Service Outsourcing refers to the economic activity in which an enterprise divests itself of the IT business and IT-based business processes that were originally provided by the enterprise itself with the basic, ****, non-core IT business and outsources them to the enterprise's external professional service providers to complete. Therefore, service outsourcing should be based on information network technology, its service work (including business and business processes) through computer operations to complete, and the use of modern means of communication for delivery, so that enterprises through the restructuring of the value chain, optimize the allocation of resources, reduce costs and enhance the core competitiveness of enterprises.
1.Definition of Service Outsourcing by the Chinese Government Network
1.1 Information Technology Outsourcing (ITO)
1.1.1 Software R&D & Outsourcing
Category Scope of Application
Software R&D &
Development Services Used in Finance, Government, Education, Manufacturing, Retail, Services, Energy, Logistics and Transportation, Media, telecommunication, public **** utilities and health care industries, for the user's operations/production/supply chain/customer relations/human resources and financial management, computer-aided design/engineering and other business software development, customized software development, embedded software, suite of software development, system software development software testing, etc.
Software technical services Software consulting, maintenance, training, testing, etc. Technical Services
1.1.2 Outsourcing of Information Technology R&D Services
Category Scope of Application
Integrated Circuit (IC) Design Integrated Circuit (IC) product design and related technical support services, etc.
Provision of E-Commerce Platforms Provision of information platforms for e-trade services, etc.
Testing Platforms Provision of testing platforms for the development and application of software and integrated circuits. Platforms
1.1.3 Outsourcing of Information System Operation and Maintenance
Category Scope of Application
Information System Operation
Information System Operation
And Maintenance Services Services Internal information system integration, network management, desktop management and maintenance services for customers; information engineering, geographic information systems, remote maintenance and other information system application services
Basic Information
Basic information technology services such as basic information technology management platform integration (IT infrastructure management, data center, hosting center, security services, communication services, etc.)
1.2 Technical Business Process Outsourcing (BPO)
Category Scope of application
Enterprise business process
Design services Provide internal management, business operation and other process design services for customer enterprises. management, business operation and other process design services
Internal management
Database services Provide data analysis, data mining, data management, data use services for back-office management, human resources management, finance, audit and tax management, financial payment services, medical data and other internal management services for client companies; undertake client's professional data processing, analysis and integration services. Services
Enterprise Operations
Database Services Provide technical research and development services for customer enterprises, application customer analysis, database management and other services for enterprise operation, sales, and after-sales service of products. It mainly includes financial services business, government and education business, manufacturing business and life sciences, retail and wholesale and transportation business, health care business, communication and public **** business business, call centers, etc.
Enterprise Supply Chain Management Database Services Provide customers with the overall program design and database services for procurement and logistics
1.3 Technical Knowledge Process Outsourcing (KPO)
Scope of application
Intellectual property research, pharmaceutical and biotechnology R&D and testing, product technology R&D, industrial design, analytics and data mining, animation and online game design and R&D, educational courseware R&D, engineering design and other fields
2.2 Why do developed countries outsource their services?
1. It is the key to competition from general technology to core technology. Enterprises outsource the production of general technology and services to develop core technology in order to maximize the competitiveness of enterprises.
2. It is the geographical shift of competition from regional to global. Enterprises must utilize foreign resources to maintain and expand their share in the global market, and service outsourcing becomes an effective mode.
3. It is the rapid development of information technology, for service outsourcing provides a technical basis. Information technology, especially the development of network technology, so that service outsourcing from the possibility of becoming a reality.
4. It is the impulse to minimize the cost and maximize the profit of the enterprise provides a strong impetus for service outsourcing. In terms of short-term benefits, service outsourcing companies can save 20%-40% of the operating costs. Southern Jiangsu region has entered the late stage of industrialization, in the resources, environmental pressure constraints, low-end manufacturing has been unsustainable, must be in the development of high-end, modern, advanced manufacturing at the same time, the simultaneous development of high-end, modern, advanced services, to achieve the "dual-wheel drive", interactive development.
Three, the economic role of the service outsourcing industry
The development of service outsourcing is conducive to enhancing the technical level of the service industry, the level of service, and promote the internationalization of the service industry and exports, so as to promote the development of modern service industry. Its specific role in the economy is manifested as follows:
1. It is conducive to upgrading the industrial structure. Undertake outsourcing services, can increase the proportion of service industry in GDP, enhance the industrial structure, save energy consumption, reduce environmental pollution. Service outsourcing industry is an important part of the modern high-end service industry, with a high degree of information technology, value-added, low resource consumption and other characteristics. Undertaking service outsourcing has an important role in promoting the development of the service industry and industrial structure adjustment, and can create conditions to promote the upgrading of the manufacturing-based economy to a service economy, and promote the growth mode to intensive development.
2. It is conducive to changing the mode of growth of foreign trade and forming a new export support point. Undertake outsourcing services, can expand the export income of service trade. In recent years China's foreign trade exports in the steady development, but also encountered many problems. Such as the adjustment of export tax rebate policy, foreign trade restrictions continue to strengthen, increasing trade friction, the RMB exchange rate continues to increase, to maintain sustained rapid growth has become increasingly difficult. And the development of service outsourcing, because of its lower dependence on resource costs, foreign restrictions are not strong, with the room for rapid growth, which is expected to become a new growth engine for exports.
