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 Outsourcing

Definition;
job or process that could be performed
Outsourcing is any task, operation'
is instead contracted to a third party
by employees within an otg"tization' but
the functions that are performed
for a significant period of time' In addition'
Hiring'a temporary
i, *" inr.u p".ry "u' be performed on-site or off- site'
employee while yorlr secretary is on
maternity leave is not outsourcing'

Outsourcing is an arrangement in which

one company provides services for
usually have been provided in-house'
another company that could also be or
inlonnation techriology
Or,r"r*it* i, u t.".,4 that is becorring more common in
usually been regarded as intrinsic to
and other industries tbr-services that have
rnanaging a business.

Inbusiness,outsourcingisthecontractingoutofabusinessprocesstoathird-
the tum of
became popular in the United States near
party. The term "outsourcing"
translerring employees and
the 21st century. Outsourcing sometimes invoives
assets from one firrn to another, but not
always' .

well in rheir core competencies and

outsourcing is said to help frrms to.perfonn
areas where they want to outsource'
firitigate ,ho.tug" of skill or expertise in the
Outs"ourcing can offer greater budget
flexibiliry and control' Outsourc ing lets
need' when they need them'
organizations pay tor o"tl tn" '""itJ' they

non
' ComPantes outsource a\'lll cer-tain-typis' ol costs' They outsou(ce the:
to ar,,rcid
the reasons ao*puni., elect to outsource' include
the-
core activities. An-lPng
energy costs' atld costs associated with
ar,oidance of regulations,- high taxes' \$h
 dlehned benefiti in labo*union contracts and taxes for govem^ment-mandatdd

pompanies'may seek inter{ra.l savings io focus money and iesources towards core
, bllsiness. A compan) may outsour:ce .its..lan{scapi4g- fuirctionS ineJgvant lo the corb -.:
'
b'usiniss.iomphnies ind certaiir speiialized
'.. fuhctions, such as PaYroll, firrd the same level- of
consumer satisfaction-

Recommendation bY the Pentascope International in the'

. context of Nelal Telecom

'
Tlre Govemment of Nepal had appointed consultant M/s Pentascopg

International for Commercialization and Restructuring of Nefal Telecom as

part of the govemment's Telecommunications Sector Reform lroject in July
2005.

The. foilowing areas that do not belong to NEPAL TELECOM's core

business activities were recommended by the consultant to be outsOurced:-

' Gardening, cleaning and securitY

' Vehicles and drivers
. Civil works
. Revenue collection and salary payment
t lnqutry servlces
i Secondary cable network installation
 Targets
A target is a result that you are trying to achieve. It is a desired goal in which you \t'ant
to be met in a certain time frame. Targets are high\, specific items that work like
lighthouses on a bay. They help employees to make day to day decisions. They are
sometimes expressed in non-finincial terms. Management expects targets to be met in
order.for goals to be achieved. How flexible they are depends on the management style.
-"Target Market-s" are special- The company develops products or services with the needs-
or wants of a target maiket in mind. Advertising is also geared toward target markets.

. How to set a business targets?

Whether you set them as a personal goal or as a performance evaluation matrix or the
guiding force in a strategic plan, business targets are an important part of growing your
business. Working without concrete, defined targets has been likened to traveltring
without a map. You might.make progress, but its.difficult to knorv what way to move.
With goals, you have a guideline for decisiori ranging from technical actions plans to
i our daill' to-do list.
Instructions
r. pick one aspect of your business where you want gronth. It's best to set business
targets one at a time rather than trying to set them all together.

z. pick the metrics you want to use when you measure progress towards your business
targets. Income couldl be measured by gross sales, net income or growth percentage.
Personnel target could be measured by employee turnover or an abstract measure of
employee morale.

3. Use the information you gathered earlier to determine what your average growth has
,been in recent years. Analyze the data to see if seasonal fluctuations in the metric will
have any effect.

4. pick a realistic improvement rate based on pasi performance and any .new
information or initiatives. A realistic. rate of growth itill depend on many factors
including the economy, your pArticular industry and competition in l our area. -
.5. select a set time by which you want to meet the business target r.ou have set.

6: establish benchmarks. b}, subdividing the goal and timeline. eg. If 1'ou wanted to
increase sales 3o7o .in'-6 months, you-could set b'enchmarks of:5 o,6" everv monih.
Benchmarks give you gpportunities to assess prgjress so ygu can nrake changes you
.. .need i\brder to mggtr your targets- sucgessful!1.. . a: .: i . , ' ; :..
' StratdS:' :
' The terni srrategv is de rived:fro m'greek rnord. itragegia' rthich \\'as used fcif geneialship
of Ieading an irml'. In organizatior.rs, it is decided bl the board of directors.
 A strategy will lay out how the business r,r,ill achieve its objectives. Once.the business
establishes a strategyr the busin6ss should answer severai. questions. Thesg questions
include what will thetbusiness doi ho*, who can help do it and when. Answering these
.questions can provide the business with a clear indieation of the ability that the business
has tb achievaitS objectives.

"strategr is the dirqctlon hnd scope of an organization qver the long-term; which
achibves advantage.for the oiganiZation through its co3figuration of resources within a
'challenging
environment, .to . meet the needS of market 'to fulfill stak-eholder
expectations".'

Johnson and Scholes . -

In other words, strategy is about:

I *Wh;.;i; ihe businels trying to get to in the long-term (direction)

.'.- ..'','' .'''. .. -. , ^. ... ':
* Which markets should a business cbmpete in and what kind of activities are involved
in such markets?.(mArkets; scope)

,- go* ian tfre 6u.i.r"". pe.foi- fetter tfran the competition in those markets? .

(advantage)?

* What resources (skills, assets, finance, relationships, technical competence,

facilities) .

are required in order tobe able to compete? (resources)?

ll
- wh;i;*ie ;,"r,rrlion*"nt"t factors affect the businesses' ability to compete? .' i

, (environrlrent)?

* What ire the valuestand expectations ofthose who have power in and
around thi I

bqsiness? (stakeholders)
I

"strategy is aboui shapingthefuture"-Max M'cKeown.

So strategy is a pattern on a stream.of decisions to contrast wilh a view of s-trategy

asplanning. So it is a plan of action resulting from strategy or intended to accomplish a
specific goal. It helps to bring about a desired future, such as achievement of a goal or
solution to a problem. An organization needs to implement effective stratesi te

.t

+, + 'i .i. .l r
:rlr*.? }'}T'TT T T

meet its objectives. These objectives should relate to the businessas a whole because the
participation. of the whole organization helps ensure success. A strategy will also have a
better chance of succeeding if it is targeted. A target stratery addresses the specific
needs of the consumer most likely to need the product or service.

Businesses use three levels -of strategies in the planning process to help-them grow and
''become sustainable, three levels are:

Corporate level strates/:

' This Ievel answers thb foundational question of what you want to achieve. ts it growth,
stability, or ietrenchrrient? It is conperned with the overall'purpose and scope of the
business to meet stakeholder expectations.

Business unit level si.ai.gy,

This level focuses on how you're going to compete. will it be through customer intimacy,
product or service leader-ship, or lowest total cost? what's the differentiation based oni

Market level strates/:

This strategr le'el focuses on how you're going to grow. Will it be through market
penetration, market development, product or service development, or diversification? It
is concerned more with how a business competes successfully in a particular market. [t
concerns 'strategic decisions about choice of products, meeting needs of cuitomers,
gaining advantage ovdr competitors, exploiting or creating new opportunities etc.