Final answer:
Outsourcing is utilized in modern companies by subcontracting non-core functions to outside contractors, which improves cost-effectiveness.
Step-by-step explanation:
In modern companies, outsourcing is utilized to improve cost-effectiveness by subcontracting non-core functions to outside contractors. This allows companies to focus on their core activities while reducing costs associated with non-essential functions like customer service or back-office operations. For example, companies may outsource their call center operations to countries where labor is cheaper, such as India or the Philippines.