Interestingly, the 2009 Nobel Prize in economics has very practical implications for the growing business process outsourcing field.  Nobel Prize winners Oliver Williamson and Elinor Ostrom have provided great insight for a variety of issues in the modern workforce, including business process outsourcing.  Here are several ways in which the work of these two economic gurus has shed great light on the unique power of outsourcing.

Sharing Resources

One important aspect of the Nobel Prize winners’ work is that the sharing of resources leads to better management on a large scale.  This idea is applicable to business process outsourcing because it encourages companies to look toward models that do not rely on centralized governance.  Spreading responsibilities around to a variety of groups is essentially a more effective way to utilize valuable resources that may not be available in the area surrounding primary business infrastructure.  This speaks to the power of outsourcing work to an offshore location, such as the Philippines, where business process outsourcing is a rapidly growing industry.

A Broad Talent Pool

Another example of the power of outsourcing comes from the fact that partners overseas can tap into the skills and knowledge of a diverse and broad talent pool.  This eliminates the need for companies to execute targeted recruiting campaigns and reduces the cost of overhead associated with HR and training.

For example, a team of IT specialists in the Philippines can manage the networking and technical support needs of a large firm in the United States for a fraction of the cost.  In contrast, the domestic firm would have needed to invest a great deal of time and money finding the right domestic individual(s) to add to their team, if not for the broad talent pool found within outsourcing companies in the Philippines.

Costs and Benefits

A key element in the Nobel Prize winners’ work also analyzed how companies weigh the costs and benefits associated with business process outsourcing.  Clearly, there are instances when outsourcing is not an effective solution for a company.  However, more often than not, there are options available to businesses that can enhance productivity and ultimately save time and money in the long run.

The recent Nobel Prize in economics awarded to Oliver Williamson and Elinor Olstrom is evidence of the growing possibilities in the business process outsourcing field.  Relationships between businesses and outsourcing partners will continue to drive success in modern management.  Indeed, the economy and modern business will become more dependent on the success of business process outsourcing relationships.