Insourcing vs. Outsourcing

Outsourcing has become a very common practice in business and is thought of as the moving of operations or functions overseas, and although a great deal of outsourcing is done locally, the term has some negative connotations in some circles.

The term insourcing is the opposite of outsourcing and it means the delegation of operations or functions from within a business to an internal, independent entity (i.e., a subcontractor) that specializes in that operation or function.

Insourcing of some critical functions such as HR, IT and Legal is a growing trend for small to mid-size growth companies that may not have access to the same financial and other resources that larger companies have available. For the legal function in particular, insourcing of the general counsel function can provide a very cost effective alternative to obtain in-house legal services through business savvy, senior level attorneys without the high cost of hiring a general counsel on staff or using the more expensive services of an outside, traditional hourly-rate law firm.


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