A lot of people may wonder and ponder on the meaning of terms or words as they read articles, books, etc in relation to outsourcing. This could be a distraction or a discouraging factor if they have to look elsewhere for mere definitions. We understand that making a decision on whether or not to outsource might be challenging. We have decided to ease the process of your enquiry and give clarity to terms occasionally used on this page. Here is the list of terms and their meaning for reference purposes.

  • Back Office Operations: This refers to functions which requires less face – face interference with Client or her personnel. Such activities are majorly administrative in nature, such as customer service, information technology, data processing, accounting, payroll administration, etc.
  • Back Sourcing: This refers to the process of recalling activities or functions previously outsourced to be done inhouse. This occasions when an outsourcing agreement has expired or is been terminated.
  • Baseline: This relates to the drawn out and clear parameters for the outsourcing services.
  • Business Process Outsourcing (BPO): This is a type of outsourcing where a third-party service provider is employed to carry out one or more business functions in a company[1]. Can be seen as delegation of task to a third party.
  • End to End process: The completion of a business process from beginning to end[2].
  • Offshoring: this is the practice of basing a business (or some part of its operations) in a different country[3].
  • Outsourcing: The transfer (or delegation) to an external service provider of the operation and the day-to-day management of a business process[4].
  • Request for Information: A formal process of gathering information from potential customer.
  • RFP: This is an acronym which stands for Request for Proposal. It is a business tool used to show intent in a particular product or service[5]. It is also often used to propose the terms and conditions of an agreement in delivery of specific services.
  • Service Level Agreement: this is a binding and enforceable document between a service provider and its client detailing the commitments of each party and showing a map of their arrangement.
  • Statement of Work: Refers to a document that reflects the schedule or frame of work to be carried out in a project.

With the definitions simplified, you are better positioned as you walk the path of your outsourcing decision. 

[1] https://corporatefinanceinstitute.com/resources/knowledge/strategy/business-process-outsourcing-bpo/
[2] Nicholas C. Burkholder (2006) Out sourcing: The Definitive View, Applications, and Implications. https://onlinelibrary.wiley.com/doi/pdf/10.1002/9781119201205.gloss
[3] https://dictionary.cambridge.org/dictionary/english/offshoring
[4] ibid
[5] Eric Money (2020) RFP Meaning : A definitive Guide to the Request for Proposal https://rfp360.com/rfp-meaning/

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