Disadvantages Of Outsourcing

However, there needs to be serious analyses done to determine the correct action to take. Financially, many outsourcing deals make sense. Furthermore, it gives businesses an opportunity to have business segments performed by professionals or in a much more efficient fashion; if the proper workforce or operational procedures are not in place. In a small business, I believe that outsourcing is a great way to have complex or strategic roles filled within an organization. Additionally, the customer base is smaller and allows the small business to still interact intimately with each customer. However, for a large business, outsourcing may create holes within the organization that makes them vulnerable. Specifically thinking about customer service roles, Vitthal Gore (2013) talks about the emergence of call center or Business Process Outsourcing (BPO). As the 21st century begins to impact the globe, many countries are being targeted for their people as the new-age workforce (Gore, 2013). Additionally, Gore notes as more people become competent in the English language, the easier it is for a business to tap into the untouched workforces of the East. While many times cheaper for companies to outsource their customer-service segments, many Americans expect a high-level of service from their provider, and as such, some of those quality controls may be lost in a total outsourcing (Gore,

Outsourcing is a method used by many corporations in which their products are manufactured in foreign countries often for cheaper labor.This method method of productions has it’s pros and cons.

You may have been asked if your job is next with the recent outbreak of shipping American jobs overseas. Lately, all of the corporate talk is about outsourcing and how it’s helping American companies grow, but what is not talked about is how it’s going to effect the American economy in the next few years and what should be done to stop it. Outsourcing is a modern plague that is killing the American dream. Its long-term effect is catastrophically damaging to the American economy and Americans need to step up their educational expectations, skill sets and motivation if they are to keep that long-fought for dream alive.

Because of outsourcing jobs to overseas many American workers lost their jobs or compelled to work for much less compensation. This trend leads to the shrinkage of middle class income bracket and the reduction of the family’s standard of living. Besides, due to the elusive future employment status and the financial problems, many people have to live hand to mouth, and many more have to cut their expenditures in order to survive this dreadful and unpleasant situation. More importantly, the reduction in spending money and the deterioration of consumer confidence can hurt the economy severely and exacerbate the situation.

American companies trust in foreign labor to produce goods, but they are neglecting the American public with jobs, and properly made goods. With cheap labor American CEO’s can save money and make a better profit. Dr. Ron and Anil Hira explain the upcoming danger American jobs will face in the future “nearly one in nine of all U.S. jobs-are vulnerable to being outsourced” (Ron Hira Ph.D and Dr. Anil Hira 2). Business owners can make an impact on this problem by creating more work for U.S. citizens. Outsourcing will put more money in the pockets of wealthy CEO’s and in turn will create an even larger imbalance between the classes. The problem can be weakened once government regulations limit the amount of jobs that are outsourced, but also

Outsourcing overseas is a major disadvantage to the American economy. Contrary to popular belief, companies argue that low- cost labor will in turn save them money and raise competitiveness, which will result in less costly products. When taken into consideration outsourcing eliminates domestic jobs. When a firm outsources, the jobs outsourced are, by definition, removed from the country. These jobs are then sent overseas, where labor is paid far less than in the United States:

Therefore, outsourcing is challenging for companies because they are several tasks involve in this process. For example: selecting the correct provider of outsourcing, what is the company’s goal, identifying the core and non-core business activities, defining the process that should be keep it in-house or the activities that are better to outsource, to a country that works based on the comparative advantage. Consequently the main propose of outsourcing is to lower costs, and this can cause a direct impact in labor rights.

clear. It simply shoes some arguments of a proponent and a opponent. We still need hard evidence

Outsourcing is defined as "the process of purchasing goods and services from outside vendors rather than producing the same goods or providing the same services within the organization." Outsourcing does not come without risks, but it also has its benefits as well. Gaining services or products from outside sources can be very beneficial, considering the alternative that the firm will have to produce them themselves. However, on main risk that is incurred when outsourcing is that when a firm does outsource, they leave the supply of that product or service in the hands of someone of whom they cannot control, contrary to controlling their own supply. Ethical issues are at hand here, as well as trust issues. As you will see in this paper, many different opinions about outsourcing are present among different financial investors and financial officers. Management teams and management leaders are the head personnel that weigh the pro 's and con 's of outsourcing, and this paper will briefly summarize the various opinions, pro 's, con 's, large benefits, and ethical issues dealing with outsourcing.

Outsourcing is the contracting out of an internal business process to a third party organization. The term "outsourcing" became popular in the United States near the turn of the 21st century.(6) Outsourcing is big business today even for small businesses. Like every business decision we are faced with the advantages as well as the disadvantages of relocating part or all of a business. Outsourcing is one of the fastest growing trends in business as large-scale organizations have latched onto outsourcing due to the almost immediate savings and quality improvement. (1)

Airtel’s strategy of outsourcing with Nokia Siemens and Ericson included buildup, maintenance and overhauling of network telecom equipment’s. Airtel’s contract was a two pronged outsourcing structure to its vendors. The vendors will provide network capacity requirements as mentioned in the agreement. Payment models were based on the customer utilization of the capacity, hence paying for only what is used. Ownership of assets rests with Airtel, maintenance responsibility with the vendors. Techniques were taken to check quality parameters. The contract was for 3 years and renewable under mutual consent. Airtel followed Dollar Per Erlang model which meant pay only for the Traffic that come out of the tower. Airtel’s contract with IBM was for 10 years and had complete, end-to-end management and wide-ranging services for supplying,

When outsourcing is done for the right reasons will actually help your company grow and save money and hence the advantages;

One of the most important forces of outsourcing is that organizations do not have gain the needed and required sources internally. And they have a difficulty in integrating and attracting expertise, where outsources own capabilities on a global level, modern technologies and other required resources. Also, by outsourcing the cost of keeping employees and consultants for short term is reduced. Furthermore, outsourcers are able to offer better career opportunities for business IT staff if they decide to transit to the outsourcer. As the manager of BP Company viewed the main reason of BP Company outsourcing is that "it has become increasingly apparent that service companies provide us with technical skills and ideas that we could no longer develop inside our own company" (Kremis, 2006).

Company may also use the strategy of outsourcing. Outsourcing means to give the charge of one or more sectors of the company to other company, who is at best in that sector or product. Qualcomm has poor HR system, so this company can outsource its HR department to the IBM, which is performing and organizing very well its HR department.

Outsourcing refers to hiring an outside, independent firm to perform a business function that internal employees might otherwise perform. Many organizations outsource jobs to specialized service companies, which frequently operate abroad. The outsourcing trend stands to continue; the latest wave of outsourcing impacts the information technology field. IT outsourcing includes data center operations, desktop and help desk support, software development, e-commerce outsourcing, software applications services, network operations and disaster recovery.2