Outsourcing Is Becoming A Norm

2943 WordsOct 26, 201412 Pages
Introduction – airline outsourcing Outsourcing is defined as the decision to buy goods and services from external sources rather than producing them in-house when internal provision is not justified in light of existing or anticipated business condition (Leenders & Nollett, 1984). It is a common solution to outsource non-strategic business functions in order to diminish distraction and focuses managerial attention on operations within the scope of a company’s core competencies. This practice is widely adopted by today’s enterprises around the world, including airlines, to control costs, improve efficiencies and increase profitability (Feldman, 1992). However, although airlines are outsourcing their operations in order to remain competitive in increasingly challenging business environments, such practice may not always be successful and its theoretical justification may not have been fully explored (Rieple & Helm, 2008). This paper studies the potential boundaries to what airlines can or cannot outsource in their operations, and whether financial considerations are paramount in such decisions. The benefits of airline outsourcing Outsourcing is becoming a norm and the next critical business process many enterprises are addressing (Lindegaard, 2004). Today’s competitive commercial environment has forced airlines to explore methods to improve efficiency, and one of the common solutions is to outsource non-strategic business functions. Reservation and ticketing, customer service
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