define outsourcing?

Hi Anirban,

Outsourcing refers to a system of hiring business services from the outside world, which were previously provided internally or from within the country. Today, organisations increasingly hire services such as legal services, music recording, book transcriptions, IT, security, teaching etc. from the foreign countries. Generally services are outsourced by the companies in developed countries to developing or underdeveloped countries.With the fast growing modes of communication, outsourcing is strengthening day by day. Nowadays, India is emerging as a favourite destination of outsourcing industries. This is because of the fact that  wage rates commanded by the labour in India are much lower as compared to that commanded by the labour having equal level of qualification in the developed countries. Also, Indians have fairly reasonable degree of skills and techniques. Hence, they need low training period and, thus, low cost of training. Outsourcing of services benefits not just the developed countries but also, the developing countries to which the services are outsourced. These benefits are in the form of better employment opportunities, increased flow of investment, etc.

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