Introduction
Outsourcing can be defined as a contract service agreement in which an organization hires out all or part of its company responsibilities to an external company.
More and more companies are leaning towards outsourcing it could be said that this may be caused by the growing complexity of Companies and the changing business needs of an organization. As a result, an organization may find that it is not possible to have all its company services supplied from within its own company. Given this, a Company may decide to choose to seek assistance from an external contractor/company to supply their services the organization lacks. In addition, the business competition has set the pace for an organization to continue to strive for internal efficiency. It also needs to look for a way to transfer non-core activities or "in house" services and support activities to external specialist organizations who can deliver quality services at a lower cost.
Fundamentals
In deciding whether to use outsourcing or not, the main objective of outsourcing is based on the price of delivery of services by an external contractor/company. Although price of delivery is a primary factor for outsourcing, other issues should be considered e.g. price should be measured against the overall package offered by the external contractor/company. Briefly if it's a good competitive price in relation to the services rendered by the company and in respect to their skills/competency and experience, and timely delivery. The organization also needs to consider outsourcing in light of its long term strategic directions and its information needs.
Competition is another area to be carefully considered. Competition opens up opportunity for all potential suppliers to conduct business with the organization. Through the competitive process, it allows organizations/Companies to derive the best outcome. From the open and effective competition, the organization is then able to judge soundly in determining the best strategy after it has taken into account of the competition and value for money principle.
On May 16th, 1838, Lucretia Mott held the second Anti-Slavery Convention of American Women. The women of this convention were fighting to end slavery in Washington, D.C. and also wanted to boycott goods created by slave labor. During the women’s protest, they approached a riot. The crowd of 17,000 people that they were facing explained that if the blacks were freed there would be fewer jobs for everyone else in the state. It would also bring wages down even more from what they were already at. During this time period, majority of the people were factory workers who feared losing their jobs. They believed that African Americans were not worth losing their jobs over, so they wanted them to be kept as slaves. However, Lucretia did not feel as though this was right. She believed that they deserve to be able to work and be free just as much as everyone else in the community. The mob of people threated the women that were included in the convention with violence, and Lucretia was not going to stand for that. Each white woman linked arms with an African American woman and walked out of the building. After walking out of the building, the doors were locked...
...over the inconsistent conflict concerning the Fourteenth Amendment, Lucretia joined with Anthony and Stanton to form the “National Woman Suffrage Association”, devoted to creating a federal amendment granting women the vote. Lucretia and her husband wanted to open a Quaker institution of higher learning. It was named Swarthmore College. When the college had been chartered in 1864, she and James had insisted it be coeducational.For years she was vice president of the Universal Peace Union. In 1870 she was elected president of the Pennsylvania Peace Society, an office she held until her death. Mott grew to believe that a new spirit was at work in the world that demanded active involvement in reform
Outsourcing simply means acquiring services from an external organization instead of using internal resources (Butler, 2000). By using outsourced resources, organizations can gain a competitive advantage by utilizing contingent staff to accomplish strategic goals without incurring the fixed overhead. By focusing on the leading edge and highly specialized skill sets, outsourcing providers can often offer higher quality services, or at a lower price than the client organization. Typical reasons for outsourcing go beyond simple contingent staffing. Outsourcing providers are able to maintain economies of scale with regard to specialization (...
Outsourcing is a strategic activity in which some of the internal activities of the organisation are delegated to external firms because of various reasons such as:
Other researchers have identified several outsourcing issues, trends and strategies that companies take in establishing and effectively managing their outsourcing activities (Sinderman 1995; Carney 1997). The trend is for outsourcing relationships to function more as partnerships. Outsourcing providers are taking increasing responsibility in realms that have traditionally remained in-house, such as corporate strategy, information management, business investment, and internal quality initiatives (Sinderman 1995; Carne...
