical areas that required internal expertise.

In its early days, back in 2012, WhatsApp was a small organization with limited resources, comprising just 30 full-time employees and five part-timers. With only $250,000 raised in seed funding, the company couldn’t keep the costs reasonable while competing against established players in the market, particularly SMS technology.

To tackle this obstacle, WhatsApp opted to outsource the majority of its essential development work to an external partner. They understood the importance of finding web development experts who offered a combination of high quality and cost-effectiveness.

Therefore, they turned to Eastern Europe, a renowned outsourcing hub known for its talented IT professionals, to meet their requirements. Just two years after its outsourcing decision, the company achieved an important milestone when it was acquired by Facebook for a staggering $19 billion.

Skype, founded in 2003 by two entrepreneurs from Sweden and Denmark, outsourced its development work to three professional developers from Estonia. Working together, the founders and the Estonian developers successfully created the widely recognized and beloved communication platform known today.

One of the Estonian developers played a crucial role in introducing the concept of cost-effective voice calls through a P2P protocol. Additionally, Skype’s innovative features, such as video chat, instant messaging, and file transmission, have made it an indispensable tool for individuals and businesses alike.

The success of Skype was evident just two years after its inception when it was acquired by eBay for $2.5 billion in 2005. This marked a significant milestone for the company. Subsequently, in 2011, Microsoft acquired Skype for an even more substantial amount, reaching $8.5 billion.

Email Marketing Tool

An email marketing tool often requires extensive database-related expertise, which implies specific hands-on experience vital for project success. That’s what a global market leader in the segment faced. Besides the team’s skill set, they looked for a cost-effective solution to develop an email marketing tool. Outsourcing the task to Intetics allowed them to achieve both goals: source expertise and reduce the costs.

Besides technical support, the development team also served as a professional services provider, offering custom implementations, resulting in a stable and efficient platform capable of handling the delivery of 5 million emails per month.

During the 1990s, Jack Ma, the founder of Alibaba , faced major challenges due to limited resources and the complexities of operating in China’s restricted internet environment. The scarcity of Chinese specialists in e-commerce development added another layer of complication. With a modest initial investment of $20,000, Jack Ma recognized the need to look abroad for the website development of his startup.

Alibaba began seeking partners and outsourced various projects to overseas professionals, particularly in the United States. This move paid off in remarkable ways. Alibaba’s growth trajectory soared to unprecedented heights, culminating in a historic achievement in 2014 — the company secured its place in the annals of business history by executing the largest IPO ever witnessed.

Google is known for its vast in-house workforce of over 178,000 employees , but it still finds itself facing monumental workloads that require additional support. Therefore, the company leverages the power of outsourcing by tapping into the global talent pool and partnering with contractors. One prominent example is Google’s AdWords project, a cornerstone of the company’s revenue generation in 2017. To ensure the seamless functioning of this robust service, Google has enlisted the expertise of more than 1,000 outsourced representatives hailing from over 60 countries.

In fact, the reliance on outsourcing has grown to such an extent that, as reported by Bloomberg, the number of Google’s contractors exceeded its direct employees for the first time in 2018. The significance becomes even more evident when we consider the magnitude of AdWords, a tool that captures the attention of marketers worldwide by reaching over 90% of internet users.

In the realm of financial technology, Wise stands out as a company that embraces the power of independent workers within its core team. To build their remote team, Wise has established a presence in Estonia and Ukraine, where they seek out technicians known for their quick technical reflexes and impressive skill sets.

When it comes to hiring product engineers, Wise goes above and beyond to find exceptional individuals. They have developed a rigorous evaluation process that consists of multiple stages. Prospective engineers are required to complete a take-home test, followed by technical interviews with experienced engineers. Additional technical interviews and a product interview with a manager and engineer may also be conducted. Lastly, candidates can showcase their abilities in a final interview with the Vice President of Engineering or a co-founder. These thorough interview and evaluation phases serve to identify top-notch talent.

Leading USA Health Portal

One of the key obstacles faced by the health portal was finding the right experienced software vendor to bring their vision to life. Previous attempts to develop the system had failed due to skill shortages and limitations of previous vendors. Therefore, the Health Portal sourced expertise by hiring the Intetics Remote In-Sourcing® Team , which took on the responsibility of designing and implementing 100% of the Client’s products, ensuring that the system was built to their exact specifications and requirements.

The newly developed system now serves a user base of 5,000,000 people on an annual basis, with this number continuing to grow. By entrusting the technical aspects to the Remote In-Sourcing® Team, the Client was able to shift their focus and concentrate on their core medical business.

Got Inspired? Let’s Make an Impact Together!

These ten successful outsourcing case studies have employed different forms of IT outsourcing, yet they all arrived at the same resounding conclusion: opting for custom software development in partnership with a reliable engineering partner or hiring remote talented engineers , can enhance business’s efficiency and optimize costs.

Whether you find yourself in the early stages of a startup or operating as a well-established multinational enterprise, embracing this approach may yield tremendous benefits. If these success stories have inspired you to consider tech partnership, Intetics is eager to deploy its expertise to make an impact in your industry together. Reach out today !

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Outsourcing Case Studies Businesses Can Learn From

The rise in outsourcing and remote working opportunities is possibly one of the only bright spots among the dismal clouds cast by the COVID-19 pandemic. Many people were uninformed in the early phases of the pandemic, and many outsourcing organizations saw a drop in production.

Now, however, according to Gartner, around 74% of CFOs want to shift at least 5% of previously on-site personnel into permanently remote employment once the epidemic is over. 

However, as people became acclimated to the situation and accepted new technical solutions, outsourcing capabilities and economic opportunities, they found new avenues to explore.

A global IT outsourcing market analysis predicts that the industry would increase by 98 billion USD by 2024, with a compound annual growth rate (CAGR) of 5%.

Though outsourcing is a highly profitable and effective approach to develop your business, there are a few things to consider before implementing it. Learning from the experiences of companies that have done this successfully can be a simple approach to get started.

To this end, we’ve gathered 10 outsourcing case studies to help you get a better grasp of outsourcing.

1. CuriosityStream

Curiosity Stream is a global independent media firm and video-on-demand streaming service that experimented with outsourcing in 2019.

They employed six programmers to assist them in developing the video component that increased the number of hours watched. This aided them in increasing overall productivity while also lowering the cost of developing the software.

The CuriosityStream team drew inspiration from the many achievements of other companies and learned how to build a successful outsourcing program.

According to interviews with Andre Silva, CTO of CuriosityStream, his advice to other entrepreneurs is to work out how to combine the offshore crew with the on-site staff.

2. StudyTube Hires

StudyTube is a Dutch-based online education portal that relies on nearshore programmers. In the beginning, they worked with part-time engineers but quickly realized it wasn’t going to work.

As a result, they employed Ukrainian developers, and this nearshore outsourcing solidified their chances of expanding their firm. With a secured investment of €1,500,000, they are continuing growing at a rapid pace.

We’ve all heard of Skype, a telecommunications tool that specializes in video and phone chats between devices via the internet.

The majority of the software was developed by European web developers. Skype asserted that competent web development was required for its product concept, so it chose outsourcing as a solution.

The 300 million monthly active users and nearly 1 billion downloads attest to their success through outsourcing.

Slack has its own growth story among the success tales of organizations that have benefited from outsourcing. MetaLab, a Canadian design firm, was engaged by the company to assist in producing a viable product from the beta version.

In July 2017, the company raised a total worth of $5 billion, and it is still increasing. By outsourcing website design and mobile app development, the corporation increased its investment.

Slack’s rise from rags to riches is a prime example of outsourcing success. MetaLab offered crucial feedback to the Slack team, allowing them to design a solution that reached 15,000 users within two weeks of its launch.

GitHub hosts Git for version control in software development. This Microsoft subsidiary provides Git’s version control and source code management (SCM) functions as well as its own features.

One of the companies that outsourced its MVP is GitHub. They recruited a backend developer to build the product’s backend.

6. Whatsapp

Whatsapp has over 1.5 billion active users in over 180 countries, and the corporation is no stranger to outsourcing. With a limited cash reserve, creators Jan Koum and Brian Acton concluded that outsourcing was the best method to create the product.

As a result, they employed Russian software developers to reduce operational costs while obtaining highly experienced workers. 

Whatsapp is the third most downloaded Android app on the Google Play Store, with over 2 billion active users.

7. Waitwhile

Waitwhile, created by two ex-Google employees, solves a prevalent problem for people who are waiting in line for a phone call. We all despise getting held at “receiver point” for hours on end with an annoying tone that rings intermittently. Waitwhile is fixing that problem with the assistance of artificial intelligence; it will wait for you while you do whatever else you need to do.

Waitwhile began with a base program that was warmly appreciated by its early users, and scaling became inevitable. However, they were limited by their technology, so they outsourced the work to NeoITO.

They improved their previous framework, which was built with AngularJS, and added the functionality required to handle high scaling. Waitwhile has established its market position with over 2 million hits.

8. Widget Brain

Widget Brain is a startup company established in the Netherlands that is a pioneer in AI-driven labor management. It is one of the Netherlands’ hottest startups.

Outsourcing altered the game for them when they employed five Ukrainian developers; the high-quality labor they acquired at a reasonable cost aided their company’s growth.

Widget Brain has received a $2 million investment to develop globally thanks to software outsourcing.

9. Oktopost

Oktopost is a social media management platform that was launched in 2013. They operated in Israel, Ukraine and the US, with 22 employees.

Oktopost hired software developers through Daxx in 2018, which helped them extend their roadmap and scale their business. The offshore development team has undoubtedly assisted them in developing services that they struggled with in the early stages. Outsourced work assisted them in improving their company roadmap and attracting additional investors and consumers.

10. Alibaba

Alibaba is unquestionably one of the most successful outsourcing cases. Alibaba Group co-founder Jack Ma is a staunch supporter of an open and market-driven economy.

Initially, Jack Ma outsourced his software development job to the United States. This was done to appeal to a bilingual audience and to employ experienced computer specialists that he couldn’t locate locally.

This was not in vain, as Alibaba today controls 60% of the Chinese e-commerce market.

There is a rather prevalent misunderstanding that outsourcing results in weak management techniques and subpar customer service. To gain the benefits of outsourcing, you must first hire the right people who can match your needs.

