Outsourcing vs. Contracting

Filed in archive Basics on April 8, 2004

I've just received a review copy of Peter Bendor-Samuel's Turning Lead into Gold: The Demystification of Outsourcing, a book about outsourcing written 1999 that is still very valid today.



Source: TurningLeadintoGold.com

This 222-page hardcover book with well-designed cover answered many of my questions, such as pioneers of outsourcing, the importance of leveraging and some of the best approaches used by the pioneers.

To make the long story short, I was quite impressed by the simple-but-straight to the point differences between outsourcing and contracting. Quoted from page 32:

One to explain outsourcing is to define what it is not. Contracting is the purchasing of goods or services when the buyer owns the process. If the buyer owns a proces but purchases time, products or services to facilitate that process, then the buyer is in a contractual relationship. If the supplier owns the process, then the buyer is probably outsourcing.

More interesting stuff from this book is coming shortly as I'm still finishing it!