The traditional Holy Grail of outsourcing, this is an outgrowth of all the previously listed advantages. Cost savings can be heavily influenced by the structure and terms of the outsourcing contract. The key potential downside of outsourcing. Delegating a task without sufficient oversight can lead to negative results. To combat the problem, firms must exercise vigilance and effective management throughout the duration of the outsourcing arrangement.
Problems can arise from poor communication, differences in company culture, and misaligned motives.
Outsourcing partners can be overwhelmed, just like the company that has hired them. In some cases the partner may be incapable of the rapid flexibility necessitated by changing business conditions. In the worst of cases, a provider firm may slack off after the contract is signed-but this is rare. Unexpectedly high costs. This is often an area of disappointment.