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Home · bpo learning center · Outsourcing Case Studies: Lessons Learned From Successful and Failed Outsourcing

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• January 21, 2024

Outsourcing Case Studies: Lessons Learned From Successful and Failed Outsourcing

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Table of Contents

Running a business is taking a risk. Sometimes entrepreneurs win; other times, they fail. Either way, the outsourcing case studies outlined below share some knowledge to guide you through your business decisions.

Business process outsourcing (BPO) is a double-edged sword. It can help you save time and money while improving your overall efficiency and business productivity. However, it might also lead to disastrous outcomes if not managed properly. So outsourcing is a calculated risk.

Explore the outsourcing projects below to learn more about successfully implementing the strategy.

Lessons Learned From Successful Outsourcing

First off, what is BPO ? It entails delegating non-core tasks to third-party service providers instead of handling them in-house. Companies of all sizes outsource both front-office and back-end operations.

Outsourcing has long been a popular strategy for scaling operations and reducing costs. The industry grew further due to the pandemic. The global BPO market size could grow from nearly $262 billion in 2022 to $525 billion by 2030 at a 9.4% compound annual growth rate (CAGR).

These facts and figures speak volumes about the industry’s market growth. Check out the BPO case studies below to learn how to make the most of outsourcing.

1. Slack: Accessing Experts To Grow a Business

Businesses, regardless of their size, have embraced Slack as a digital epicenter for fostering employee collaboration. What began as a humble messaging startup has rapidly evolved into an indispensable tool for facilitating seamless business communication.

The remarkable ascent of Slack owes a substantial debt to the strategic use of outsourcing. Early on, they enlisted the services of MetaLab, a distinguished Canadian design team, to craft the beta version of their business concept. MetaLab’s invaluable feedback paved the way for a user-friendly tool that swiftly gained widespread adoption.

Through astute decisions such as outsourcing logo design , engaging external teams for mobile application development, and investing in external website development expertise, Slack managed to secure a staggering $250 million investment, culminating in a total valuation of $5 billion in July 2017.

As of 2021, Slack’s valuation had soared to an impressive $27 billion. In 2020, it boasted a user base exceeding 10 million daily users, with projections indicating potential growth to nearly 80 million users by 2025, as reported by Statista. The Slack success narrative serves as a compelling testament to the potent impact of outsourcing on business expansion.

2. WhatsApp: Offshore Outsourcing for Market Expansion

WhatsApp is among the most popular messaging apps globally. It started as a small company with a capital of $250,000 in 2012 and had only 30 full-time employees and five part-timers. As of April 2022, it had over 2.44 billion users in more than 180 countries.

We can attribute WhatsApp’s success to using offshore developers from Russia. Its co-founder, Jan Koum, recognized the engineering talent in this country. Outsourcing allowed the company to focus on core operations and customer support while the BPO team handled the app development services . 

WhatsApp’s offshore outsourcing endeavor helped it reduce costs and build a successful product. Later in 2014, Facebook acquired the company for $19 billion. But while it relocated its third-party contractors to the United States , offshore outsourcing played a crucial role in its business growth and success.

3. CuriosityStream: Integrating Onsite and Offshore Teams

The successful experiences of its industry competitors inspired CuriosityStream, a global media company known for its video-on-demand streaming services, to begin an outsourcing journey.

In 2019, the company made the strategic move of enlisting the services of a team comprising six proficient programmers, entrusted with developing a new feature for its streaming platform. The collaboration with this BPO team not only contributed to an upsurge in viewer engagement but also substantially reduced operational costs.

Andre Silva, the company’s Chief Technology Officer, observed firsthand the transformative impact of outsourcing on their business scalability. Recognizing the potential synergy, Silva advocated for the integration of offshore teams with the in-house workforce, aimed at optimizing operational efficiencies.

Lessons Learned From Failed Outsourcing

BPO can be a valuable tool for companies looking to reduce costs, streamline operations, and grow their businesses. But outsourcing also presents unique challenges and risks that you should carefully manage.

Here is the truth: half of the outsourced projects fail outright or do not meet expectations. Three-fourths of businesses report management issues and hidden costs as culprits for this failure. About half were unhappy with their hired vendors’ performance, while 30% encountered communication problems.

The outsourcing case studies below reveal how some companies had to learn the hard way. You can also learn from them in your pursuit of outsourcing. Check out the BPO case studies below to learn how to maximize outsourcing and minimize risks.

1. Klout: Staying on Top of Privacy and Security

Launched in 2008, Klout was a social media analytics company that measured an individual’s influence. Its founder, Joel Fernandez, launched it through bootstrapping—starting a business with meager capital from personal finances. He already had an offshore team in Singapore, and joined them there for a while to cut operating costs. Three months later, he returned to the U.S. with a working prototype.

Later on, Klout faced a lot of controversy due to its role as a social scoring service. A software vendor, Lithium Technologies, eventually acquired it in 2014. But according to the software company’s CEO, Pete Hess, Klout was not aligned with their long-term strategy as a standalone service. So they had to shut it down.

In hindsight, there were a few reasons Klout failed as a business. For one, it outsourced user data management to third-party vendors and raised concerns about privacy and security. The company could have tapped into expertise and technology to improve its flawed scoring system. 

Lastly, it could have hired a reputable provider to create a more sophisticated tool capable of competing with other analytics tools such as Hootsuite and Buffer. Instead, it submitted to Lithium Technologies and saw its demise due to long-term goal misalignment.

2. PatientDox: Core Operations as the Primary Focus

PatientDox was a cloud-based startup that supplied healthcare providers with software-as-a-service (SaaS) technology. This platform offered secure messaging, appointment scheduling, and patient education tools to improve patient communication and satisfaction.

Despite its promising start, PatientDox’s downfall was due to its outsourcing case . Unfortunately, none of its co-founders had a software engineering or technical background, which led them to outsource. 

However, most of its outsourcing expenses went to product development, depleting its cash reserve and hindering its progress. The company’s third-party teams were also working on several projects simultaneously. They could not prioritize and meet consumer needs.

Further, PatientDox faced competition from other healthcare technology companies. Its poor outsourcing strategies, market changes, and stiff competition contributed to its unexpected demise.

3. JPay: Maintain Business Control

JPay was a technology company that provided services to incarcerated individuals and their families. Its services included electronic messaging, video visitation, and money transfers. This technology became a game-changer for affected individuals.

However, JPay’s success was short-lived. Initially, external developers helped build its infrastructure, technology, and resources. The company hired people in India for quality assurance, Israel for engineering, and China for hardware supplies. Ultimately, offshore outsourcing aided in its business growth and expansion. 

Unfortunately, such rapid growth and expansion overwhelmed Ryan Shapiro, the CEO. He could no longer take control of his company to navigate it in the right direction. In 2018, Securus Technologies, a company providing telecom services to correctional facilities, acquired JPay. However, the acquisition led to job losses and service disruptions for customers.

Unity Communications: Proof of Successful Outsourcing Cases

Unity Communications is an outsourcing company that operates globally, offering different solutions to businesses of all sizes. Since 2009, we have grown to provide front-office and back-end outsourcing services to companies across various industries. 

But as with any business, we also have our fair share of outsourcing failures and successes. What’s important is that we have grown and learned through all these years. We are proud to say our BPO case studies now showcase how proper outsourcing works. 

Explore the following case studies demonstrating how outsourcing can help your business meet its goals.

1. Wireless Watchdog: Developing a Custom SLA for Outsourcing Success

Wireless Watchdogs is an award-winning wireless management company. It faced operational challenges such as staffing and human resources (HR) issues. As its business grew and referral business increased, the need for responsive support staff became evident. 

Unity Communications developed a custom service-level agreement (SLA) to address the abovementioned issues. This contract included key performance indicators (KPIs) to measure outsourcing performance and track task efficiency. Our call center staff also underwent proper training and received management support to meet the target metrics.

In just a week, we managed to move many repetitive tasks to the offline team. This step allowed Wireless Watchdogs’s in-house team to free up their time and focus on core business operations. Ultimately, we exceeded the SLA terms by increasing service efficiency and work quality, not to mention having payroll savings on the side.

2. IT and Telecom Company: Establishing a Back-office Team

A well-known information technology (IT) and telecommunications company contacted Unity Communications. Due to a growing customer base, the company sought help for its back-office operations . It was facing operational challenges, limiting the company’s efforts to acquire new customers.

To address these challenges, Unity Communications helped them establish a back-office team consisting of three members and a project manager. The BPO team handled administrative tasks such as data entry, order processing, proposal creation, and overage reconciliation. 

Further, we tracked the team’s productivity through well-defined KPIs. Ultimately, the company’s productivity and customer satisfaction increased by 70% and 92% respectively in just two months. The company now has a streamlined back-office process that efficiently delivers quality work.

The Bottom Line

Outsourcing is a viable option for improving your business operations. But using this strategy with extra caution and a solid plan is crucial. Consider the case studies of different companies presented here to learn a thing or two.

Remember to weigh the potential benefits and risks of outsourcing. Examine your current business operations and search for outsourcing partners. More importantly, hire the BPO service provider best suited for your business. With these, you can avoid the pitfalls of failed outsourcing and reap the benefits of successful outsourcing.

Ready to take advantage of outsourcing without risking your business? Reach out to us, and let’s connect ! Unity Communications is ready to handle the nitty-gritty tasks while you focus on achieving your goals and growing your business. 

We Build Your Next-Gen Team for a Fraction of the Cost. Get in Touch to Learn How.

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Thrilling IT Outsourcing Case Studies Businesses Can Learn from

The 21st century has been undergoing a revolution in the way businesses handle business tasks. In the past, establishing an in-house team was a golden rule that no business wanted to break. More and more companies are looking outside of their organizations for ways to grow their business. Outsourcing has become more than a trend now; it’s necessary for businesses that face increasing production costs or labor shortages.

Outsourcing allows organizations to work with top talent, save costs, and scale up or down easily. However, many organizations are still cautious when it comes to delegating their operations to third parties because of security and delivery concerns.

To dispel these fears, our IntelliSoft experts have prepared a list of the top 10 examples of companies that outsource, and you will learn about them in this article. At IntelliSoft, we know what makes an outsourcing case successful, and we want to share this knowledge with you to help you avoid mistakes and find the best development partner. Buckle up and keep on reading.

Table of Contents

What is IT Outsourcing?

IT outsourcing involves entrusting specific business operations to third-party providers specializing in those tasks. This strategy aims to cut costs and optimize in-house processes by allowing external experts to manage and control these operations.