Top 7 Outsourcing Advantages Outsourcing Advantages: A Back-Office Operations Illustration By James Bucki ; http://operationstech.about.com/od/officestaffingandmanagem/a/OutSrcAdvantg.htm
While some large firms are able to find a service provider to cover some of their outsourcing needs. Few firms have found a service provider that can take over entire functions. Some have found that finding a service provider capable of providing services required only at a non-cost-effective-rate. The lack of a competitive marketplace may adversely affect the cost savings. (a350397)
Outsourcing is to obtain (as some goods or services needed by a business or organization) under contract with an outside supplier. (Merriam Webster) Some of the time an organization can not handle all aspects of a business process internally. The advantages of outsourcing is allowing companies to have lower operational and labor costs, faster production, and allowing companies to focus on core activities.
Outsourcing is a term defined as the movement of jobs elsewhere to another company that can perform the same tasks, even though there is the potential of doing the jobs inside the company itself. An example of outsourcing is currently being done at your company, where contractors, usually part of their own contracting company, are performing the duties the old employees used to do. Another example of outsourcing can be moving jobs overseas, such as to developing nations, where cheap labour is readily available and the laws are much less restrictive. In both of these circumstances, the aim of outsourcing is to provide a cheaper alternative for the company, while improving its efficiency. Though there is usually deep public backlash from workers right over Australia, when jobs are being sent overseas.
Competitive advantage is mean a firm’s ability to create value in a way that is rivals cannot. While outsourcing is a business strategy that moves some of an organization’s functions, activities, processes, and also decision responsibility from an organization to outside providers. This outsourcing is done by doing negotiating contract agreements with a vendor who takes the responsibility for the quality, customer services, production process, and people management of the function. So, to allow organizations to focus on their core business and create a competitive advantage, the organization must use outsourcing. Outsourcing is use to reduce operational costs. However, outsourcing have a lacking or disadvantages such as quality risk, quality service, language barriers, labor issues, and legal compliance and security.
To fully take advantage, the company needs to better understand its expectations on the subject, its obligations, along with its constraints and desires. It is therefore proper diagnosis of its needs can be acheived by asking the right questions. Many outsourcing operations prove to be a failure (Barthelemy, 2003; Bryce & Useem, 1998; Embleton & Wright, 1998). Many organisations are barely aware of the process that they initiate when they decide to outsource (van Engelen, 2005). Internal HR staff devotes only a fraction of its available time to the management of external relations and the monitoring of providers (Lepak & Snell,
After consulting various articles about the subject, the author will give a brief definition of what outsourcing is and the types of activities that companies source outside of their company’s boundaries. Moreover, the author will mention the risks that both the client and the service provider face when outsourcing takes place, and will also talk about how control measures of...
Outsourcing is a technique for companies to reassign specific responsibilities to external entities. There are several motivations for outsourcing including organizational, improvement, cost, and revenue advantages (Ghodeswar & Vaidyanathan, 2008).
A disciplined approach to management eying leading employees, improving the management team and building the business strategy. Instead of treating each problem as a one off. They design systems and structures that make it easier to handle in the future. (Techrepublic, 2015) 2.2. Risk of exposing confidential data: When an organization outsources HR, Payroll and Recruitment services, it involves a risk if exposing confidential company information to a third-party Synchronizing the deliverables: Some of the common problem areas include stretched delivery time frames, sub-standard quality output and inappropriate categorization of responsibilities. At times it is easier to regulate these factors inside an organization rather than with an outsourced partner Hidden costs: Although outsourcing most of the times is cost-effective at times the hidden costs involved in signing a contract while signing a contract across international boundaries may pose a serious threat Lack of customer focus: An outsourced vendor may be catering to the expertise-needs of multiple company at a time. In such situations vendors may lack complete focus on your organization 's tasks. 2.3. 1.Know the
...urcing services, the company operation will be became a mess. This is because one organization can’t run a lot of task or project at one time. Therefore an organization need outsourcing in the way to help their organization run smoothly.