Advantages And Disadvantages Of Offshore Outsourcing Essay

1765 WordsNov 28, 20168 Pages
Advantages and Disadvantages of Offshore Outsourcing Kati Methvin University of North Alabama Advantages and Disadvantages of Offshore Outsourcing Today, offshore outsourcing is an attractive alternative to in-house or domestic production. The approach imports several advantages that appeal to companies, particularly multinationals, which explains the great traction that it has gained across the globe. Even so, delegating tasks to foreign third parties also carries a suite of new risks that businesses must handle. Without proper execution, the approach may result in adverse outcomes that outweigh its value. This paper offers an in-depth analysis of the pros and cons of offshore outsourcing. Outsourcing is a process whereby firms delegate tasks or operations to an external party who can deliver better quality cheaply and promptly (Tayauova, 2012). Outsourcing takes place when the business allocates some tasks to a third party and offshore outsourcing entails assigning that work to vendors in foreign countries (Gnuschke, Wallace, Wilson, & Smith, 2004; Davis, Ein-Dor, King, & Torkzadeh, 2006). Now, the outside supplier can be a specialized company, contractor, or a development house (Soriano-Meier, Garza-Reyes, Lal, & Rocha-Lona, 2012). The outsourcer typically assigns the responsibility and risk for carrying out specific functions to an external entity. This practice entails transferring activities that companies traditionally performed in-house to an external vendor or

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