According to a global IT outsourcing market study, the industry will grow by $98 million by 2024, with a Compound Annual Growth Rate (CAGR) of 5%. It’s no wonder the industry will keep proliferating since outsourcing covers software as a service, utility services, various infrastructure solutions, and more. You can delegate almost any part of non-core business processes to third-party providers, and there’s a vast talent pool to choose from.

IT outsourcing can be done in your country or outside it. The three types of outsourcing include onshore, nearshore, and offshore outsourcing.

Onshore outsourcing involves hiring a third-party company in your city or nearby. It allows you to control the processes, save costs, and communicate freely because you are in the same time zone and speak the same language.

Nearshore outsourcing is when you work with providers in neighboring countries. As a result, you are in the same time zone, but the costs can be cheaper.

Offshore outsourcing is when you delegate tasks to another country, often on another continent. This type of outsourcing is believed to be the cheapest.

Why do you need to outsource?

Running a business alone is impossible, even if you are the most talented business owner with years of experience and technical skills. Any business owner needs a team to succeed, and hiring an in-house team can be time- and money-consuming. Also, you can’t be sure you will find skilled experts in your area, especially if you need people with knowledge in rare industries or technologies.

That is why you need to outsource – to bring your ideas to life and grow your business while saving costs and working with experienced professionals. There’s a vast talent pool of experts, so why not use this opportunity?

When do you need to outsource?

The reasons why companies decide to outsource vary from business to business. Some companies opt for outsourcing when they start growing their business; others delegate their operations after establishing a brand. Thus, there’s no definite answer to when you should start outsourcing your processes. To make the right decision, you need to consider the following factors:

• How many people can you employ by outsourcing without affecting your internal processes
• How much money can you spend on outsourcing
• Whether outsourcing aligns with your business plan and will help you achieve your end goals
• Whether you can find the needed experts by outsourcing

Before opting for outsourcing, you need to assess your business state, needs, goals, and budget. Then, you will realize whether outsourcing is an option or whether you should choose a different cooperation model.

Benefits of Outsourcing

If so many businesses stick to outsourcing their processes, it must have numerous benefits, right? It sure does, and it has proven to be a more effective way of collaboration than working with an in-house team.

Before talking about IT outsourcing examples, let’s look at the main advantages of outsourcing and why it’s believed to take over the market.

• Lower costs The key reason why businesses choose outsourcing is because of lower costs. Indeed, every company cannot handle creating an in-house team and spending money on employment, training, and purchasing tech infrastructure. With outsourcing, there’s no need to spend money on any of that because the outsourcing vendor handles everything from recruitment to taxes. Moreover, outsourcing allows transforming fixed IT costs into variable costs so that you can plan your budget more efficiently.
• More flexibility and agility Challenges, issues, and bugs always accompany software development. Your task here is to ensure that you are flexible and adaptable enough to face these challenges and resolve them quickly. Fortunately, outsourcing companies can easily adapt to changing needs and respond to issues as they arise because they have a lot of experience in this. Your goal is also to resolve problems as fast as possible, meeting the demands with more agility, and outsourcing is a great way to achieve it.
• Higher quality of services Outsourcing is one of the best ways to enhance your operational efficiency and take your business to another level. With the number of outsourcing companies growing each day, they are competing for the client’s attention, and what’s a better way to do that than outperform competitors in terms of service quality? If you choose a specialized supplier with years of industry experience that uses the latest technology, you will receive an excellent product.
• Focus on core business tasks While an outsourcing company handles a part of your business processes, you can focus on core business tasks. The autonomy of third-party vendors is an excellent benefit that cannot be overlooked; you don’t have to control every aspect of the process and waste time on management. Instead, you can focus on your business strategy and other essential tasks while your project is being developed simultaneously.
• Access to the global talent pool You can’t even imagine how many talented and highly skilled experts are waiting for you to work with them. By outsourcing your processes, you open yourself to the world of talent and possibility as you can connect with the top specialists from different industries. This is a great solution to talent shortage as you are not limited to any location with outsourcing, so if there’s no one in your city or country, you can look further.

Related Readings

• Nearshoring. What is it and for Who?
• What is Staff Augmentation? A Model to Extend Your Team
• Outsourcing vs. Outstaffing Models: What Is the Difference and Their Pros & Cons
• Everything You Need to Know About Team Extension and Dedicated Team Models
• 10 Best Countries for Hiring a Dedicated Development Team

IT Outsourcing Success Stories

Which is the best example of outsourcing, you may ask? There are numerous successful outsourcing cases, both from small and top companies. We have compiled a list of the top 10 examples of companies that outsource to inspire you and prove that outsourcing is an awesome way to grow your business.

The first among business outsourcing examples is Slack. Everyone uses Slack these days. If you’re working in a tech company, the chances are that you’re using Slack for collaboration. Slack has over 42.7 million daily users as of 2023, and the company is valued at $26.51 billion. These impressive numbers wouldn’t be the case if Slack hadn’t decided to outsource its operations at some point.

They needed to develop the beta version of their business model, so they hired an outsourcing company named MetaLab from Canada to do that. The company helped Slack build a tool for increasing traction. Slack also outsourced the design of its logo and mobile app, securing an investment of $250 million.

By understanding its needs and goals and finding the right partner, Slack was able to take the company to a whole new level and become one of the top successful cases of outsourcing.

Another case study on outsourcing is WhatsApp’s journey. It has more than 2 billion users, but it hasn’t always been the case. WhatsApp started as a small company with 30 employees in 2012. In 2022, its annual revenue reached over $906 million . How did that happen? Through outsourcing its development operations.

Jan Koum and Brian Acton, the founders of WhatsApp, hired offshore developers from Eastern Europe to save costs and handle the app development services. Working with an offshore company allowed WhatsApp to focus on core business tasks and sell the company to Facebook for $19 billion in 2014.

Daintel is the next example of offshoring companies. In 2007, Daintel – a clinical workspace for Intensive Care Units from Copenhagen – hired us to enhance the capacity of the Daintel R&D department and improve the performance of the existing solution used in hospitals.

We optimized the performance of Daintel’s system and the connection pool using base connection storage developed on Firebird, an open-source SQL relational database management system, to omit this challenge.

We also created new modules for the Intensive Care Unit, including Prescription, Administration, the SNOMED CT, IOM Graphic, CPOE module, EMM, and others.

The IntelliSoft team started working with Daintel 4 years ago from 2 dedicated developers, and by 2018, we managed to build a dedicated R&D center. As a result, the Daintel Intensive Care Unit system has become a healthcare market leader.

CuriosityStream

CuriosityStream is also among the successful outsourcing examples. It is a global media company, and streaming service, which began outsourcing its processes in 2019. The company hired six third-party developers to work on the video feature that would increase the number of hours watched and reduce operational costs.

The company decided to opt for outsourcing when it saw its competitors do it and succeed. Once they did it, the company’s CEO, Andre Silva, decided to integrate outsourced teams to help with other operations as well, and CuriosityStream continues to work with third-party developers to this day.

Who would have thought: Google also outsourced its operations to third-party vendors. Even though it’s an evident leader among top tech companies, and it seems that Google can easily handle all operations in-house, it still decided to outsource to reduce labor costs.

Google, perhaps the best example of offshoring companies, has an 89,000 in-house team of employees, and it still can’t handle all the tasks. This made Google look for contractors in other countries. Since 2018 , the number of third-party contractors has outnumbered the number of their in-house employees.

The tech giant hires talented experts worldwide and works with contractors on its AdWords project. The company does it for two reasons: it allows them to work with top talent they don’t have in their in-house team and helps them cover the gaps when Google employees take parental leaves. Moreover, outsourcing helps Google majorly reduce labor costs and maintain impressive profitability.

Basecamp is also among the IT outsourcing examples. It is a project management tool that allows users to create to-do lists, share files, track time, and chat in forums. When the company grew, and its requirements grew, its leaders realized that it could affect their future if they didn’t solve international issues like workflow management and client support. Thus, Basecamp outsourced its core development functions, and its internal teams could focus on other business processes.

SpecTec is another IntelliSoft’s case study on outsourcing.

In 2017, we started working on a new outsourcing project SpecTec. The SpecTec company is a leading Maritime software provider, developing AMOS software (Asset Management Operating System) for Oil Gas, Maritime, and Defence industries.

Our team was responsible for working on AMOS functionality and ensuring that it was fully functional online and offline, using data transfer between mobile devices used in field operations and local databases.

We also worked on the development of the AMOS Maintenance app, AMOS Inventory app, a quality management system, and web approvals.

As a result, we optimized the company’s existing architecture and ensured successful offline and online data synchronization for Inventory and Maintenance applications. It helped SpecTec increase its productivity and efficiency and meet its business goals.

Skype is another successful outsourcing case study. You have probably used Skype for communication at some point in your life or continue to use it, and yes, it also outsourced its business operations.

Skype decided to delegate the majority of its software development to European developers as it needed professional web development. Since the company did not have enough in-house developers, outsourcing was the best solution. As we can see from the success of Skype, outsourcing has worked wonders.

GitHub is a well-known open-source website hosting software development version control using Git. Over 94 million developers are loyal fans of GitHub, using it for their projects and communication with other developers.

The company recruited Chacon as its third-party company of choice to create the website’s backend. In fact, a developer who built the backbone of GitHub is now its CIO.

GitHub hired the best experts to build its backend, and outsourcing became a great solution for completing business tasks while adhering to the highest quality standards and saving resources and money.

Ingram Barge

Ingram Barge is one business outsourcing example from our portfolio. In 2016-2017, the IntelliSoft team built a custom fleet management app for a leading carrier in American inland waterways. Ingram Barge requests us to build a fleet management and freight tracking web app to visualize and manage barges in fleets.

They also needed help with creating a project that would provide rich UI capabilities and real-time synchronization between clients, integrating external services and tools via a wide-ranging API.

During the eight months of work, our talented team developed a web app that included the following functionality:

• Fleet management dashboard
• Time tracking
• Offline mode
• SignalR integration
• Updates feed

We collaborated tightly with the customer’s team to seamlessly integrate this app into their existing infrastructure and provide end users with an efficient tool they use daily.

How to Find the Right Outsourcing Partner?

Now that you have learned about IT outsourcing examples, it’s time to pick a vendor.

Picking a partner in such a vast talent pool can be daunting, especially if you have never outsourced before. Fortunately, there are some tips and tricks on picking the right vendor, and following them will help you stress less and find a reliable partner.