3, conducive to improving the level of foreign investment, optimize the structure of foreign investment. China's manufacturing industry to utilize foreign capital has a history of more than 20 years, made great progress. With the continuous development of the economy, each city will face or has faced the real problem of shortage of energy resources and limited land capacity. According to the relevant information disclosure, in the country's 15 sub-provincial cities there have been a lot of foreign investment in the second sector of the project through the approval of the project but it is difficult to settle, even in the third sector, due to the country's restrictions on real estate projects, the future will also face difficulties. And service outsourcing project because of the land resources requirements are not high, once the foreign investment intention, the probability of settlement will be much higher than the second project. China's next round of opening up to the outside world is the focus of the service industry, the international transfer of the service industry is mainly through the service outsourcing to achieve, undertake service outsourcing industry, you will be able to achieve the gradual transfer of the international advanced service industry, so as to optimize the structure of the use of foreign investment, more suitable for the harmonious development of the city's economy.
4, conducive to improving the employment rate of college students. since the 1980s, the service industry to absorb the labor force employment accounted for the proportion of the social labor force increased year by year, and service outsourcing as a modern service industry promoter, will create a large number of jobs, to alleviate the intellectuals, especially college students, the employment pressure. It is predicted that by 2010, offshore service outsourcing can create about 1 million direct and 3 million indirect stable and high-quality employment opportunities in China. IT services and IT-related services are typical high-income industries compared with other manufacturing industries. At the same time, it will also drive the government, universities and enterprises to strengthen the training of talents, improve the quality of labor force, and cultivate a group of talents who are proficient in English, master the world's cutting-edge technology, and have extensive connections with overseas markets.
IV. Classification and Content of Service Outsourcing
Information Technology Outsourcing (ITO) and Business Process Outsourcing (BPO)
Information Technology Outsourcing (ITO)
System operation services: banking data, credit card data, all kinds of insurance data, insurance claims data, medical/physical checkups data, tax data, and legal data (including information) Processing and Integration
System Application Services: Information Engineering and Process Design, Management Information System Services, Remote Maintenance, etc.
Basic Technology Services: Undertake Technology Research and Development, Software Development and Design, Integration of Basis Technology or Basis Management Platforms or Management Integration, etc.
Business Process Outsourcing (BPO)
Interior Management Services: Provide various types of internal management services for clients. Enterprises to provide various types of internal management services, including logistics services, human resources services, payroll and welfare services, accounting services, financial centers, data centers and other internal management services, etc.
Enterprise business operation services: for customer enterprises to provide technical research and development services, sales and wholesale services, after-sales service (after-sales telephone guidance, maintenance services) and other business process links of the services.
Supply Chain Management Services: Provide client companies with procurement, transportation, warehouse/inventory overall solution services, etc.
In addition, there is a kind of Knowledge Process Outsourcing (KPO), which is the high-end part of service outsourcing.
They are both IT-based service outsourcing. ITO emphasizes technology and is more concerned with costs and services, while BPO emphasizes business processes and addresses issues related to the effectiveness of the business and the efficiency of the operation.BPO tends to involve a number of business guidelines and often has to contact the customer, and is therefore of greater significance and impact. Not only does the IT industry need BPO, but every BPO business can't be separated from IT business support, thus creating IT outsourcing opportunities.
Fifth, inbound and offshore (international) outsourcing
Inbound outsourcing refers to the transfer of outsourcing (outsourcing provider) and its outsourcing contractor (supplier) from the same country, the outsourcing work is done in the country.
Offshore (international) outsourcing refers to the outsourcing transferor (outsourcing provider) and its outsourcing recipient (supplier) from different countries, outsourcing work completed across borders.
Offeror and receiver
Offeror, also known as the contractor, generally from countries and regions with high labor costs, such as the United States, Western Europe, Japan. The outsourcing side, that is, the outsourcing provider, comes from countries and regions with lower labor costs. The world's major service outsourcing recipient countries are seven, namely, Ireland and the Czech Republic in Europe and China, India, the Philippines, Malaysia and Singapore in Asia.
Sixth, a broader sense of service outsourcing:
refers to the services agreement, the ongoing management or development of a service will be entrusted to a third party to authorize the implementation of the WTO's General Agreement on Trade in Services
Services Outsourcing Process
Services are classified into 12 sectors, namely, business services, communications services, construction and related engineering services, distribution services, education services, environmental services, environmental services, services and services, and services. services, education services, environmental services, financial services, health services, tourism services, recreation, culture and sports services, transportation services, and other services. Outsourcing of services can be categorized by these 12 sectors.
Other definitions and classifications of service outsourcing are: according to the motivation of service outsourcing, service outsourcing is divided into: strategic outsourcing, strategic outsourcing and transformational outsourcing; according to the form of service outsourcing, service outsourcing is divided into: outsourcing of products or components and outsourcing of service projects; according to the number of layers of outsourcing subcontracting service outsourcing is divided into: single-level outsourcing and multilevel outsourcing; according to the number of outsourcing contractors will be service outsourcing is divided into: one-to-one outsourcing and one-to-many outsourcing.
Service outsourcing refers to a management mode in which an enterprise outsources its non-core business and utilizes the best external specialized team to undertake its business, thus enabling it to focus on its core business to achieve cost reduction, efficiency improvement, enhancement of core competitiveness of the enterprise and its ability to adapt to the environment. It includes business process outsourcing (BPO), information technology outsourcing (ITO) and knowledge process outsourcing (KPO).
Service Outsourcing Enterprise refers to a service outsourcing provider that provides service outsourcing business to its customers based on the medium and long-term service contracts it has signed with service outsourcing contractors.
Service outsourcing business refers to information technology outsourcing (ITO) and business process outsourcing (BPO) services provided by service outsourcing companies to their clients. Including: business transformation outsourcing, business process and business process service outsourcing, application management and application services, such as business application outsourcing, basic technology outsourcing (IT, software development design, technology research and development, basic technology platform integration and management integration).