Outbreeding

Outbreeding: advantages and disadvantages of external outsourcing strategy

Outbreeding, or external outsourcing, is a strategy in which a company hires external suppliers to perform certain tasks instead of performing them internally. This strategy can be applied to various types of businesses, including manufacturing, marketing, information technology and more.

One of the main benefits of outbreeding is the reduction in production or task costs. A company can hire specialized experts who can complete a task more efficiently than company employees, thereby saving on costs and increasing the profitability of the business.

Additionally, outbreeding can help a company focus on its core competencies and increase productivity. Performing tasks unrelated to the company's core business can distract employees from more important tasks, which may not be effective for the business as a whole.

However, in addition to the advantages, outbreeding also has its disadvantages. For example, a company loses control over a production process or task execution, which may result in lower quality products or services. Additionally, external suppliers may not have the same understanding of the business as company employees, which can lead to difficulties in communication and alignment.

You should also consider the risks associated with confidentiality of information. With outbreeding, a company may share sensitive information with outside vendors that could be stolen or misused.

Overall, outbreeding can be an effective strategy for companies that want to reduce costs, increase productivity, and focus on their core competencies. However, companies should carefully evaluate all the risks and benefits before deciding to outsource.