• Evaluate your needs There’s no point in looking for a development partner if you don’t understand what you need from this cooperation. You need to assess your business state, technological capability, and what your in-house lacks that a third-party company can provide. After you outline the strengths and weaknesses of your in-house team, you will be able to know what to look for. For example, you may have a strong team of engineers but lack expertise in design, or vice versa. Thus, your further steps will depend on determining your needs first.
• Define your requirements Next, define what kind of project you want, the market it will compete in, how much money you’re ready to pay, and the approximate deadline. Write down as many requirements as possible at this point, and as your potential partner, go through them and tell you if some are unrealistic. A good development partner will help you come up with more realistic requirements and tell you how to achieve them.
• Check companies’ expertise After you write down your needs and requirements, move on to the next step – reaching out to vendors. For instance, you can create a list of 5-10 vendors and evaluate them based on their tech expertise, skills, access to the latest technology, experience, and interest in your project.
• Read the reviews While evaluating your potential vendors, check their Clutch profile. Read the previous clients’ reviews there, talk to them about cooperation with the vendor, and ask questions. Make sure that the vendor has worked on relevant projects to yours before and that they have great reviews.
• Protect your data Privacy and data security are essential for any business, especially when outsourcing their business operations. Working with third parties always involves sharing sensitive business information, so it has to be managed properly and protected against breaches and leaks. Make sure that your data is protected, and sign a nondisclosure agreement with your vendor.

How can IntelliSoft help?

IntelliSoft has been offering team extension services for more than 15 years, helping clients with projects of various complexity, from developing custom applications to rebuilding architectures. We have numerous IT outsourcing examples in our arsenal. At IntelliSoft, we offer a pool of smart applicants and managers to assist with selecting the best practices for your business without wasting time and other valuable resources on tiring, confusing hiring procedures.

We offer help with projects with obscure requirements, long-term projects, and startups and small companies that want to grow their businesses. The types of collaboration we offer include:

• Staff augmentation With this cooperation model, you pay for the operational expenses and have a PM on both your and our sides. The primary goal here is to offer labor and necessary tools for your projects.
• Outstaffing With outstaffing, the quality ownership is on your side, and you pay for the additional staff. The goal is to extend your in-house team with the right professionals.
• Dedicated teams Our dedicated team works as your tech partner, providing the necessary resources and people to work on your project. You pay for intellectual property in this case, and we handle all the processes.

If you have been looking for a vendor to help you with web or mobile app development, QA and testing, implementation of AI, ML, and other technologies, digital transformation of your business, or cloud computing, we are here to help.

Outsourcing is one of the most effective ways to save money and work with top talent worldwide without the need to move your business to another country and employ new people. It can sound too good to be true, but the successful outsourcing examples we covered in this article demonstrate that outsourcing can take your business to a whole new level if approached wisely. It’s an effective collaboration model both for startups and industry leaders. All you need to do is understand your needs and know what to look for in a vendor. Contact us if you have been looking for a team to handle your business operations or need a consultation.

How do companies choose the right IT outsourcing partner for their specific needs?

Choosing an IT outsourcing partner is not an easy task, as it requires careful consideration. Companies usually check vendors' expertise, previous cases, years of experience, and specific technological solutions they use. Evaluating candidates' track records, reviews, and reputations is also important. Your vendor's culture should align with your company's culture, and you should be on the same page regarding communication and project management capabilities.

What are the potential cost savings associated with IT outsourcing?

IT outsourcing helps reduce labor costs, especially when outsourcing to lower-wage regions. Moreover, you don't need to invest in infrastructure, recruitment, bonuses, etc. Outsourcing also allows businesses to focus on their core competencies, potentially increasing efficiency and productivity, which can translate into financial savings.

How does IT outsourcing impact a company's internal IT team and overall operations?

IT outsourcing can positively and negatively influence in-house teams and operations. It can help in-house teams focus on more important business tasks, improving their productivity. If you want to fill in some knowledge and skill gaps in your team, outsourcing can help with that, too. However, your team may need to adapt to a new working relationship with the vendor.

What are the essential steps to take before starting an IT outsourcing engagement?

Define your objectives clearly Assess your needs Research potential partners Establish clear communication channels Ensure the security of data Create a detailed contract

How can businesses evaluate the success and performance of their IT outsourcing initiatives?

It is possible to evaluate the success of outsourcing through various methods:KPIs: Cost savings, quality of deliverables, project timelines, and customer satisfaction. Cost-benefit analysis: Compare the cost savings with the initial expectations. Service quality assessment: Gather feedback from internal stakeholders and end-users. Vendor performance review: Conduct performance reviews to address any vendor issues and identify opportunities. Business impact analysis: Assess how outsourcing has impacted your business operations, strategic objectives, and employee productivity.

Is IT outsourcing suitable for all types of businesses, regardless of size or industry?

The size of a business or industry does not matter as much as individual needs and requirements. Small and medium-sized businesses often find outsourcing beneficial as it allows them to access specialized skills and resources without the need for significant upfront investments. Larger enterprises may also outsource to streamline operations and focus on core competencies.

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The risks and rewards of outsourcing

Outsourcing is nothing new to big companies in the energy and materials industries. Many have relinquished control of lower-value functions, such as payroll, or even slivers of the value chain that are more central to their business. Mining companies lease trucks and rail freight, for example, and most oil companies outsource drilling.

To date, however, these same companies have seen little reason to let go of higher-value functions, such as exploration and operations, as their scale has enabled them to develop world-class capabilities in-house. But data are changing the game. In a data-rich world, their capabilities could be exceeded by those of their suppliers. And while this holds the potential for greater efficiency and effectiveness, it also comes with major risks. Unless handled carefully, there is a danger that an outsourcing arrangement that delivers gains in the short term could, over time, create an unhealthy dependency, eroding competitive advantage and strategic options. No company can afford not to join the digital ecosystems forming around every industry, but each must do so without giving away the keys to the business.

The case for and against extensive outsourcing

To understand the digital forces at work , consider a global manufacturer of turbines: it probably already has more data on their performance than even the largest customer and so could, potentially, maintain them better. It might make sense, therefore, for customers to outsource the supply and maintenance of turbines rather than buy them and maintain them in-house.

In the minerals industry, some companies already employ external technology specialists to track and improve productivity in their processing plants using the Internet of Things (IoT). Some of these specialists then aggregate the data they collect from many different companies. The result could be a burgeoning new business—a platform with vast libraries of data and algorithms to which customers would be able to buy access. As with the turbine manufacturer, the insights that a platform operator would be able to deliver using these data could be far greater than those any single company could hope to uncover on its own. The prospect then arises of platform companies in unrelated areas, such as banking, groceries, and healthcare, moving into the energy and materials value chain. Microsoft has already launched predictive-maintenance services enabled by the IoT. And could a company such as Amazon take over logistics?

Many specialists and niche suppliers are already emerging with offers to take over processes or whole parts of a business. And their services could prove tempting, given the potential for rapid rewards. The operations of a steam boiler could be optimized in weeks by comparing its performance data against the supplier’s much bigger proprietary database, for example. Procurement costs could be rapidly reduced by a specialist with automated cleansheet models that reveal with ease the real cost of a service or product and any room for price negotiations.

And it is not just big companies that stand to benefit . Smaller ones could, for example, develop a fleet-maintenance strategy as sophisticated as those of the heavyweights in their sector by outsourcing management to a global supplier that can collate data from the hundreds of thousands of sensor-laden vehicles it manages in order to optimize the fleet’s performance.

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Outsourcing boundaries.

The devil is in the detail, of course. For the purposes of this article, we define “outsourcing” as the provision of an ongoing service, such as vehicle maintenance or railroad operations, rather than a one-off service, such as building IT infrastructure. As in the old world, two factors will determine which ongoing services lend themselves to outsourcing: whether outcomes can be clearly defined, and the supplier’s edge. But in a data-rich world, there are new dimensions to both.

Companies contemplating outsourcing a function need to be certain that the desired outcomes can be clearly defined in a contract and progress toward them monitored. Hence, management accounting is hard to outsource. So is work conducted with a supplier in agile teams, where the product or function constantly evolves. In an agile world, a contractor will commit time and resources but cannot generally guarantee a particular result. Indeed, sometimes the exercise will fail. Therefore, joint ventures or gain-sharing agreements might be more suitable than an outsourcing contract when working with suppliers in this way.

Bear in mind, however, that data and artificial intelligence now make it easier to draw up contracts, extending outsourcing’s potential reach. For example, more accurate demand prediction through machine learning coupled with tighter control over supply chains through sensors and tracking devices make it easier to define performance in a contract to outsource materials management. And in some respects, the more a company outsources, the easier it is to specify the outcome. It is more straightforward to define an outcome for a whole service, such as railroad transport, than for a small component of that service, such as railroad-track maintenance. The level of activity required to maintain track is hard to gauge, but that becomes the railroad operator’s concern once the tonnage of coal to be transported has been quantified.

The supplier’s edge

If a function lends itself to being contracted out, the next consideration is the supplier’s edge: Does it have a structural advantage? A structural advantage might lie simply in a supplier’s lower costs. But in a data-driven world, two other sources of advantage are particularly important. The supplier might have data and technology that a customer would struggle to replicate: access to a large data pool on compressor performance, say, or a proprietary solution to finding dependencies between large data sets or parameters. Or it might have skills and capabilities the customer cannot match. With demand for people with big data skills outstripping supply, for example, outsourcing could be one of the few practical ways for a resources company to secure the talent required to develop algorithms for predictive maintenance.

When a supplier offers a structural advantage in low-value functions, the decision to outsource is not hard to make as little value is at risk. But increasingly, suppliers may hold an advantage in functions deemed more critical to the business, such as ore extraction or seismic surveys, or in an area where, hitherto, the company has held a strong competitive advantage, such as finding and developing attractive resources or operational excellence (exhibit). Here, companies need to proceed much more cautiously when outsourcing.

With time, technology will undoubtedly break up the traditional value chain in the energy and materials industries as companies are forced to conclude they enjoy a competitive advantage in far fewer functions than they do today. Eventually, they might be able to outsource entire stages of the value chain. A miner could outsource all its operations—blasting, extraction, haulage, processing, freight, and marketing—to contractors with the data and accompanying expertise to drive down costs and raise productivity and safety. Such developments would force a radical reassessment of what constitutes a core business capability, and different companies would likely come to different views. One might find that discovering and developing new resources is its core strength; another might realize that marketing skills set it apart. The time has not yet come to make such seemingly existential decisions. The future impact of technology remains far too unclear. What companies should do, however, is ensure they capture the short-term gains that outsourcing can deliver in a way that does not limit their future strategic options. Following certain ground rules will help.

