How Does Outsourcing Differ From Offshoring Case Study

How does outsourcing differ from offshoring?

Outsourcing is “hiring an organization to do a task your firm previously performed” (Tanner and Raymond, 2010, p. 173). Companies outsource when they want to lower costs of production. Outsourcing has become very popular for companies in the United States. Companies prefer to work with other companies outside of the U.S. because they have cheaper labor costs than the labor costs in the United States. According to Tanner and Raymond (2010), “outsourcing work to companies abroad is called offshoring” (p. 173). Basically, offshoring is the practice of these U.S. companies working with organizations abroad instead of onshore.

How can just-in-time and vendor-managed inventories add value to products

Outsourcing and Offshoring are often confused with each other, as they are often the same thing. However it is important to understand the basic differences in them. Outsourcing refers to any work that a company contracts out to another company. Offshoring is when this work is done in another country. An example is my work with 911. We are an extension of the police and fire departments here. The actual dispatching use to be done by experienced police and firefighters, but now they pay a fee per call dispatched to my center. I am an Outsource of them. However, we are not off-shored (and can you imagine?).

How can just-in-time and vendor-managed inventories add value to products for

Vendor-Managed inventory is where the company does not monitor their own inventory, instead the suppliers monitor the companies inventory and ship as needed. This allows them to keep more track of what their actual demands are, as there is little surplus, allowing the customers to not only get a newer product that has not sat on the shelf for a longer period of time, but also allows them customize the final product more. Think of back to the Model T Ford. "you can have any color, as long as its black" People will pay more to be able to customize their products, that everyone else has. I own a Nissan Versa, and besides the personalization of stale french fries and car seats, I have placed other items on my car that makes my care more valuable to me, and less valuable to