Business premises and organizations have always preferred to use their own personnel and resources whereby they purchase or produce their needs such as of goods and services from the domestic environment so as to have ultimate control in the overall business activities as opposed to where business premises and companies have to focus on major value adding activities and therefore procure goods and services that are not main to their production, from the outside suppliers. The success of every company depends on its ability to react to future changes a little bit sooner than competitors and the first step to focus company’s operations to human factors and its core business activities and processes and refrain from monitoring operational details and additional operational activities is through outsourcing practices (Potkány 53). Firms and corporations face numerous challenges in choosing modes of outsourcing and the contractors to provide the services therefore there is urgent need to realize the best practices and services to apply as specific businesses in order to focus on their major activities in the event of reducing their operational costs and improving their contest in the business field (Liou and Chuang 1). Not all activities and processes in an organization can be outsourced from external contractors since there are number of factors such as quality, lead time deliveries and activity level of importance that have to be considered.

Most organizations and businesses aim at value, profit and wealth maximization which is often not the case where there are huge costs incurred such that it exceeds the revenue reaped from the business operations. The costs of operation have substantial effect on the final price of the product, which in turn affects the profit portfolio of business as proved by the predatory pricing doctrine where a firm raises the operational costs of a competing firm so as to gradually reduce their revenue, keeping them out of market (Salop 267). Organizations are therefore liable to work towards the reduction of operational costs by outsourcing of goods, activities and processes that are provided by the outside contractors at a relatively lower costs than it would be if it was made inhouse. Reduction of operational costs is one of the key reasons why organizations outsource resources such as IT services, as most of the external vendors have production cost advantages hence providing these services at lower prices (Han 315).

Businesses are mandated with the role of ensuring that the products they deliver conform with the specifications and they perform the purpose for which they are meant for. In some instances, businesses are incapable of providing the best value and quality hence they are forced to conduct professional outsourcing of competent and experienced personnel to provide the necessary knowledge and application that would ensure conformity. Business entities are faced with management problems within their facilities such as in procurement, financial, accounting, poor resources allocations and poor customer services, these entities therefore purchase these resources from external contractor to help provide the services at best quality that could not be provided by the contracting entity (Lok et al. 1). In a recent study to establish the new forms of organizing and professional identity, we find a conclusion that outsourcing of professional services brings about rise of elasticity delivery of service; as more focus is given to the output as the outsourced service gives more quality than would have been the case if provided inhouse (Veenswijk 18)

Having the right time management in a business enables entity to be focused on prioritization of their activities and ensure the delivery of the right products at the right time to the consumers. Businesses may not be able to keep up with the consumers lead time delivery expectations if they spend much time on the non-core business activities, in order to save on time, they resolve to procuring of these resources from the external suppliers who can provide these services within the provided time limit as the entity concentrate on their main activities. Businesses allocate much of its time on indispensable activities and processes to improve overall performance and least time is focused on other activities that have been mandated on outside contractors (Maku and Ivaro 8)

Before organizations decide to outsource services, they should conduct due diligence and consider all the necessary factors such as; separation of their core activities from other activities, comparison of the costs involved in outsourcing versus in inhouse production, comparison of the lead time delivery and the quality achieved.