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The importance of cultural differences in international businesses
The importance of cultural differences in international businesses
How outsourcing affects the economy
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As Jim Pinto says in an article published on ISA, “…global outsourcing has a negative connotation—it means firing American workers and shipping jobs to less-developed countries where wages are low and labor laws are lax.” For these reasons, outsourcing has grown because companies believe they save money, time, and effort by moving jobs to other countries. However, outsourcing and offshoring jobs to foreign workers hinders the development and prosperity of companies
Because of outsourcing, many companies waste time and money trying to break through cultural and language barriers. For instance, while explaining why outsourcing was bad for a company, Passion Computing explains that it is difficult enough to translate programming concepts to clients and create achievable project goals without having to give clear instructions to Indian programmers who have a different grasp of English. Because people from other countries have a different way of speaking and understanding English, miscommunication causes projects to not be done correctly. Since the project might not be what the client asked for, the client stops working with the company. In addition to miscommunication, Passion Computing explains that trying to communicate to the client and then having to translate details to the Indian programmers is a problem in outsourcing. This situation is a problem because having to translate between languages causes time loss within a project. Because the project will then take longer, the client may stop working with the company out of frustration due to slowing project time. Furthermore, The Houston Chronicle publishes an article that explains that workers from Latin American countries often believe that asking questions of a supervisor is di...
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...ral & Language Barriers in the Workforce." Houston Chronicle. Hearst Newspapers, LLC, n.d. Web. 7 Mar. 2014.
Larson, Christina. "A Beijing Office Costs More Than Space in New York and Tokyo." BusinessWeek. Bloomberg L.P., 25 Feb. 2014. Web. 3 Mar. 2014.
Mitra, Sramana. "The Coming Death Of Indian Outsourcing." Forbes. Forbes.com LLC, 29 Feb. 2008. Web. 3 Mar. 2014.
Passion Computing. "Disadvantages of Indian Outsourcing." Passion Computing. Passion Computing Pty Ltd, n.d. Web. 27 Feb. 2014.
Pinto, Jim. "Global Outsourcing Has Downsides." ISA. ISA, n.d. Web. 07 Mar. 2014.
Rocks, David, and Nick Leiber. "Small U.S. Manufacturers Give Up on 'Made in China'" BusinessWeek. Bloomberg L.P., 21 June 2012. Web. 27 Feb. 2014.
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Globalisation is a growing phenomenon that is the result of various developments in the global environment, each of which merits an individual analysis of its social impacts. For the purpose of this analysis, the focus will be placed upon arguably its most controversial aspect, offshore outsourcing. Offshore outsourcing, or offshoring, is becoming an increasingly common business practice as a result of a combination of the recent technological advancements in the areas of transportation and communication, and the increased competitiveness of the business world. From the perspective of firms, tapping into cheap labor from less developed countries is a very logical business decision to reduce costs and maximize profits. This has not only motivated businesses to engage in offshoring, it has sometimes been critical to their survival in fiercely competitive environments.
Offshoring American jobs have positive and negative consequences to the American community. Some of those consequences of offshoring American jobs include Amer...
Mankiw and Swagel (2006) argue outsourcing is not as large a phenomenon as the media describes. Their research indicates outsourcing accounts for very little of job loss in the United States, nor has it made a distinct contribution to the slow rebound of the labor market. They go on to propose that increased overseas employment has actually contributed to higher employment in parent United States companies. They reported that while 30,000 jobs were lost per month in 2004, two million job changes per month were happening as well. They reference the Bureau of Labor Statistics when they report that in 2015 there are expected to be 3.4 million jobs outsourced, but 160 million jobs gained here in the United States. They also claim that there is a rise in net US income by 12-14 cents per dollar of outso...
For advocates of global business, the hope is that outsourcing will help lift the United State’s economic growth and development by lowering the input cost of services (i.e. labor and materials) and by opening new markets abroad. Mainstream economists believe that outsourcing will have ...
Outsourcing emerged on the financial arena during the 1980s and has since then been spreading. Outsourcing production was furthered with the process of globalization which provided a new component leading to the strengthening of resources, skill and labor specializations across the world. The process of outsourcing is using the skill and abilities of a third-party to accommodate society on the foundation of labor. As stated earlier, it was during the 1980s that the process kicked off mainly due to the efforts of corporations when they began to hire labor forces across the world. Even though outsourcing has come out from its developing stages, there are still following effects on the US economy.
