What are the 5 Types of Outsourcing?

Nowadays, entrepreneurs and companies rely on outsourcing to cut operational costs and focus on growing their business.

If you are planning to seek outsourced help, learn how outsourcing works and what outsourcing model will give you the best benefits. The general rule is to define outsourcing based on the job to delegate and how the result will be delivered.

The most common outsourcing models are as follows:

Project-based Outsourcing

These projects have well-defined requirements as well as deliverables. Companies outsource them to a dedicated team that can deliver excellent results without disrupting the regular tasks of their staff.

Staff Augmentation

Companies often outsource help because they need a skilled workforce that can work part-time. This model is usually utilized by companies who offer add-on services like outsourced customer experience support services to expand their business.

Managed Services

This outsourcing model is commonly used to hire IT, HR, production, or daily operational support. The managed service provider (MSP) assumes the responsibilities of monitoring, problem- solving, or handling specific backend office functions.

Contracting or Out-tasking

In this model, the company transfers a specific service or process to its outsourcing partner. Meanwhile the out-tasking involves licensing, where the partner gets permission to use the intellectual property of the company. Another means is through contracting, where a third-party supplier manages a set of processes or performs a group of tasks for the client. It can be in a yearly, monthly, weekly, daily, or hourly basis.


This involves relocating the dedicated resources to another country where skilled and professional workers can be hired at lower compensation. It allows the foreign company owners to maintain full control over the process and delivery of services. It also opens up accessibility to new market and opportunities.

These outsourcing models provide flexibility and optimum growth opportunity for your business. To ensure the success of outsourcing your projects, choose the best-outsourced partner or BPO company in the Philippines.

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