The outsourcing ground rules

Examples of extensive outsourcing of high-value functions are, for now, few and far between. Yet based on the dynamics we have seen gathering strength, we suggest three ground rules companies should observe in a fast-changing world.

Keep digital control in-house

Companies need to guard against outsourcing arrangements or partnerships that prevent them from adopting new technologies or contracting with new vendors. Hence, they need to avoid deals that hinge on the use of proprietary or niche technology. Open technology standards will be key to maintaining future strategic options.

They also need to control data and system architecture so they can change with the times as new and unforeseen options emerge. Three years ago, for example, few businesses knew how important cloud computing would become. While support might be sought for the execution of a technology strategy, decisions about what data to keep, where to store and process them, and how applications can access and manipulate them need to be made by the company alone. In addition, any outsourcing arrangement must be structured in a way that enables the architecture to be changed with limited penalties.

Companies must also maintain control of their data and the insights derived from them . Sharing data, selectively, can be beneficial. Two companies that pool data on well failures will both be able to improve their models. But they also both need to keep ownership of their data, for three reasons. First, good data, and large volumes of them, make for better decisions, as they are used to train advanced-analytics and artificial-intelligence models. Those with the biggest and best databases will be those with the best models and predictive power, able to outcompete others. Second, giving away data increases dependency on suppliers. If, for example, the data generated from a company’s machinery are owned by the machinery’s manufacturer, the company will be reliant on the manufacturer to help it optimize operations and will find it harder to build its own advanced-analytics skills. Third, the data it supplies could be used to help build models that are sold to competitors.

The same goes for any insights generated by the data and the algorithms a provider might develop to optimize a customer’s performance. These should be the company’s property, or at least the company should retain the right of use even after the outsourcing contract ends. Otherwise it might find it has to retain the supplier as long as the algorithm is being used and might not be able to update, train, or combine algorithms.

Suppliers that offer use of their platforms in exchange for data at what seems like a bargain price should be treated with caution. The data are likely to become someone else’s product.

Keep contracts flexible

Both parties need suitable incentives for an outsourcing arrangement to succeed. The usual ones—sharing gains and rewarding outcomes rather than inputs—still apply in a digital age. But where outcomes are concerned, flexibility will be required.

Technological developments could necessitate the frequent rewriting of agreed outcomes and how they are measured. For example, a fall in supply-chain costs might be the main aim at the start of a contract, but overnight delivery of spare parts could become more important once predictive-maintenance technology beds in. Likewise, advances in technology during the life of a contract might deliver additional, unanticipated cost savings that would accrue to the supplier unless specified otherwise. Companies must thus ensure they can exit a contract or change the terms without severe penalties and avoid locking into lengthy agreements even if substantial cost savings are promised. Eventually, it might be desirable to take the work back in-house or use another supplier to maintain competitive tension.

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Maximize competitive tension

The third ground rule, maintaining competitive tension, takes on even more importance in the digital era because of the winner-takes-all dynamic. The more data a supplier has, the better its insights, the more customers it attracts, the more data it gathers—and so on. Soon, its scale enables it to outperform other suppliers and create a dominant position.

The risks of outsourcing to a single, dominant supplier might not be obvious initially, as digitization reduces the barriers to entry, prompting a proliferation of new players, all rushing to capture value and competing strongly. But over time, the need for scale and the benefits it delivers will bring about consolidation, reducing competitive tension. The risk of losing leverage over a supplier through a lack of credible competition is therefore significant. In addition, becoming too entrenched with a single supplier can make switching costs high, as many companies have found with enterprise-resource-planning systems.

To help maintain a healthy level of competition, large companies can spread their custom among several suppliers and nurture smaller ones, although this does not come without a cost either. Interfacing with the technology stacks of various suppliers, for instance, can eat up time and money—another reason to keep the technology strategy in-house and use open standards.

Outsourcing can be hugely beneficial and sometimes even critical to capturing the potential of new digital technologies and capabilities. Some companies might choose to outsource in order to buy time to build their own skills and capabilities, while smaller ones might outsource to leverage the capabilities of new suppliers and their vast data sets, gaining insights that once only the largest companies could hope to enjoy. Ultimately, when up against increasingly smart and capable suppliers, many companies might have to rethink their core business. But in the meantime, they need to be highly strategic in their decisions about what to outsource and how.

Calin Buia is an associate partner in McKinsey’s Perth office, where Christiaan Heyning is a partner and Fiona Lander is a consultant.

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Case Study: Business Process Outsourcing Company

Fortune 100 business processing company specializing in outsourced administrative functions and human resource technologies., the problem.

Our client was facing a busy business cycle that saw its own business bookings up 18% in the quarter and 13% for the year, which meant more transactional work for the legal department. Unfortunately, attrition had created two openings in the department just when those services were needed most. The client wanted AmLaw 100 trained transactional attorneys with large contracts negotiations experience to support their multinational accounts business.

The Solution

Major, Lindsey & Africa's Interim Legal Talent group helped identify multiple AmLaw trained deal lawyers with the contracts negotiation experience the client required. We effectively filled both open positions with temporary contract attorneys. Both came with a high level of skills and experience, including what was required by the client's multinational business.

The Success

Both positions were filled in a relatively short period of time and met the client's needs for a short-term assignment. Ultimately, one candidate was converted to a full-time employee.

Transactional

By using interim legal talent, you can take the time to carefully consider direct placement hiring options and find an excellent candidate while getting the work done in the meantime.

Need time to figure out the right structure of your legal team before making permanent hires? Take that time and still get the work done with the support of consulting attorneys.

Our client was using an AmLaw 50 firm to handle IT vendor contracts. Recognizing the significant expenses associated with using traditional outside legal counsel, our client sought a more cost-effective approach to meet their legal needs without compromising on quality or expertise.

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The attraction of bpo.

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What Is Business Process Outsourcing (BPO), and How Does It Work?

Investopedia / Michela Buttignol

What Is Business Process Outsourcing (BPO)?

Business process outsourcing (BPO) is a method of subcontracting various business-related operations to third-party vendors .

Originally used in manufacturing to manage supply chains, BPO now spans various industries, including healthcare, asset management, energy, pharmaceuticals, e-commerce, and others, to enhance efficiency, reduce costs, and leverage specialized expertise and advanced technology.

Key Takeaways

• Business process outsourcing (BPO) involves using third-party vendors to handle specific business operations.
• Initially used by large manufacturing companies for supply chain management, BPO now spans various sectors, including services.
• BPO vendors invest in the latest technology, such as AI and advanced analytics, allowing companies to use cutting-edge solutions and improve processes while saving costs.
• BPO is considered "offshore outsourcing" when vendors are located in different countries, such as for customer support.
• BPO has evolved into a standalone industry, with specialized companies providing outsourcing services globally.

Understanding Business Process Outsourcing (BPO)

Many businesses, from small startups to large companies, opt to outsource various processes due to the availability of innovative services in today's highly competitive and dynamic business environment.

Broadly speaking, companies adopt BPO practices in the two main areas of back-office and front-office operations. Back-office BPO involves contracting its core business support operations, such as accounting, payment processing, IT services, human resources, regulatory compliance, and quality assurance, to outside professionals who ensure smooth business operations. This approach may see the business leverage technological trends like cloud computing and AI, which improve efficiency and quality while reducing costs.

By contrast, front-office BPO tasks commonly include customer-related services such as tech support, sales, and marketing. These services help businesses improve customer experience and maintain a competitive edge in the market.

The global business process outsourcing market was valued at $281 billion in 2023 and is projected to grow at a compounded annual growth rate of 9.6% from 202 to 2030.

A business's range of BPO options depends on whether it contracts its operations domestically or internationally.

BPO is considered"offshore outsourcing" when the contract is sent to another country that offers political stability, lower labor costs, or tax savings. One example is a U.S. company using an offshore BPO vendor in Singapore.

"Nearshore outsourcing" refers to contracting work to a neighboring country. For example, a U.S. company partnering with a BPO vendor in Canada falls under this category.

A third option, "onshore outsourcing" or "domestic sourcing," occurs when BPO is contracted within the company’s country, even if the vendor is in a different city or state.

BPO is often called information technology-enabled services (ITES) because it relies on technology and infrastructure that enables external companies to perform their roles efficiently.

Companies are often drawn to BPO for its ability to provide greater operational flexibility. By outsourcing non-core and administrative functions, businesses can reallocate time and resources to core competencies like customer relations and product innovation, gaining an edge over competitors in their industry.

BPO also grants access to cutting-edge technological resources that might otherwise be out of reach. BPO partners continuously adopt the latest technologies and practices to improve their processes.

The U.S. corporate income tax is one of the highest in the developed world and could rise further with Biden’s proposal to increase the federal corporate income tax rate from 21% to 28%. Consequently, outsourcing to countries with lower taxes and labor costs becomes an effective cost-reduction strategy for American companies.

BPO also offers companies the benefits of quick and accurate reporting, improved productivity, and the ability to swiftly reassign its resources when necessary.

Biden’s proposal to raise the federal corporate income tax rate from 21% to 28% would increase the United States’ combined state and federal corporate tax rate to 32%. This change would make the U.S. corporate tax rate nearly 50% higher than the OECD average. Consequently, outsourcing operations to countries with lower taxes and labor costs would become a more attractive cost-reduction strategy for businesses.

Some Disadvantages of BPO

While BPO offers many advantages, it also has drawbacks. A business that outsources its business processes may be prone to data breaches or communication issues that delay project completion. Additionally, businesses often underestimate the ongoing costs of BPO providers.

Another potential downside is customer backlash if outsourcing is perceived as compromising quality or negatively impacting domestic employment.

BPO is a highly lucrative field: The estimated total pay for a Business Process Outsourcing professional in the United States is $205,756 per year, with an average salary of $125,808 per year.

What Is the Goal of BPO and What Are Its Types?

BPO is the abbreviation for business process outsourcing, which refers to when companies outsource business processes to a third-party (external) company. The primary goal is to cut costs, free up time, and focus on core aspects of the business. Two types of BPO are front-office and back-office. Back-office BPO entails the internal aspects of a business, such as payroll, inventory purchasing, and billing. Front-office BPO focuses on activities external to the company, such as marketing and customer service.

