Outsourcing and Third Party Companies Essay

Outsourcing and Third Party Companies Essay

Length: 2026 words (5.8 double-spaced pages)

Rating: Term Papers

Open Document

Essay Preview

Outsourcing relates to a firm contracting with another firm to provide products or services which could otherwise be made in-house. The contracted third party company takes control of the work and it is accountable for the success of the work assigned. Many organizations today outsource services such as electronic mail services, payroll, and customer care call center services. A firm contracts with a company that has specialized in production or provision of a given service, where in many cases the company is located overseas. Having looked at what is all about outsourcing it is important to note that; a business outsources a job that it considers not to be the core business of the company. An insurance company for instance outsources its landscaping operations to companies that are experts and specialists in that job. The service providers where jobs are outsourced are referred to as third parties (Sourcingmag.com 2011).
To help an organization make outsourcing decision, it should ask the following questions; after outsourcing, will the company be free to concentrate on its core activity? Will the company’s efficiency be achieved when the organization outsources? Will outsourcing help the company gain a competitive position? Among other strategic concerns (Crown 2011).
Outsourcing takes place in different firms and the most common include, outsourcing of information technology (ITO), outsourcing of business processes (BPO), which encompasses outsourcing of human resource (HRO). ITO is where a business firm outsources services of computer technology from a third party company. BPO encompasses HRO which relates to outsourcing of customer care call centers services from a third party instead of doing it on its own.
Companies out...


... middle of paper ...


...bm.com/press/au/en/pressrelease/28347.wss
MDF Systems, 2004. 32 Benefits of Outsourcing.
Retrieved from: http://www.mdfsystems.com/artman/publish/article_19.shtml
Onwards Vortex Centrum Limited and Group companies, 2011. Outsourcing: Qantas in seven
year deal with IBM. Retrieved from: http://chiefofficers.net
Qantas Airways Limited, 2011. Our Company. Retrieved from:
http://www.qantas.com.au/travel/airlines/history/global/en
QuinStreet Inc., 2011. IBM Puts Qantas' IT Business in its Pouch.
Retrieved from: http://www.internetnews.com/xSP/article.php/3354841/IBM-Puts-Qantas-IT-Business-in-its-Pouch.htm
Sourcingmag.com, 2011. Outsourcing - What is Outsourcing?
Retrieved from: http://www.sourcingmag.com/content/what_is_outsourcing.asp
UBM TechWeb, 2011. Airline Taps IBM for Flexible Pricing Deal.
Retrieved from: http://www.informationweek.com/news/20900330

Need Writing Help?

Get feedback on grammar, clarity, concision and logic instantly.

Check your paper »

The Advantages and Disadvanatges of Using Third Party Logistics Companies

- In order to improve operational efficiency, many companies have chosen to outsource part or all of their logistics activities to third parties. By doing that, company can focus more on its core activities. Green, Turner, Roberts, Nagendra & Wininger (2008) have found out that third-party logistics (3PL) companies typically offer services that cover warehousing, distribution, inventory control, packaging and transportation, such as contracting and procuring transportation procurement, managing inventories, consulting and managing logistics, auditing and consulting freights, tracking and tracing shipments and offering reverse logistics and other value added services....   [tags: outsourcing, collaboration, planning]

Term Papers
979 words (2.8 pages)

Essay about Outsourcing : Outsourcing And Outsourcing

- Outsourcing has been a topic of much discussion for decades among scholars, business people and employees who work for companies that often outsource many of their daily functions. Outsourcing takes away jobs from employees and leaves the impression that the company is greedy by trying to save money instead of keeping the jobs within the organization. When did outsourcing develop into the thing to do in organizations. Outsourcing started in the early 1970’s as a business strategy that allowed companies to focus on their core competencies while other functions are handled by providers with expertise (Davis & Davis, 2012)....   [tags: Outsourcing, Management]

Term Papers
1031 words (2.9 pages)

