Advantages And Disadvantages Of Outsourcing And Subcontracting

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Chapter 10: Outsourcing & subcontracting Outsourcing involves the transfer of an organization’s regular business activities (functions and processes) to an outside service provider that provides the services back to the organization, as defined in a (typically) long-term contract. The core of an outsourcing arrangement is that the control and ownership of the business activities are put into the hands of the service provider. The service provider then owns and manages the business processes, including the resources that are used to provide the services to that organization. In a typical outsourcing, the people, the facilities, the equipment and the technology are transferred to the service provider. Given the magnitude and complexity involved, outsourcing relationships tend to be long-term propositions, usually in the 5 to 10 year range, and sometimes longer.…show more content…
• Greenfield: The company buys new services from a service provider that it would normally have performed in-house (this is the ‘make vs. buy’

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