Different industries have different reasons for outsourcing; however there are those factors that are common across all industries. An outsourcing survey conducted in 2003 by the CIO Insight magazine cites various reasons as key drivers for outsourcing (Brownell, Jegen & Krishnamurthy, 2003, p.19-29). First, alleviate worker shortage as often a firm may have a shortage of workers to perform a certain task. This is mostly the case with call centers, thus there is need to outsource employees who will work at call centers, on behalf of the firm.
Second, cost reduction as it is considered one of the major benefits to a firm derived from outsourcing. The domestic market may prove too expensive and inconvenient as compared to outsource same service from other firms so as to lower operating costs. Third, outsourcing enhances better use of in house resources in the sense that a firm can use the resources at its disposal more efficiently and effectively by outsourcing its services. The firm might opt to outsource its payroll services so that workers, who would have worked on the payroll services, can be put to work creating the next growth plan for the firm.
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