What is Outsourcing? It is a method in which companies subcontract labor and support to outside agencies (Klepper, 1997). How, why, and who companies outsource to are quickly becoming social topics of discussion in our society. Everyone seems to have an opinion on outsourcing. I bet that I can walk into a social gathering right now and hear discussions like “outsourcing is good for the American consumer” or outsourcing takes jobs away from all of the hard working Americans.” In either case, outsourcing has raised great concerns over its effects on the American economy. In this paper, I will discuss the types of outsourcing, pros and cons associated with outsourcing, management views of outsourcing, employee views of outsourcing, and give my opinion of outsourcing.
What does outsourcing do? It enables companies to focus on the mission at hand, to save money and be competitive. Depending on a Company’s needs determines the type of outsourcing that company may use (Embleton, 1998). Outsourcing is a very diverse market, and there are many different outsourcing options from. Two common types of outsourcing I will focus on are Information Technology (IT) outsourcing and Business Process Outsourcing (BPO) (Bowen, 1998).
Through research, I found that Information Technology (IT) Outsourcing is a rapidly growing market. I.T. outsourcing enables companies to continue to manage their core business, while outside agencies manage their technology needs (Bowen, 1998). It’s a way of getting rid of those high paid, college graduated employees. I.T. outsourcing allows companies to use cost-cutting methods to cover computing needs, large mainframe and midrange data center, manage numerous networks and run desktops across the globe (Bowen, 1998). Advantages of outsourcing information technology include, but are not limited to, less capital expenditure, less management headache, and keeping focus on core competencies. Less capital expenditure means a company does not have to buy expensive hardware and software. Less management headache relieves companies of having to hire and manage accounting personnel. Keeping focus on core competencies affords companies’ time to strengthen and gain a competitive edge over the competition (DiRomualdo, 1998). Disadvantages of outsourcing information include less managerial control, may be more expensive, and Sec...
... middle of paper ...
...Workers in developing nations will get new and higher-paying jobs, and consumers in the U.S. will be able to buy products that are cheaper than if they were made at home. But is this really good for our society. We will soon find out.
Bowen. T and LaMonica, M. (1998). IT gets picky with outsourcing. Infoworld 20(33), 1-3
De Rose, L. (2004). The Downside to Outsourcing. Electronic Buyers’ News. July 14, Issue 1066.
DiRomualdo, A & Gurbaxani. (1998). Strategic intent for IT outsourcing. Sloan Management Review. 39(4), 115.
Earl, M.J. (1996). The risks of outsourcing IT. Sloan Management Review. 37(3), 26-33.
Embleton, P.R & Wright, P.C. (1998). A practical guide to successful outsourcing. Empowerment in Organizations. 6(3), 1-11
Hayes, R and Pisano, G. (1994). Beyond World-Class: The New Manufacturing Strategy. Harvard Business Review. 72(1).
Klepper, R & Jones, W. (1997). Outsourcing information Technology, Systems and Services. Prentice Hall.
Nicholas, J. (1998). Competitive Manufacturing Management (Singapore:McGraw-Hill). Chapter 19, Managing the Supply Chain, pg 672
Strassmann, P.A. (1995). Outsourcing: A Game for Losers. Computerworld. August 21.
Need Writing Help?
Get feedback on grammar, clarity, concision and logic instantly.Check your paper »
- 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]
1031 words (2.9 pages)
- 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]
1386 words (4 pages)
- The practice of outsourcing jobs is not a new concept. People have been outsourcing jobs for decades. Some people even offshore outsource jobs. There are many opinions to offshore outsourcing based on how it influences the economy. Some people are in favor of outsourcing jobs and some people are against outsourcing jobs. People need to get educated about the great impacts that offshore outsourcing does to an economy. The global economy has started to thrive and offshore outsourcing has profited the consumers as companies want to cut costs and competition, which is why I support offshore outsourcing jobs to foreign countries.... [tags: Outsourcing, Offshoring]
1873 words (5.4 pages)
- Today, many businesses have adopted the practice of outsourcing, be it within the borders or done internationally. Outsourcing can be defined as “the practice of having certain job functions done outside a company instead of having an in-house department or employee handle them; functions can be outsourced to either a company or an individual” (entrepreneur.com). “Outsourcing has become a major trend in human resources over the past decade. It 's the practice of sending certain job functions outside a company instead of handling them in house.... [tags: Outsourcing, Offshoring, Wage, Employment]
1200 words (3.4 pages)
- The Truth behind Outsourcing Outsourcing is when a company or business decides to contract part of their services that they do not do well to an outside company. There is two types of outsourcing offshoring and nearshoring. Offshoring is where a company outsources abroad and, nearshoring is outsourcing within the home country. The reasons that a company decides to outsource varies from company to company but, the most common ones are cost reduction, increasing globalization, growth , tax incentives, government support and access to new markets.... [tags: Economics, Inflation, Outsourcing, Unemployment]
1171 words (3.3 pages)
- 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]
736 words (2.1 pages)
- Nowadays, outsourcing is a viable expense sparing technique when used legitimately. It is now and again more affordable to buy an exceptional from organizations with comparative advantage than it is to prepare the great inside. As example of an assembling organization outsourcing might be Dell purchasing some of its components from an alternate producer to spare on handling expenses. Then again, organizations might choose to outsource book keeping duties to autonomous bookkeeping firms, as it may be cheaper than holding an in-house accountant.... [tags: IT, outsourcing]
2006 words (5.7 pages)
- In recent years, China's service outsourcing have been expanding from scratch, and gradually expand the field, scope of business mainly related to Information Technology industry, producing services, as well as cultural and creative industries, the target involving Japan, Korea, Europe, America and India. In Shanghai, Beijing and other cities formed a group of outsourcing industry cluster, with significant economic benefits of international service outsourcing park; local outsourcing companies grew rapidly, and gradually change the pattern of the first to foreign-based.... [tags: outsourcing, chinese, Globalization]
1008 words (2.9 pages)
- Offshore Outsourcing Currently, it has been reported that many of our jobs, as much as one out of every three private-sector jobs are being sent overseas. What is offshore outsourcing. Outsourcing occurs when a firm subcontracts a business function to an outside supplier. Outsourcing is mainly the result of companies who will always pursue the lowest-cost structure, which means less skilled work will move out of the U.S. to emerging economies. Many believes that this is a good thing, because living standards around the world will rise, and workers in developing nations will get new and higher-paying jobs, and consumers in the U.S.... [tags: Outsourcing Economics Economy Essays]
1674 words (4.8 pages)
- INTRODUCTION 3 THE HISTORY OF OUTSOURCING 4 HOW IS IT POSSIBLE. 6 WHY DO WE OUTSOURCE 10 WHO ARE WE OUTSOURCING 12 THE FUTURE OF OFFSHORE OUTSOURCING 13 CONCLUSION 16 BIBLIOGRAPHY 17 Introduction Offshore outsourcing is not a new practice in the United States. Offshore outsourcing of information technologies services, however, is relatively new to our nation. It is a hot issue in political debates, with this being an election year. Job loss and job creation in the United States is on the platforms of leading candidates.... [tags: Offshore Outsourcing Essays]
2542 words (7.3 pages)