Outsourcing: The Upcoming Strategic Option

It is important at first to have some way of defining (outsourcing), given that it is an in-ordinary word which has no pervasive linguistic use in Arabic. However, it in fact has a magnificent and innovative definition which semantically indicates what the concept stands for when used.

Outsourcing

It is much easier to approach the meaning of (Outsourcing) in Arabic by using the semantic translation of the word (subcontracting).

However, the word in Arabic (Ta’heed / tæȧhid) is an accurate translation for the English Term (outsourcing).

We could easily put it out clearly in the following definition:

“Outsourcing is a process resorted to by institutions when they have to subcontract, a competent party or a personal to replace or represent them in carrying out some of the work”

Outsourcing may also be defined as:

“The company’s hiring or using of specialty competencies, personals, means or services of another party (either domestic or foreign companies), and (either in state or out state) in order to reduce costs and save effort and time, whereas the party which is outsourced is confided and authorized to do whatever necessary for the work to be done in return of remuneration”

The question which is confounding everyone is; “Why the companies resort to outsourcing?”

It is known to be a fact to us all that companies only seek profit via enhancing services and saving money and time, and yet, the aforementioned elements are the most crucial for every company outsourcing its services or functions.

Moreover, the risk in outsourcing is minimal for the companies doing it as the company originating the service (the outsourcing or temporary recruitment services on demand) is the one undertaking the providence of such service, standard and whatever remarks arise about it.

Also outsourcing allows companies to pertain a simple management structure specialized and apart from crowding management staff, which facilitates the possibility to overcome any economic recession that can lead to regression of demanding the service. It can help the company to easily deal with any increase of demanding the services, as it is required either ways to increase or diminish the contract with the outsourcing company. All the above is inevitable to enable any company to compete the market and accomplish more of the business.

The following are the benefits from outsourcing, simply outlined for our reader to perceive:

  • Enhancing the service
  • Reducing costs
  • Saving time
  • Reinforcing the capacity to compete and diminish the risks

It is very important, of course to indicate that it started initially when American and British companies outsourced companies in India to carry out some high expenses services and this service started in fields such as (software and communicative centers).

Frost & Sullivan emphasized that the size of outsourcing in Middle East and North Africa (MENA) will reach $2.69 million, which is a big amount of money that several of the outsourcing and temporary appointment companies intend to benefit from it.

It is crucial to emphasize that the success of outsourcing is related to the company’s ability to manage the contract and obtain the maximum advantage of it making sure that it gained all benefits of outsourcing and success also depends on the ability of the outsourcing company to provide excellent standard of the service leading to fulfill the client’s desires and the outsourcing companies desires” both depending on clear understanding of the contract between them.

Some highlight of the risks arise from outsourcing and I hereby think that the most fundamental and significant risks of outsourcing are:

  • Failure of the company to execute requirements such as supply of services or staff in such field, which can be overcome by valid selection of the competent companies which are authorized legally in the above field provided that it shall possess both financial and technical capacity to manage its assigned works. It shall also be taken into consideration the importance of maintaining a certified experience record at the company to indicate its capacity and experience.

It is common in the area that Dubai in the United Arab of Emirates has hastened in years to lift up those important works such as (Dubai Outsource City) in addition to the availability of special licenses (the temporary recruitment services) to the companies concerned with this important and vital field.

Now, the government of UAE, headed by Prime Minister, His Highness Sheikh Mohammad bin Rashid, Vice President, Prime Minister and Ruler of Dubai is widely concerned about outsourcing. As after consulting his brother, His Highness, Sheikh Mohammed bin Zayed, the Crown Prince of Abu Dhabi,  Deputy Supreme Commander of the  Armed Forces and the Chairman of the Abu Dhabi Executive Council,  who, God Bless him, emphasized the approval of detailed structure of the Federal Government in UAE to appoint the Ministers of this Cabinet to strategic and regulatory role while the state shall adopt a road map for outsourcing most of the governmental services to the private sector.

This strategic trend binds the functioning companies in the business of more responsibility as UAE cannot accept semi completed services or semi solutions, thereby, all outsourcing companies shall upgrade themselves to the next challenging standard for all to be “Number One”, quoting His Highness, Sheikh Mohammad bin Rashid, God bless him, (our country’s objective is to be in the first position) (I and my people will not settle for any less than first place) (I and my people love the first position).

It is very important to address the companies intending to be or already working in the outsourcing business that in UAE, there is no place for any less than perfect services which ultimate goal is to put our customer in the first place and only in the first place.

Eventually, I would like to say that after being a strategic option for companies willing to succeed and compete, outsourcing has now become a strategic option for governments. This is evidence to how successful and significant outsourcing can be.

 

Maher Hussain, Executive Manager,

Reach Employment Services – Dubai

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