What Are the Advantages of BPO?

There are numerous advantages to BPO. One of the primary advantages is that it lowers costs. Performing a certain job function internally costs a specific amount. BPO can reduce these costs by outsourcing this job to an external party, often in a less cost-intensive country, reducing the overall cost of performing that job function.

Other advantages include allowing a company to focus on core business functions that are critical to its success rather than administrative tasks or other aspects of running a company that are not critical. BPO also helps with growth, particularly in global expansion. If a company is interested in opening an overseas branch or operating overseas, utilizing a BPO company that has experience in the local industry and speaks the language is extremely beneficial.

What Are the Types of BPO Companies?

There are three primary types of BPO companies. These are local outsourcing, offshore outsourcing, and nearshore outsourcing. Local outsourcing is a company in the same country as your business. Offshore outsourcing is a company that's in another country, and nearshore outsourcing is a company that's in a country not too far from your own.

What Is a BPO Call Center?

A BPO call center manages incoming and outgoing customer calls for other businesses. It employs agents who can handle customer complaints or inquiries for multiple companies, often within a specific industry. For example, a call center agent may provide tech support for different vendors or manufacturers.

Business process outsourcing (BPO) utilizes third-party specialists to carry out some part of a business process or operation (as opposed to outsourcing the entire production). BPO can lower a company's costs, increase efficiency, and provide flexibility. At the same time, the BPO industry is rapidly growing, which means that in our increasingly global economy, process outsourcing isn't going anywhere.

IBM. " What Is Business Process Outsourcing (BPO)? "

Grand View Research. " Business Process Outsourcing Market Size, Share & Trends Analysis Report By Service Type (Customer Services, Finance & Accounting), By Outsourcing Type, By Deployment, By End-use (IT and Telecommunication, BFSI), By Region, And Segment Forecasts, 2024 - 2030."

Cato Institute. " President Biden Would Make the US a Tax Rate Outlier ."

Glassdoor. " How Much Does a Business Process Outsourcing Make? "

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Hvac, Plumbing, Electrical And Roofers: The Call Center Outsourcing Guide

Sydney Andersen

• August 10, 2024

In the ever-evolving landscape of modern business, the concept of outsourcing has become a crucial strategy for many industries. For contractors specializing in HVAC, plumbing, electrical, and roofing services, managing customer inquiries and service requests can be a significant challenge. This blog aims to provide a comprehensive guide to call center outsourcing, highlighting its benefits, considerations, and best practices.

What is Call Center Outsourcing?

Outsourcing customer service operations is a strategic decision that involves partnering with an external organization to handle specific tasks or an entire operation. This approach can be particularly beneficial for field service contractors who need to focus on their core business activities while maintaining high-quality customer interactions. External Customer Service organizations exist to provide call center outsourcing services, supplementing or replacing in-house operations. This model does not require a complete sweep of your customer service or sales department; you can choose to outsource specific tasks or levels of your business, or the entire operation if that is the solution needed.

Why Should You Outsource Your Call Center?

One of the primary reasons for outsourcing call centers is to reduce operational costs. By leveraging specialized providers, you can eliminate the need for internal resources, such as trainers, quality monitors, and agents. This approach also allows for a more flexible staffing structure, which can be beneficial when dealing with seasonal fluctuations in demand. Additionally, outsourced call centers often have the necessary infrastructure and expertise to manage multiple communication channels, making it easier to add new channels like live chat or social media.

Choosing the Right Outsourced Contact Center

When selecting an outsourced contact center, companies should consider several key factors. These include the provider’s reputation, expertise in your industry, and their ability to meet your specific service level agreements (SLAs). It is essential to visit the center, either physically or virtually, to understand their company culture and the surrounding environment. This site visit can help you assess the provider’s capabilities and alignment with your business ethos.

Benefits of Outsourcing Your Call Center

Cost savings : Outsourcing can significantly reduce operational costs by eliminating the need for internal resources and infrastructure.

Increased efficiency : Specialized providers can streamline operations and improve service quality.

Flexibility : Outsourced call centers can accommodate flexible staffing needs and support seasonal fluctuations in demand.

Enhanced customer service : Providers can offer multilingual support and round-the-clock service, enhancing customer satisfaction.

Considerations Before Outsourcing Your Call Center

While outsourcing can bring numerous benefits, it is crucial to address potential drawbacks. Companies must ensure that the outsourced service will meet or exceed the quality of an in-house operation. This requires careful evaluation of the provider’s expertise, infrastructure, and service level agreements. Additionally, companies should consider the potential lack of control that comes with outsourcing and ensure that the provider’s company culture aligns with their own.

Best Practices for Outsourcing Your Call Center

Define clear service level agreements (SLAs) : Establish specific performance metrics and response times to ensure high-quality service.

Develop a comprehensive training program : Ensure that outsourced staff are trained to meet your specific requirements and service standards.

Regularly monitor and evaluate performance : Continuously assess the quality of the outsourced service and take corrective actions as needed.

Case Studies and Success Stories

Numerous companies have successfully outsourced their call centers, achieving significant benefits. For example, Exient, a software contracting firm, has seen success by conducting daily virtual gatherings with clients, showcasing the effectiveness of domestic outsourcing. Similarly, Bill.com, a tech company, has experienced satisfaction with its new form of outsourcing, marking a shift from traditional offshoring practices.

The Future of Call Center Outsourcing

The future of call center outsourcing is likely to involve a greater emphasis on technology and data analytics. As customer expectations continue to evolve, providers will need to leverage advanced tools for issue monitoring and data-driven decision making. Additionally, the use of artificial intelligence and chatbots will become more prevalent, enhancing the efficiency and effectiveness of customer interactions.

Final Thoughts on Call Center Outsourcing

Call center outsourcing is a powerful strategy for contractors in the HVAC, plumbing, electrical, and roofing industries. By carefully selecting the right provider, defining clear SLAs, and regularly monitoring performance, companies can achieve significant cost savings, increased efficiency, and enhanced customer service. The future of call center outsourcing is bright, with technology and data analytics playing an increasingly crucial role in shaping the landscape of modern customer interactions.

You may also be interested in: 10 Essential Call Center Customer Service Tips for 2024

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Outsourcing conservation in Africa

There’s an experiment going on in conservation in Africa. With biodiversity imperiled, and nations facing financial and political crises, some governments are transferring the management of protected areas to private, non-governmental organizations (NGOs).

This strategy seems to be paying off. NGOs can better manage corruption, making them attractive to large donors like the World Bank and European Union. Their capital can fund personnel, research and technology to more effectively manage protected areas and species. While these management changes appear to be working anecdotally, few if any studies have rigorously evaluated the results.

A team of researchers from institutions including UC Santa Barbara wanted to know how this trend affects wildlife and people. Surveying parks throughout the continent under private and government administration, they discovered that NGO management improves measures for wildlife, including by reducing elephant poaching, and increases tourism. Overall, management appears to improve under NGO control. However, they also discovered that in landscapes experiencing armed conflict, outsourcing park management also raises the risk of armed groups targeting civilians in and around protected areas. The team published their results in the  Proceedings of the National Academy of Sciences .

“Protected areas, and conservation generally, do not exist in isolation from humans,” said lead author  Sean Denny , a doctoral candidate at UC Santa Barbara’s Bren School of Environmental Science & Management. “In fact, conservation is, at its heart, about humans — it's about finding ways for humans and other species to coexist. This includes preventing extinctions caused by human activities like hunting and deforestation.” As a result, conservation often impacts people’s lives and livelihoods, outcomes that need to be taken into consideration.

African Parks as a case study

Denny and his two co-authors — Gabriel Englander, at the World Bank, and Patrick Hunnicutt, at the University of Oregon — focused on the organization African Parks (AP) as a case study. AP is the largest NGO partnering with governments in Africa to administer protected areas. The South Africa-based non-profit is given complete authority to manage, staff and fund the parks.

AP’s primary mission is to conserve and restore wildlife populations in Africa, but they also seek to make protected areas benefit people through tourism and development projects, like building schools and hospitals for local communities. Due to their focus on restoration, they sometimes work in areas experiencing armed conflict, where wildlife is especially prone to being over-hunted and faces extreme pressure from hunting. But protecting wildlife in these landscapes can require high levels of security and enforcement, which could have unintended impacts on people and result in tradeoffs between wildlife conservation and human well-being. The authors were interested in exploring these trade-offs; and, because AP operates in conflict zones, they suspected AP’s activities might capture them.

But running a study at such a large scale presented a challenge: The authors had to compare outcomes in areas under AP’s management to what would have happened if AP were never given the reins. To do so, they ran a quasi-experiment in which researchers make use of real-world events to create treatment and control groups. In real experiments, researchers randomly assign subjects to one of these groups to ensure that their findings are due to the treatment and not simply down to prior differences. But Denny and company didn’t have this luxury.

Fortunately, AP published a map of protected areas in Africa that they believe are key to safeguarding the continent’s biodiversity and ultimately meet their criteria for future management. These “anchor sites” share key characteristics like a large size, strong legal status, limited agricultural activity and the potential to sustain large wildlife populations. Twenty-two of these anchor sites are already managed by AP, but the rest are managed by governments and in very few cases, by other NGOs.

The research team formed a treatment group from anchor sites that AP already administers. Their control group consisted of anchor sites not managed by AP or another NGO. “African Parks essentially created our control group for us,” Denny said.

Deciding what to look for

The team used a variety of metrics to measure the effects of private management on wildlife and people. They needed metrics for which data was available at a continental scale. For wildlife, they focused on elephant poaching and bird abundances. On the human side, they looked at tourism, wealth and armed conflict. To measure these outcomes, they drew on diverse datasets and platforms, including a dataset called MIKE that monitors elephant poaching; the citizen science platforms eBird and iNaturalist; Atlas AI, which measures wealth; and the Armed Conflict Location & Event Data Project, which measures incidences of armed conflict.

The researchers also used the Management Effectiveness Tracking Tool (METT) to look under the hood at how AP affects management practices themselves. Developed by the International Union for Conservation of Nature, this standardized questionnaire quantifies how well protected areas are managed. It reports data on planning, financial resources, law enforcement and stakeholder involvement. The METT can shed light on the mechanisms behind the outcomes observed in the other datasets.

