Question

Why do MNC's outsource their production programmes?

Answer 1

Companies choose to outsource or offshore so that they may continue focusing on their core business processes while delegating mundane time consuming processes to external agenciesOutsourcing and offshoring also enable companies to tap in to and leverage a global knowledge base, having access to world class capabilitiesFreeing up internal resources that could be put in to effective use for other purposes is also one of the primary benefits realized when companies outsource or offshoreMany times stranded with internal resource crunches, many world class enterprises outsource to gain access to resources not available internallyOutsourcing, many a time is undertaken to save costs and provide a buffer capital fund to companies that could be leveraged in a manner that best profits the companyBy delegating responsibilities to external agencies companies can wash their hands off functions that are difficult to manage and control while still realizing their benefitsOutsourcing and especially offshoring helps companies mitigate risk and is also among the primary reasons embarked uponOutsourcing also enables companies to realize the benefits of re-engineeringSome companies also outsource to help them expand and gain access to new market areas, by taking the point of production or service delivery closer to their end users