Essay On Outsourcing

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Impact Of Outsourcing To Employees In Facilities Management Outsourcing is the strategy that has gained worldwide momentum in the facilities management. From the term outsourcing we mean to sublet the part of the company’s job to some outside manufacturer or service provider, owing to many tangible and comprehendible reasons. The competitive service market today is facing multi-faceted challenges offered from many directions. The saturating markets today owing to prolonged recession worldwide have triggered ferocious competition among the service providers to make the most of the scarce opportunities available in the market. Such competition in the service market compels the service providers to accept the market dictation both in terms of reduction in price as well as improving speed of delivery of service. We all know that when the market dictates, the point of focus of service providers shift from price of the service to cost of the service. The mounting pressure from market thus compels the service providers to concentrate on cutting off the costs of the operations. One of the most widespread counter measures to tackle the cost pressures in industries today is partial outsourcing of the operations. One of the main hurdles in the way of reducing costs today, especially in developed countries, are owing to the mounting wage rates of the labor force. An industry cannot even think of reducing the cost of the operation if the wage rates in the organization are increasing or at least are difficult to be brought down. In these circumstances, the companies are left with no other option but to sublet part of their operations to outside cheap vendor in order to make most effective use of their facility at cheaper rates as well as exped... ... middle of paper ... ...e use of cheap wage rates only. However, it does not mean that taking benefits of cheap wage rates of the vendor organization is not of any significance for the company outsourcing. In fact it is one of the main concern but the other aspect of outsourcing like to expedite the service delivery and to enable the company to deliver its services to a much larger market are other major incentives that oblige companies to sublet their operations partially. However, the misconception among the employees of an organization must be removed that the outsourcing would affect their economic benefits and they must realize that only those operations are logically ousourced that cost more without giving comparable productivity. In that sense, outsourcing is a way to cut the fats from the operation of the company and make it more sustainable in the competitive business world today.

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