Outsourcing can save companies a great deal of money. For example, you can hire home-based workers to make phone calls, answer the phone, and do general clerical tasks. Since the company wouldn't have to pay overhead for office space and benefits they would save money.

Outsourcing, in general, differs from the use of consultants or contracts workers because the activities outsourced are usually recurring; resources for performing the activities as well as the responsibility for making many of the decisions regarding the activities are transferred to other organizations. And, offshore, is generally defined as undertaking work using labor that is normally based in a remote location. The volatility of the business climate today hails for better business strategy. More businesses have decided to outsource some of their non-core competencies and processes to offshore destinations. Business activities commonly outsourced offshore may include call center, document processing, investment management, back office management and human resources. In the year 2000, for the first time, more than 54% of IT services purchased in North America were outsourced. Areas offshored include application development and maintenance, infrastructure management and embedded technology solutions, to name a few. The willingness to pay for outsourcing services is high especially among players in the banking, insurance, manufacturing, healthcare, and government sectors, driven by the fact that customers demand access to a more reliable infrastructure, with lower operational costs and greater flexibility. According to a Gartner group survey, outsourcing is expected to grow at the rate of 8.8% between 2003 and 2006. Goldman Saches estimates the BPO market in 2005 to be US$585 billion. The growth is likely to be driven primarily through offshoring of traditional outsourced processes such as call centre support, IT support and back office processing. The growth in the use of offshored services has showed that its benefits are no longer just about price - they can include service quality improvement, scalability, better risk management and the freeing up of internal resources to focus on core value-adding activities. Recent trends also point to companies exploring the outsourcing of entire functions such as sourcing, procurement and supply chain management.