outsourcing during the recession

How Outsourcing Helped Companies Survive the Recession in 2008

Some happenings in life are inevitable. Things like bushfires, tornadoes, floods, and earthquakes, among many other unfortunate happenings, happen in our lives, and there is nothing we can do. Such events leave people in bad shape, both economically, physically, and emotionally. While there is nothing we can do, we can only figure out different ways to fight for another day.

The same scenario also happens in businesses but is a different perspective. When economic times are hard, many businesses experience great losses, people lose employment opportunities, businesses shut down, and people are left stranded, wondering what is next.

During hard economic times or rather during recession times, business people ought to adapt to changes and implement business survival strategies instead of waiting for the situation to get better, which might take ages. As a way of preparing business people to always stay prepared for anything that can happen to cause a business downfall, we will highlight the significance of outsourcing as a way to help companies stand strong during harsh economic times. Keep reading for informative insights.

Understanding Recession in relation to outsourcing and business

A recession in business is a period when most business activities are declining. For instance, when the unemployment rates are increasing every other day, when the firing rates are higher, there is a decline in consumer spending, a decline in average income, a growing rate of business failure, and declining stock markets.

However, any business person who understands economic changes knows and anticipates anything to happen. That is why adequate preparations are a significant requirement for all business people.

So, outsourcing is one of the strategies businesses can implement during the recession to ensure they still stand strong. While some business managers might be skeptical about the whole outsourcing concept, the concept will always turn out to be beneficial to the whole company in different ways.

Note: Not all companies suffer the economic heat during the recession; some actually thrive and grow even better. But then, how will outsourcing help struggling companies during the recession? Let’s find out in the next section after highlighting some of the companies that thrived during the recession.

Companies that grew through outsourcing during the 2008 recession

There are several reasons why some companies may have some uncertainty about whether to take the outsourcing route during the recession or not. However, since some giant startups took the outsourcing route during the recession and grew, what could make small startups not do the same and flourish?

Below are some top companies that strategized in outsourcing during the recession to ensure they stand strong and keep up with their operations even in harsh economic times.

Apple Inc.

This is one of the companies whose one out of three engineers is outsourced. In most cases, the giant company outsources top talents from China. To date, the company keeps growing as a result of IT and manufacturing outsourcing.


IBM is one of the giant tech companies that has grown as a result of outsourcing and partnering with top talents from other nations. The IBM company signed several contracts for outsourcing services, a sign that outsourcing is the best way to help a company grow and withstand recession effects.


Netflix is known for the best provision of streaming on-demand consumer videos. The entertainment startup, through outsourcing, was able to implement workable solutions to meet the market’s needs.


Cisco is yet another tech giant that stood strong despite the 2008 global recession, thanks to outsourcing.

Through outsourcing and partnership strategies, Cisco has managed to expand its business and establish market leadership


Skype is one of the businesses that remained strong during the recession period, thanks to outsourcing impact.

Skype’s founders took chances and outsourced top back-end development talents and partners initially. That is why to date; skype is among the top businesses that survived the 2008 great recession.

The positive impact of outsourcing during the 2008 great recession on companies

Below are some of the advantages of outsourcing and it helped companies stand firm despite the harsh economic times during the great recession in 2008.

Cutting on operational costs

During hard economic times, the business should aim at minimizing operation costs while maximizing profits as a way to remain strong in the market.

Therefore, outsourcing top talents during a recession helps to reduce operational costs since you don’t need a full-time workforce that is quite expensive.

Again, with outsourcing, business managers can opt to keep employees that are adding significant value to the business. Therefore, with outsourcing, you simply pay a fixed amount agreed to the services offered after outsourcing the company.

Helps eliminate over-work for employees

Of course, during a recession or economic hardships, there will always be the massive firing of employees. Now, when mass firing takes place, there will be an over-workload, which will lead to duties and responsibilities being left unattended. Therefore, there will be a pile-up of things to do and manage for the company to keep its operations on its toes.

When this happens, it will definitely cause work stress. In such instances, outsourcing top talents helps curb the over-work load for potential employees, thus creating a smooth working environment for employees and an organized workflow.

Outsourcing maximizes productivity

Harsh economic times mean firing some employees, and this is a global effect of recession. Therefore, all other small tasks will be pushed to high-level employees as a result of declining resources. In the end, these high-end employees won’t be in a position to perform exceptionally and deliver the desired results in their respective areas or duties. Of course, this will lead to poor or low productivity for the company. In such scenarios, outsourcing is the ultimate solution as the move gives employees room to perform exceptionally to deliver great results.

Outsourcing helps relieve employee’s stress

In harsh economic times, the employees in a company will always be fewer because of massive firing, which is inevitable. This will cause pressure on the few employees who have to perform extra duties. When employees are pressured, they are likely to deliver poor results. Since the goal of the company is to maximize production while minimizing expenditure during the recession, the only solution is to outsource top talents from elsewhere to give the remaining employee an opportunity to perform and deliver results exceptionally.

Better benefits

Economic decline makes business managers cut costs, which leads to loss of benefits for several employees.

In such cases, outsourcing teams for services like IT, marketing, and accounting, among many others, means you don’t need to worry about paying for extra benefits. The benefits are only applicable to the remaining few employees.


Are you an entrepreneur running a business? Well, you must be prepared to handle every situation that may come, whether positive or negative. If you haven’t tried outsourcing, you might need to give the idea consideration since it might be what your business needs to keep scaling higher.

Finally, connect with offshore development center in order to reduce your cost by outsourcing.

Written by:

Muzammil K

Muzammil K is the Marketing Manager at Aalpha Information Systems, where he leads marketing efforts to drive business growth. With a passion for marketing strategy and a commitment to results, he's dedicated to helping the company succeed in the ever-changing digital landscape.

Muzammil K is the Marketing Manager at Aalpha Information Systems, where he leads marketing efforts to drive business growth. With a passion for marketing strategy and a commitment to results, he's dedicated to helping the company succeed in the ever-changing digital landscape.