In business, outsourcing involves the contracting out of a business process to another party (compare business process outsourcing). The concept "outsourcing" came from American Glossary 'outside resourcing' and it dates back to at least 1981. Outsourcing sometimes involves transferring employees and assets from one firm to another, but not always. Outsourcing is also the practice of handing over control of public services to for-profit corporations.
Outsourcing can also be viewed as any assistance from an intermediary that is more capable of or familiar with certain practices than us.[who?] It is just a way of seeking for assistance.
Outsourcing includes both foreign and domestic contracting, and sometimes includes offshoring (relocating a business function to another country). Financial savings from lower international labor rates can provide a major motivation for outsourcing or offshoring.
The opposite of outsourcing, insourcing, entails bringing processes handled by third-party firms in-house, and is sometimes accomplished via vertical integration. However, a business can provide a contract service to another business without necessarily insourcing that business process.
Outsourcing is a very important tool for reducing cost and improving quality. If an organization does one or all its work by itself, its work may affect its production quality. So, an organization must recognize some important areas where it can reduce its costs and maintain high quality in its products and/or services.