As the problem of job outsourcing becomes more of an issue in politics, elected officials like the President and Congress will no longer be able to ignore the dilemma. The war in Iraq has been at the forefront of the presidential race but the importance of outsourcing American jobs seems to have been slightly overshadowed. If the issue of outsourcing is not watched carefully and a definitive plan hammered out, a trickling down of negative effects may occur within the U.S. economy. However, there is a polarized opinion on the effects of this “phenomenon”.
Outsourcing is obtaining goods or services from a foreign supplier in place of going in the country for these things. There are many debated effects of outsourcing on the economy, and there are several pros and cons to this practice. Even though there are many pros, the overall economy of America would be better off with minimal outsourcing.
With the United States’ economy in a depression and our unemployment rate skyrocketing to record highs, job-outsourcing has moved to the top of the list of controversial issues. Froma Harrop’s essay New Threat to Skilled U.S. Workers and Thomas Friedman’s essay 30 Little Turtles discuss two different viewpoints of job-outsourcing, and their effects on society. Does our government really want to cut back on job-outsourcing, and what can society do to help the issue? Friedman’s standpoint on job-outsourcing shows how it is emotionally beneficial to other countries and Harrop’s factual standpoint shows job-outsourcing regulation, however, I feel that our citizens are unaware of the opportunities and our government is eager to send the jobs overseas.
“Without warning, they left us broke, sealed out, and jobless” (Edwards). These are the words from Gregg Davis, a former Oshawa workman, after he received notice his job was being relocated to Nashville, Tennessee. Gregg Davis worked for IQT Solutions, a call-center company based in Oshawa, Ontario. Along with 600 other people, Gregg Davis was left jobless after his job was outsourced to Nashville, Tennessee in a desperate attempt to save the company money. Today, thousands of American workers are also waking up to the stunning situation of unemployment as the result of their jobs being outsourced to foreign countries. This outsourcing phenomenon has been fueled by the recent trends in globalization, with the hope to cut cost and increase production. Globalization was intended to benefit the world economy, but the wage difference among different globalized countries has promoted a negative aspect of outsourcing. If wage equality can be achieved among the countries, globalization’s full potential can be achieved.
Kesavan, R., Mascarenhas, O. A., & Bernacchi, M. D. (2013). Outsourcing Services to India: A Review and New Evidences. International Management Review, 36-44.
Outsourcing has been around for many years. In this paper I will discuss some of the history of outsourcing, the goods things about outsourcing, and the bad things about outsourcing.
In the late 1980's the rise of India outsourcing had its start. During this phase, India provided skilled contract workers for the US. Efforts to outsource projects to India arose in the late 1990's. This was driven by a combination of rapidly changing technologies and shrinking IT budgets Little by little the small offshore development projects started to multiply. In the beginning it was trial and error because there wasn't much focus on a repeatable and process driven model. During this time offshore outsourcing led to several failures. The big outsourcing force during the late 1990's came with Y2K. Work needed to get done quick and outsourcing to Indian companies was a solution to this. Indian companies had the ability to scale rapidly.
The way people communicate varies widely between, and even within, cultures. One aspect of communication style is language usage. Language has always been perceived as a link between people but it can also constitute a barrier. Across cultures, some words and phrases are used in different ways. For example, even in countries that share the English language, the meaning of "yes" varies from "maybe, I'll consider it" to "definitely so," with many shades in between . Furthermore, communication between cultures which do not share the same language is considerably more difficult . Each culture, has its distinct syntax, expressions and structure which causes confusion in intercultural communication. For example , in Asian countries the word “no” is rarely used, so that “yea” can mean “no” or “perhaps”. Therefore, an American traveling to Japan might be considered impolite if he ignores this rule. Furthermore, individuals who are not comfortable with a certain language may not be taken seriously. Such is the case in the classroom, where a student who has a perfect knowledge of the subject in question may have difficulty expressing his idea due to his inability to write properly and therefore he would not receive the grade he truly deserves. Similarly intercultural communication is dominant in the workplace. In the past, many companies and organizations could operate entirely within their country of origin and conduct their activities exclusively in their own native language. But now, due...
When Americans hear the word “offshore outsourcing”, they automatically assume that Americans are losing their jobs to foreign countries. Most of these jobs that companies outsource such as the garment industry jobs are offshore outsourced because they are labor intensive jobs. According to Timmerman
They were going to need the best technologies that were available to them. With the constant growth, Bharti needs a way to be competitive in the growing industry. Akhil Gupta, the former CFO and current managing director, recognized that the company was not able to handle its growth and maintain high customer service along with having to manage its ever-changing IT and network services. His proposed idea to handle the challenges Bharti was faced with in their IT and network services was to outsource those areas in which Bharti was not completely competent in. Could outsourcing be the way of the future for Bharti?