Outsourcing And Outsourcing : Outsourcing Essay example

- Outsourcing and offshoring have been increasing in their magnitude greatly in the recent past (see graph below). In this essay, I intend to examine both the positive effects and negative effects that this increase in outsourcing and offshoring is having on developed countries such as the UK and the US. I will achieve this goal by first defining and differentiating outsourcing and offshoring before moving on to examine the motivations for each of these phenomena they I will examine the effects on growth employment and skills in these economies before wrapping it all up in a conclusion about the overall effect of outsourcing and offshoring....   [tags: Employment, Minimum wage, Outsourcing, Economy]

Term Papers
1386 words (4 pages)

Importance if Third Party Logistics Essay

- Executive Summary The performance of the logistics system has a major impact on cost structures, revenues, service quality, and competitiveness in Australian industry. Logistics activities have been evolving rapidly in response to changes such as globalization, general industry restructuring, new production processes, and technological advances. Many firms, government agencies and joint industry/government bodies are developing programs to improve logistics performance in Australia. The initiatives include the Freight Transport Logistics Industry Action Agenda....   [tags: 3pl Third Party Logistics]

Term Papers
1851 words (5.3 pages)

Outsourcing Financial Services : Outsourcing Essay

- Outsourcing financial services is a risk that can endure expensive losses. A company can easily lose control of operations and lead itself away from its goals. Loss of controls on company activities and services can occur without proper coordination and communication. Financial firms that outsource their activities must have trust in their third party. The third party should be aware of what needs to be accomplished, and in what period of time. Without coordination, a company loses valuable time and money....   [tags: Economics, Financial services, Outsourcing]

Term Papers
736 words (2.1 pages)

The Impact of Outsourcing Essay

- Outsourcing has only very recently become an issue in the United States, and as a result it has become a very popular political issue during campaigns for presidency. Outsourcing is the idea that a company will subcontract to a third party, usually outside of the US, for various parts of its business structure. An example of this and perhaps the largest source of outsourcing is call centers for tech support, where a company will subcontract to a third party and that party will build up the call center and hire the workers for it....   [tags: Business Management, Globalization]

Term Papers
1771 words (5.1 pages)

The Pros and Cons of Outsourcing Essay example

- 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. Outsourcing is important because many companies rely on it in order to get many different products and services to their facility on time and in good shape. Outsourcing is a huge part of the business industry today. Any business can be affected by outsourcing. No matter how big or small a business is a business is able to outsource services that they could not do profitable on their own....   [tags: Globalization Essays, Outsourcing Essays]

Free Essays
1607 words (4.6 pages)

IS/IT Outsourcing Essay

- Competitive advantages are gained by a company by providing real or perceived value to customers. To determine how IT can provide a competitive advantage, the firm must know its products and services, its customers and competitors, its industry and related industries, and environmental forces, not to mention the insight about how IT can enhance value for each of these areas. To understand the relationship of IT in providing a competitive advantage, consider the potential of a firm’s IT resources to add value to a company or profits....   [tags: competitive advantage, cost reduction]

Term Papers
918 words (2.6 pages)

Business Process Outsourcing Essay

- The trend in the world of business grows rapidly. Historically, it is difficult to find the best solutions for the common issues in business such as quality, cost and innovation. Nevertheless, business experts have reacted by implementing strategies. One of these strategies is "the farming out of services to a third party" (Overby 2007), which is called outsourcing .According to The Daily Telegraph (2007), worldwide outsourcing is now valued at approximately $US4 trillion. Originally, it was thought that only IT management could be outsourced....   [tags: Globalization Business Offshore Outsourcing]

Term Papers
1337 words (3.8 pages)

Essay on Outsourcing

- Outsourcing Thesis: How outsourcing jobs has affected IBM’s Human Resource Management Department I. What is outsourcing A. Factory work to outside contractors B. Management responsibilities C. Human Resource Management duties II. Why use outsourcing A. Reduction in labor force B. Saving’s factor C. Technological advantages D. Increase customer satisfaction III. Winners A. Stockholders B. CEO’s C. Clients D. Outside contractors IV. Losers A. Local employees I. Families B. The community Conclusion - - Outsourcing is not the solution for all of corporate America, but for IBM it is the only profitable way to operate....   [tags: IBM Computers Technology Essays]

Term Papers
1522 words (4.3 pages)