Following the results

Denny and his co-authors were impressed by the results private management had for wildlife. It reduced elephant poaching by 35%, and increased bird abundance by 37%. “African Parks really appears to work for wildlife,” Denny said. “The fact that they can reduce elephant poaching in protected areas that are threatened by armed groups is really quite extraordinary.” NGO administration also increased tourism, but the effects on wealth were less conclusive.

The authors also found some important drawbacks, though. In areas already experiencing armed conflict, these changes can increase the probability that armed groups target civilians living in areas bordering those overseen by AP. They think this could be a result of armed groups redirecting their activity toward exploiting civilians when AP prevents them from operating in or extracting resources from protected areas.

“While the outcomes for wildlife were even stronger than we expected,” Denny said, “we were concerned by the conflict results, especially when combined with the potential decrease in decision-making inclusiveness that comes with private management.”

Looking under the hood

The Management Effectiveness Tracking Tool provided insights on the mechanisms behind these outcomes. African Parks is a juggernaut compared to many cash-strapped national governments. Results from the METT revealed that AP increased capacity and resources (in terms of budget and staffing), as well as design and planning. “In some management criteria, they really do seem to manage more effectively,” Denny said.

The authors also found that monitoring and enforcement within parks rose under AP. The organization uses sophisticated equipment — like aircraft, drones and remote sensing — to monitor illegal activity in their parks and enforce wildlife protection. This likely contributes to the benefits of AP management for wildlife, as well as the rise in likelihood that armed groups target civilians.

Notably, only one of the four categories measured by the METT appeared to fall under private park management: decision-making inclusiveness. The slight drop in this category didn’t surprise Denny and his colleagues since AP maintains tight control over its work. It does, however, point to an opportunity for improvement.

Managing more effectively

African wildlife is threatened, and NGOs are offering a potential solution. But it’s crucial to investigate the impacts of private conservation management to understand its strengths, weaknesses and opportunities for improvement. Outsourcing conservation appears to provide a path for protecting wildlife, but the accompanying increased enforcement can lead to problems for people.

One way to ensure that protected areas work for people, according to the researchers, is to include local communities in stewardship. In Denny’s opinion, ethical conservation requires compensating local communities for the costs they bear and including them in policy decisions.

“If, in conflict regions, civilians are bearing some unexpected costs of private protected area management, then it is especially important that they are involved in decision making,” he said. Another avenue is to make sure that conservationists, park managers and governments monitor the impacts of private management, not just on wildlife but also on people, and adapt when necessary.

Additionally, many national parks in Africa were created by colonial administrations, so they have deep colonial histories and legacies. Denny and his co-authors are eager to partner with African researchers to explore how this history affects local people’s perceptions of parks, and their preferences for how they’re managed and by whom. “By elevating local voices, perspectives and experiences, we can develop more meaningful research and support management practices that benefit both wildlife and local communities,” he said.

African Parks’ map of anchor sites enabled the authors to compare private and governmental conservation management.

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4 case studies of businesses that scaled to greatness.

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Joe Camberato is the CEO and Founder of National Business Capital , a leading FinTech marketplace offering streamlined small business loans.

Have you ever wondered why some companies succeed in unimaginable ways while others fade into obscurity? The best way to understand how to scale a company is to look at how the most successful companies have done it. Let’s look at four companies that started out small and become global players in their industries.

Amazon is one of the best-known companies in the world, so it’s easy to forget that founder Jeff Bezos started the company out of his garage . In 1994, Bezos financed Amazon, which began as an online bookseller, with $10,000 of his own money.

Amazon experienced many losses during its early days, but its revenue quickly grew from $4.2 million to $8.5 million in 1996. The company went public in 1997, and the following year, it expanded beyond books.

One of its biggest game changers came in 2005 when the company launched Amazon Prime, its subscription service. There are 180 million Prime members in the U.S. alone.

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Amazon’s continued commitment to innovation has led it to be one of the world’s most successful companies. Amazon provides its customers with almost unparalleled convenience.

Under Armour

In 1996, Under Armour was founded with the idea of creating a T-shirt that wicks sweat away more efficiently and keeps athletes dry. The company started small , with founder Kevin Plank selling T-shirts out of the trunk of his car and to his former teammates on the University of Maryland’s football team.

Under Armour made several iterations of its original prototype, and the T-shirt was a huge success. The company began growing organically. Plank wanted to increase the company’s growth, so in 1999, he decided to take out an ESPN ad for $25,000 . It was a risky move at the time, and employees agreed to go without pay for a couple of weeks so the company could afford the ad. However, the risk paid off, and Under Armour generated $1 million in sales the next year and dramatically increased its brand recognition.

Under Armour’s initial funding came from Plank , but the company went public in 2005 . Under Armour began to diversify and release new products, but it never lost focus on its central mission—improving the performance and comfort of all athletes.

In 2007, Brian Chesky and Joe Gebbia couldn’t afford the rent for their San Francisco apartment, so they decided to rent out their loft space to earn some extra money. They didn’t want to post an ad on Craigslist , so they decided to create their own rental site.

In 2009, they were accepted into Y Combinator and received $20,000 in funding . Airbnb later received another $600,000 in funding in a seed round, despite receiving a lot of early resistance. By 2014, Airbnb had more than 550,000 properties listed worldwide and 10 million guests.

One of its keys to success is its focus on the user experience. By allowing people to rent out their homes, the company gives the average person a way to earn an additional stream of income.

In 1997, Netflix was started as a DVD rental service to help customers avoid getting hit with late fees. Customers selected the movies and TV shows they wanted online and could then have them delivered to their homes.

In 1999 , founder Reed Hastings introduced a subscription-based model. Once customers were locked into a monthly subscription, they were more likely to rent more movies. In 2000, Netflix released its Unlimited Movie Rental program, which allowed customers to rent an unlimited number of movies each month for a monthly subscription of $19.95.

In 2007, Netflix launched its online streaming service, and that was the first year the company surpassed $1 billion in revenue. The company later began entering into content licensing deals with television studios and, in 2011, started producing its own original programming.

Netflix has been a success because the company is flexible and able to adapt quickly to changes in the marketplace. And Netflix’s founders were able to see the long-term vision for what the company could become, unlike companies like Blockbuster.

Tips On Scaling Your Business

Scaling a business is the ultimate goal for most entrepreneurs, but how can you make it happen? First, it’s important to understand the difference between growth vs. scaling. Growing businesses focus on getting bigger and acquiring more customers and more team members. In comparison, scaling focuses on efficiency. Scalable companies can serve more customers without significantly more effort.

It’s near-impossible to scale a company by yourself, so you should ensure you have the right team in place. This isn’t just about bringing on more employees. It’s about finding those few, highly specialized employees who can help you move the company forward.

Research from McKinsey found that the highest performers are 800 times more productive than average employees in the same role. Focus on finding and keeping the right staff of people who believe in the company’s mission.

My company started with me. I worked as hard as I could and made some great progress in the beginning, but a business can only reach a certain level with only one person. It started with one hire, then two, then three. Before long, I was surrounded by amazingly talented people, and the business started to grow beyond what I was able to achieve on my own.

You also need to focus on understanding your customers and maintaining quality customer service. As companies start to scale, maintaining a high level of customer service becomes increasingly difficult. Ensure you’re meeting your customers’ needs by creating standard operating procedures, automating what you can and investing in 24/7 live chat.

Scaling your business requires investing in technology and systems, which aren’t cheap. Even if you don’t need the funds yet, start identifying potential banks or online lenders where you can access a loan or ongoing line of credit. Finding the right financing opportunities allows you to build the infrastructure necessary to scale.

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Shopify and the Problem of Shareholder “Approval” at Multi-Class Companies

Oren Lida is an Analyst and Dimitri Zagoroff is a Senior Editor at Glass, Lewis & Co. This post is based on their Glass Lewis memorandum.

Media reporting can make proxy season seem more dramatic than it is. While breathless coverage of board strife, impossibly high executive pay figures and shareholder activism at well-known companies is the norm, the overwhelming majority of director election and executive compensation proposals pass with majorities of 90% and upwards.

The handful of proposals that fail understandably draw headlines – yet many proposals opposed by a majority of shareholders fly under the radar. That’s because (with some  notable exceptions ) most reporting fails to acknowledge how multi-class share structures, which give certain shares typically held by founders and insiders more voting power than those held by institutional and retail investors, obscure investor sentiment.

Proxy voting is highly technical in and of itself, and its ultimate influence on how companies are run is even more complicated. So why does the impact of multi-class share structures matter? Because giving insiders and founders disproportionate voting power often serves to effectively silence ordinary shareholders, threatens the agency and objectivity of the board and removes a key safeguard against excessive pay, related party transactions, and other potential misuses of investor capital.

In this post, we look at how inequitable voting rights influenced 2024 AGM results at Shopify, and at the broader impact of multi-class share structures on the board and its role.

Case Study: Shopify Inc.

Two years ago, Shopify  controversially  implemented a “founder share” that gave CEO Tobi Lutke 40% voting rights indefinitely, even if his actual economic stake in the company goes down as low as ~2%. A majority of the company’s shares were voted against this arrangement – but because not all of the company’s shares had the same voting power, the founder share was nonetheless granted to Lutke.

At the 2024 AGM, Shopify’s now-cemented triple-class share structure again swung the vote on several proposals. Yet, as in 2022, most media coverage of the general meeting painted an incomplete picture of the results. A Financial Post headline on the day of the meeting  read  “Shopify shareholders approve executive pay plan they were urged to reject” while thelogic.co  reported  “Shopify shareholders approve executive pay plan, rejecting proxy push.” Shopify’s subsequent filings announced that all agenda items had been approved.

Like two years ago, the word “approve” is doing a lot of lifting.

According to S&P Capital IQ, institutional investors currently hold 815,336,783 shares in Shopify, or 63.3% of the economic exposure to the company’s share price performance. This translates into roughly 40% voting power, equivalent to that of the founder-CEO who only holds 6.2% of company’s total outstanding equity.

If the multi-class structure were collapsed and all shares voted on a one-to-one basis, the results indicate that well under half of shareholders supported the pay proposals, with support ranging from 34% for the option plan to 45% for the advisory say on pay. Meanwhile, we calculate that the re-election of director Gail Goodman would only have received 57% support.

