The Case Identifies Struggle And Problem Faced By Organizations Outsourcing

The decision to choose a product or service from an external supplier or vendor is referred to as outsourcing. The decision to outsource a product or service is a significant one, and the Project Manager must take into consideration additional costs, changes to schedule, deliverables, and value. Furthermore, there are also other decision-making factors, such as the need for control over the quality, proprietary technology, time constraints, and lack of expertise or limited capabilities of the external supplier (Project Management Institute, 2013). From a financial and scheduling standpoint, the decision is straightforward, as the success of the project is dependent on resources available through outsourcing. Since the project is dependent on an outside entity, the Project Manager must follow prudent measures to control the process. The first step in controlling the process is to determine the appropriate acquisition process. One reliable process is known as Performance-Based Acquisition (PBA). Performance Based Acquisition (PBA) is a results-oriented contracting method that focuses on outputs, and is written so that payment or contract extension is based on measurable performance. The main benefit of using PBA is to minimize costs, while improving vendor performance (NIGP, 2012). It is paramount that diligent research and evaluation methods are used to ensure that the best available vendor is

The vendors are investing in their employees by various training programs on different technologies. This gives a chance for the vendor to provide the outsourcing services to a company with the help of the well trained employees who are ready to work on the projects. Before outsourcing some of its products and services to a third part vendor, the company has to analyze all the factors that might result from the outsourcing decision, the advantages and disadvantages of the company both in short term and long term due to outsourcing. According to Aubuchon, outsourcing some of its products can be a good thing for a company and the judgment to outsource the services must not only based on the cost factor, but the company has to take all other significant factors into consideration (Aubuchon, 2014).

The decision about the project implementation methodology was done by the LAS appointed project management team who were inexperienced in the software field and hence were unaware of the efficient methodologies.[4]

Additional, here are a series of themes that explain most of the pressures for OSI to outsource. First of all, managers' concerns about cost and quality drive outsourcing. The same issues such as getting existing services for a reduced price at acceptable quality standard came up repeatedly. Second, failure to meet service standards can force management to find other ways of achieving reliability. Finding a company in which cumulative IT management neglect eventually culminated in an out-of-control situation from which the current IT

The origins of many outsourcing endeavors begin as part of a strategic planning session during a period of lean years for a company or anticipation of a prolonged impending down-cycle. This is a time-period when the organization does not have a viable competitive product to offer in the market or the

(Greaver, 1999) proclaims that outsourcing is of a strategic nature and that the decision-making process of a company should take this into account. He then goes on to define outsourcing as the act of transferring some of company’s recurring internal activities and decision rights to outside providers, as set forth in a contract. Because the activities are recurring and a contract is used, outsourcing goes beyond use of consultants.

The fifth problem is to outsource all of its IT operations for Reitzel but keep systems development in-house. The best plan has to be put in process in order to achieve the revenue targets. It does not seem right to only outsource some of IT’s operations while leaving some systems

While it lessens the burden on organizations, reducing and shifting the cost and risk of its IT operation, security and management issues to an external service provider or vendor, outsourcing any portions of an organization's Information System has significant risks that can sometimes become detrimental to the outsourced organization. According to the Commission on Government Outsourcing, "when outsourcing an organization exposes itself to significant risks in terms of security, accuracy, and completeness of information (Holroyd City Council, 2008)". Comprised in the rest of this document is an

There are so many reasons for outsourcing which is the improving organisational efficiency, reduced IT cost, better service, access to new technology & an ability to refocus in-house staff on higher-value work .The outsourcing option has two main types, first one is

The challenges for outsourcing are many as there are two different companies working together. The risk of something going wrong is based on whether the communication between the two is good. Communication is the most important part of the cooperation between the two companies.

In the past decade the topic of outsourcing has become a heavily debated subject on if it is ethically correct to outsourcing jobs to foreign countries. Outsourcing has become more and more an option for many companies and not just an economic fad. The decision to outsource is a difficult one for any company to make because there are many advantages and disadvantages to consider. The decision to outsource affects many people, communities, and industries so if a corporation decides to outsource they must consider how it will affect human dignity, the common good of the economy, and subsidiary.

Global outsourcing is used by companies to help enhance and develop the business. Global outsourcing also taken by a firm to help solve problems that occur in an Organizations. Global outsourcing is helping organizations to take some expertise from outside which takes outsourcing locally and internationally during the recent years. Global outsourcing is a prime example in the development of the industry. It has become common place among the companies, and the world is more global now than ever before. It is inevitable outsourcing has led to a growing demand for such items as it contracts or contract negotiations, and continue to create demand for more advanced technology throughout the business. Global outsourcing occurs when a business decides specific contract tasks or services to other businesses. Global outsourcing comes as a result of economic necessity, and transpires when a company specializing in the service or product that can perform or produce a more cost-efficient than a larger company. Projects of this great company submitted to the company more cost efficient. What many do not realize that it is important to enter into contracts and contract negotiations when outsourcing to a successful transaction.

“Outsourcing is the transfer of control of a process or product to an outside supplier”(Hasan).

Over the last five years the percentage of global Information technology (IT) budgets that have been allocated to IT outsourcing has progressively grown to 23% of total budgets as of the close of the latest calendar year. This continual reliance on IT outsourcing is fueled by not only cost, but also the ability to create new software applications faster, reduce time-to-market by attaining external expertise critical to a new projects quicker, and the ability to keep valuable internal resources focused on the most strategically critical projects (Rosebush, Leavell, Maniam, 2012). IT outsourcing, contrary to widespread public opinion, is not about chasing the lowest cost per labor hour around the world to have programming completed or routine maintenance of applications done (Khan, Niazi, Ahmad, 2011). Best practices in IT outsourcing seek to create a competitive advantage through the alliances with outsourcing partners, while at the same time optimizing overall organizational performance (Ren, Ngai, Cho, 2011). As all outsourcing is inherently filled with risk, any due diligence to create an effective IT outsourcing framework must begin with a thorough definition of risk management guidelines and objectives, followed by the prudent definition of risk trade-offs as captured in the contracts and service level agreements (SLAs) (Wan, Wan, Zhang, 2010). All of these factors must be kept in balance with one another for any enterprise to gain the full

It is an evident fact that outsourcing is quite prevalent practice among both public and private organizations. It has been considered as one of the prime elements of any business strategy. It is with the aid of outsourcing that organizations attempt to reduce the overall cost of sustenance and augment organizational productivity in comprehensive terms. The activity of outsourcing enables the organization to render higher level of emphasis on core activities of business. In the past thirty years, various researchers have undertaken researches to support outsourcing as a mechanism for bringing down organizational costs in a substantial manner. But the comprehensive impact of outsourcing remains to be seen. This research work will assess the relevance and significance of outsourcing in reference to the process of new product development.