Outsourcing Glossary
July 2002

Time to sharpen your terminology?
Reviewing these definitions from Firmbuilder.com will do just that.

ASP's: Application Service Providers are any organization that remotely hosts a software application and provides access to and use of the application on a recurring fee basis.

BPO: Business Process Outsourcing means examining the business processes that make up the business and its functional units, and then working with specialized outside service providers to both reengineer and outsource these at the same time.

E-Sourcing: Internet-based outsourcing that takes advantage of the emerging application service provider (ASP) delivery model. This solution offers the business process delivered through the internet.

Performance-Based Pricing: Contractual pricing mechanisms that link compensation to meeting specific performance objectives.

Strategic Outsourcing: Outsourcing to achieve better return on investment and accelerated growth. Strategic outsourcing is approached as a re-direction of the organization's resources toward its highest value creating activities — its core competencies.

Tactical Outsourcing: Outsourcing to achieve operational efficiencies. Tactical outsourcing is approached as a competition between existing internal operations and outside service providers.

Transformational Outsourcing: Outsourcing to take advantage of innovation and new business models. Transformational outsourcing is approached as a way to reposition the organization for competitive advantage

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