Impact on the Board

Given that Gail Goodman chairs Shopify’s compensation committee, it’s likely that shareholder opposition to her re-election stemmed from the same concerns that prompted a majority of them to reject the company’s option plan, LTIP and Say on Pay. However, her re-election is notable in and of itself, if only because this outcome was all but assured. For so long as the founder share exists, the election of any Shopify director favored by the CEO is effectively guaranteed, thanks to the effective control that 40% of voting power represents in practice.

This calls attention to the paradox of ‘independent’ directors on multi-class company boards: though they theoretically represent the interests of all shareholders, in practice only the superior voter can remove them from the board. The  board contest  that unfolded at Rogers Communications in late 2021, and regressing standards of its board’s independence in the years since, serves as a case in point.

The same issues arise at controlled companies with a single share class — but in those cases, where one share equals one vote, the alignment of voting and economic power serves to (somewhat) align the controlling party’s interest with that of the company as a whole. By contrast, under a multi-class structure, voting control doesn’t require a commensurate level of economic exposure, exacerbating the potential for conflicts between the long-term health of the business and the best interests of the “controlling” party.

Impact on Pay

The impact of this imbalanced power structure on the effectiveness of directors is perhaps most clearly evident in the negotiation of executive pay packages. Independent boards, usually in the form of a compensation or human resources sub-committee, are effectively tasked with negotiating on behalf of the company and its owners opposite the CEO. The board is buying CEO services. It needs to make an offer that the desired executive will accept.

The compensation package typically comprises company cash, stock and perquisites – however, that’s not all that’s on offer. Beyond their financial remuneration, founders at companies like Shopify enjoy a special relationship with the business, a stature, and an employment arrangement, that they could likely not achieve anywhere else without dedicating years. Theoretically, this unique wad of organizational capital should put the board in a strong position when negotiating CEO services.

However, Shopify’s negotiations earlier this year resulted in a new 9-figure grant to the CEO, who already owns over 6% of the business. The compensation committee explained in its 2024 proxy circular that this new mega-grant serves “to empower Mr. Lütke to focus on driving sustained performance” and that the dollar value of the award was reached after “reviewing various factors, including the annual CEO pay level of our compensation comparator group.” In making the comparison, the committee does not appear to have even considered that Mr. Lütke enjoys a far more privileged position than many of the other CEOs in Shopify’s compensation peer group.

Paradoxically, the astronomical incentives offered at Shopify, as well as at other multi-class companies like GFL Environmental (where, after factoring out superior voting shares, the latest say on pay barely received majority support), imply an executive on the verge of being tempted away by better offers – or, more realistically, a captive board that has difficulty pushing back on the CEO or fully representing the interests of other shareholders.

This all raises a worthwhile question of what type of negotiation occurs between an independent compensation committee and a CEO who ultimately has the final say on those same directors’ re-election; a perk which could not be swiftly replicated at any competitor companies.

Impact on Transparency

It’s notable that we had to perform the above calculations to untangle vote results ourselves. Even proponents of multi-class share structures, like the Institute for Governance of Private and Public Organizations (“IGOPP”) in Canada (see “Policy Paper No. 11: The Case for Dual-Class of Shares”, 2019), call for companies to disclose a breakdown of their voting results so that shareholders can more easily isolate the effect of the superior voting shares. The failure to provide such disclosure indicates that companies see value in opacity, and that directors who effectively owe their seat to the grace of the CEO are not in a position to extract even modest concessions.

Aligning Risks & Rewards

At least some of the muffled shareholder opposition to Shopify’s compensation proposals likely reflected the significant level of economic dilution that (most) of the company’s investors are exposed to as a result of equity grants, with the long-term incentive plans allowing for the issuance of up to 31% of issued share capital. Thanks to the founder share, Lutke effectively hasn’t had to absorb the impact of these issuances, since his minimum 40% voting power cannot be reduced by the new equity. This illustrates how “one share one vote” isn’t just a matter of fairness. Equitable voting rights align interests by exposing different parties to the same externalities, supporting the mutual accountability that itself underlies the corporate governance triangle. When certain parties are artificially insulated from certain externalities, such as the dilution that results from new issuances, perverse outcomes can occur.

North American corporate boards are already more insulated than those in other developed capital markets when it comes to the freedom to set executive compensation; like at U.S. listed companies, Canadian say-on-pay proposals are retrospective and advisory. More often than not, the CEO serves as board chair. In spite of relatively weak safeguards, shareholders at companies with ordinary capital structures can – and occasionally do – act as a backstop by coalescing against what they perceive to be problematic governance or excessive pay practices.  However, as shown above, at multi-class companies their ability to do so is effectively curtailed.

The retort to one-share, one-vote proponents is often to say that shareholders vote with their feet and could divest if they are unhappy with such a company’s governance or performance. This ignores that many institutional investors and their fiduciaries are invested through passive funds and may therefore not have an active choice, so long as the index does not exclude multi-class companies.

Investors increasingly appear to be taking notice of multi-class share structures, and the need for transparent disclosure. Earlier this year, a proposal calling for Meta Platforms (whose founder maintains majority voting control despite owning less than 15% of the equity ) to provide a class-by-class breakdown of its voting results received 17% support – or roughly 45% on a one-to-one basis. Similar proposals have gone to a vote at Bombardier, CGI, Power Corporation of Canada and Alimentation Couche-Tard.

Of course, with company filings and press reporting often failing to acknowledge the existence of these structures, let alone their impact, it’s possible that some shareholders aren’t even aware of the issue.

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New Relic is named a Leader in the 2024 Gartner® Magic Quadrant™ for Observability Platforms for the 12th Consecutive Time

New relic has been named a leader in every report since 2012.

By Katrina Wong, Chief Marketing Officer

We are honored that New Relic has been named a Leader in the 2024 Gartner® Magic Quadrant™ for Observability Platforms . We are the only observability company to receive recognition as a Leader each time since 2012. This demonstrates our commitment to helping our customers like Domino’s , Mercado Libre , and Forbes Media stay consistently ahead in their respective markets.

Proliferation of monitoring tools is driving operational complexities

Businesses are facing growing technological and operational complexity due to the proliferation of specialized monitoring tools and distributed applications. This often leads to inefficiencies, miscommunication, and delayed responses to issues, negatively impacting customer experiences and revenue. We address these challenges with our unified observability platform, giving businesses a holistic view of their technology landscape and deep context for troubleshooting. We help businesses streamline their monitoring processes, quickly identify and address issues, and make data-driven decisions. This simplifies operations and enhances the ability to deliver consistent, high-quality customer experiences and drive innovation.

Innovating ahead of the market with OTel, AI, and DEM 

Innovation is at the core of our success. In the last few months, we have maintained our long track record of innovation by collaborating with NVIDIA to provide New Relic AI monitoring for applications built with NVIDIA NIM, launching the first integrated, AI-driven DEM solution and New Relic Pathpoint , and deepening our support for OpenTelemetry . These innovations provide businesses of all sizes the latest advancements needed to optimize the performance and reliability of digital applications. We are delivering on our mission of making observability accessible to every business with the industry’s only true consumption pricing and natural language querying and analytics powered by its in-platform generative AI assistant, New Relic AI . 

Recommended by 90% of customers as their platform of choice

We are one of the most-rated observability vendors by customers on the Gartner Peer Insights™ platform. We have an overall rating of 4.5 stars out of 5.0 based on 1389 verified customers, with 90% willingness to recommend the platform. A high percentage (63%) of verified reviewers rate New Relic 5.0 stars for observability. Our customers recognize us for our ability to:  

• Ensure system resilience and up to 100% uptime : “New Relic has been there for us through the ins and outs of sunsetting zabbix and the noise that it has brought, and replacing it with a holistic, data-driven observability and incident management policy, I cannot speak highly enough of how much they helped us along the road to a successful implementation, and it's led to quarters at 100% uptime so far!" — Staff Platform Engineer - Healthcare and Biotech
• Deliver superior customer experiences : “Our organization's observability journey centered in customer experience from zero to hero: New Relic as [a] vendor helped our company to establish true O11y." — Principal Software Engineer - Travel & Hospitality
• Provide deeper insights via single view of both apps and infrastructure : “New Relic provides a holistic solution that goes above just APM monitoring. It provides deep insights into the health, performance, and behavior of applications and infrastructure. As a user, I like how much I can get from one tool, and it reduces dependency on multiple tooling to get reporting and metrics. The APM feature provides real-time data and insights and helps us to track down bottlenecks and optimize code with the help of the granular data provided." — Sr Solution Architect - IT Services
• Maximize value with a flexible consumption model : “The evolution of their pricing model has been noteworthy, transitioning to a more flexible consumption-style approach, enabling us to pay for the precise services utilized. The implementation of New Relic surpassed our initial expectations, streamlining the execution of our observability project and accelerating our project timeline. A pivotal factor that significantly enriched our overall experience was the unwavering dedication and transparency demonstrated by our New Relic Senior Account Executives. Their tireless efforts in developing precise cost projections, facilitating conversations with subject matter experts, championing our cause during contract negotiations, and consistently maintaining open lines of communication showcased their commitment to our success.” — Senior Manager, Infrastructure Engineering - Hardware

Thank you to our customers and partners who trust New Relic to monitor, secure, and optimize their stack. We’re honored to be the sole vendor recognized as a Leader in the Magic Quadrant for observability platforms for 12 years running, and remain committed to eliminating disruptions to your digital enterprise so that your business can grow.

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Katrina is New Relic’s Chief Marketing Officer. She brings 20+ years of experience in marketing, go-to-market, and community development to New Relic.

Katrina is an AI-driven marketer with a passion for reaching developer communities. She has a proven track record for helping companies through stages of substantial growth and launching products in new markets. She has also created award-winning integrated campaigns with data storytelling. Katrina most recently served as Divisional CMO and VP Marketing at Twilio Segment. She has also held marketing and go-to-market leadership positions at Hired, Zuora, Salesforce, and SAP. She started her career as a management consultant for PricewaterhouseCoopers.

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The views expressed on this blog are those of the author and do not necessarily reflect the views of New Relic. Any solutions offered by the author are environment-specific and not part of the commercial solutions or support offered by New Relic. Please join us exclusively at the Explorers Hub ( discuss.newrelic.com ) for questions and support related to this blog post. This blog may contain links to content on third-party sites. By providing such links, New Relic does not adopt, guarantee, approve or endorse the information, views or products available on such sites.

Gartner, Magic Quadrant for Observability Platforms, Gregg Siegfried, Padraig Byrne, Mrudula Bangera, Matt Crossley, August 12, 2024.

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