COMPANIES are increasingly opting to outsource key business functions in order to save on costs, increase productivity levels and add value to their business.
The latest edition of the annual outsourcing survey report from accountancy giant Mazars shows that just under 40% of Irish firms are currently outsourcing at least one ingredient of their business activity and that 80% of those currently doing so have either maintained or increased their use of outsourcing in the past year.
"Outsourcing is becoming an increasingly popular means for ‘Ireland Inc’ to manage and in fact reduce operational costs," said Mazars Ireland partner Dera McLoughlin.
"It’s interesting to note that, of the organisations that outsource activities, most need these services to run their business regardless of how the economy is performing.
"This suggests that a reliance on high-quality outsourcing services is actually quite common in Ireland — across all business sectors," she added.
The majority of functions being outsourced centre on finance, payroll and accounting needs, but IT and web services are also being outsourced at a growing rate.
The survey also found that financial services companies and those within the public sector are most likely to outsource activities.
The main reasons for outsourcing given by those companies taking part in the survey included adding value to a business, enhancing efficiency and quality within the company, reducing costs and accessing those skills that are not currently readily available within the company.
Interestingly, according to Mazars, two thirds of those companies surveyed said that the ongoing economic downturn wouldn’t be reason enough for them to change their outsourcing practices over the coming 12 months.
Overall, 54% of organisations reported making cost savings and of those, 75% indicated that outsourcing yielded cost reductions, the new report added.
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This appeared in the printed version of the Irish Examiner Saturday, March 13, 2010
