Why you should engage a Corporate Services Provider?
Service Companies In Ghana
In our fast-growing economy, the activities of businesses have become complex, engaging, and time-consuming. Businesses are under pressure to satisfy the demands of consumers as well as strategically position themselves for a competitive advantage over other brands. With the need to deliver the best services or products. Service Companies in Ghana focusing on their core activities is undeniably vital to their survival.
Whiles placing much emphasis on their core activities, the secondary functions of businesses need attention as well. Since delivering on core functions as a business is a priority, it is necessary to subcontract the non-primary services to an external company. This process is generally termed outsourcing. Outsourcing involves handing over tasks outside the core competencies of an organization to a Corporate Services Provider (Sharpe, 1997). The services outsourced are primarily the back-office functions of service companies in ghana.
In recent times, companies tend to outsource Information Technology services, Accounting, Book-keeping, and Payroll services, company incorporation and registration, and secretarial and compliance services. The provision of professional outsourcing services requires a Corporate Services Provider (CSP) with significant expertise in secondary functions of an organization.
Thus, the Corporate Services Provider is a third-party contracted to undertake secondary tasks of an organization’s business process so as to allow the organization to focus on its primary object of business. The service companies in ghana expected to have in-depth knowledge and experience in the field and offer company formation and management services. Together with comprehensive advisory support to assist companies of all sizes to run business operations successfully.
The determination of what constitutes a secondary function to outsource depends on the main object and the field of operation of an organization. Every organization has units that are fundamental to its operations, which considered the primary revenue-generating components of the organization. However, other functions exist within an organization that supports the delivery of primary objects. These are termed secondary or non-primary functions.
An accounting firm would consider its audit and tax lines as fundamental units while its finance, human resources. And IT functions are secondary functions but are crucial to the efficient running of the firm. The IT function, for instance, may not directly generate revenue for the accounting firm. Though it supports operations as well as providing information for customers through the website.
The decision to outsource – commonly referred to as a ‘make or buy’ decision. Influenced by numerous benefits that make it an attractive and viable venture. A major motivation for outsourcing is that it allows the organization to focus on its core competencies. Thereby increasing the efficacy of its business processes. The engagement of a Corporate Services Provider allows management to channel efforts more towards revenue-generating tasks. Providing greater scrutiny and attention to major functions. Employees whose tasks overlap between core competencies and secondary functions are also then freed up to be more engaged in revenue-generating activities.
Moreover, outsourcing offers an avenue for cost-saving. In view of the specialization in respective fields by Corporate Service Providers. They are proficient in offering services at a lower cost per unit. Accordingly, a Corporate Services Provider can offer secondary services to organizations at a cheaper cost. Than it would cost for the organization to produce in-house.
Organizations that opt for the buy half of the ‘ make or buy decision’ report significant cost savings (Rimmer, 1991). Furthermore, it is found that there is a correlation between outsourcing and best performing organizations including identifying outsourcing as typically the cost-effective option (Laugen, Acur, Boer, & Frick, 2005).
Outsourcing provides organization access to external skills and technology and also relieves it of constraints in-house. Corporate Service Provider’s access to increased specialization and expertise implies the provision of enhanced services to organizations. The greater efficiency of outsourced tasks creates added value to the organization.
Outsourcing business components that were previously produced in-house enhances financial flexibility and improved cash flow position. The extra cash can then meet pressing obligations as well as take advantage of market opportunities relevant to the organization’s core competencies.
Outsourcing is equally important to start-ups as it is too large for corporations. Since young organizations are at a higher risk of dwindling during their early stages. Outsourcing is more beneficial to prevent them from collapsing. Delegating secondary functions to corporate services companies in Ghana will ensure that the main objectives of small and medium scale enterprises are achieved whereas their back-office needs are duly and professionally handled.
Much attention and commitment can then be given to the core components of the organization. In order to build a solid business base and to scale up their operations.
Organizations which outsource have access to greater expertise while decreasing risk. By engaging a Corporate Service Provider, an organization minimizes associated risks in managing functions that are outside the scope of its primary focus. Corporate Service Providers are more capable of handling non-core tasks as a result of their specialization and deliver results to their clients.
Harland, C., Knight, L., Lamming, R., & Walker, H. (2005). Outsourcing: Assessing The Risks and Benefits for Organisations, Sectors and Nations. International Journal of Operations & Production Management, 831-850.
Laugen, B., Acur, N., Boer , H., & Frick, J. (2005). Best Manufacturing Practices: What Do The Performing Companies Do? International Journal of Operations & Production Management, 25(2), 131-150.
Rimmer, S. (1991). Competitive Tendering, Contracting Out and Franchising: Key Concepts and Issues. Australian Journal of Public Administration, 50(3), 292-302.
Sharpe, M. (1997). Outsourcing, Organizational Competitiveness, and Work. Journal of Labour Research, XVIII(10), 535-549.