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Chapter 2. Spotting e-Business Trends > Organizational Trends

Organizational Trends

Outsourcing Management: Flatten the Organization

The modern business climate demands that companies live and breathe flexibility in order to survive. Such flexibility is often reflected in a firm's decision to outsource specific business processes. Business process outsourcing (BPO) is the delegation of one or more business processes to an external provider to improve overall business performance in a particular area. For example, utility companies are outsourcing their cost centers (human resources and purchasing functions) in order to concentrate on their core competence: making and selling energy.

BPO offers businesses innovative ways to save money and to enter or create new markets rapidly, without a significant up-front investment. BPO provides a modular environment in which it is possible to scale up and ramp down, depending on seasonal cycles and production needs. The market trends driving the adoption of BPO strategies include pressure to increase earnings and reduce costs and an increased need to create and maintain a competitive edge.


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