Understanding Outsourcing Models

Aug 2, 2023

The impact of technology is seen everywhere all throughout the world. It is amazing to see how it has affected businesses, making their work easy in countless ways. Due to technology, communication has also become faster and easy, enabling many businesses to expand their work scope outside their country and allowing them to incorporate outsourcing within their company. Outsourcing is the business practice of sending specific workloads to a third-party company that will perform services that were previously provided in-house by the company’s own employees and staff.

Due to today’s dynamic and competitive market, many companies face overwhelming workloads that can have a negative effect on their resources and thus can hinder efficiency. Through outsourcing, companies team up with outside experts and can offload non-core tasks to them, allowing the internal team to concentrate on the priority projects. Outsourcing can be grouped into two kinds of models: location-based and relationship-based.

Location-based outsourcing models

Outsourcing can be done in three ways: on-shore, off-shore and nearshore.

  • Nearshore is when you outsource to the same country or to a country that is within close geographic proximity and in the same time zone. Offshore outsourcing is sending work to another country worldwide with a lower labour cost. It can be done by people in different time zones. Lastly, onshore outsourcing is when you outsource in a different country but still within the same region.
Outsourcing Models

Outsourcing Models

Relationship-based outsourcing models

Apart from location-based models, outsourcing can also be divided into three relationship-based models: project-based, staff augmentation and dedicated development teams.

Project-based model – your third-party provider will carry out the entire project. You’ll contact project managers, who will form the team that will be working on the project. This model will save you costs, and it will cover the full-cycle development of the project.

Dedicated development team model – the vendor provides you with a dedicated team who will be working on your project. This model is suitable for longer projects and not for shorter ones.

Staff augmentation – you’ll be provided with remote professionals whom you can manage directly. This outsourcing model will offer you flexibility and it’s suitable for both long- and short-term projects.

Choosing the right outsourcing model

Deciding on the outsourcing model that will be beneficial to your company’s needs can be frustrating. Of all the models mentioned above, it doesn’t mean that you should only choose one and stick to that. You can be flexible and work on two or more models at the same time, even if you’re collaborating with one service provider. But, before choosing the outsourcing model(s), you should first consider the following factors:

  • Your scope of work
  • The project’s estimated duration
  • The project management methodology you prefer and
  • The level of technical innovation in the project.
Outsource with GSI Associates

GSI Associates is a British-based company that offers outsourcing services in the heart of Europe. With more than 15 years of experience, GSI Outsourcing provides high-quality staff, processes, service quality and HR systems. Equally important to GSI is being flexible and emphatic to clients’ needs and requirements in order to achieve satisfactory results for both parties. GSI provides outsourcing services for a range of departments, including IT, finance and accounting, graphic design, and administrative business support. If you need outsourcing services, then GSI is here to meet your needs! Make sure to contact us at:

🌐 www.gsioutsourcing.com
📞 +44 (0)20 3151 6848
📧 [email protected]


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