LITERATURE REVIEW
OUTSOURCING:
Outsourcing is a strategic activity in which some of the internal activities of the organisation are delegated to external firms because of various reasons such as:
- To bring in better focus for organisation
- To exercise better control over operating costs
- To get greater flexibility to define the requisite service readily available
- To sustain the same level of competency over a period of time
Usually the firms to which the activities are outsourced are specialized in their area of work and so the parent firm gets the advantage of getting the work done through competent employees. Therefore, outsourcing gives competitive advantage to the companies which can be easily sustained by them without much effort.
ADVANTAGES:
Expense reduction: Since outsourcing firms are specialized firms, they perform activities better, cheaper and faster as compared to the companies that perform these activities in-house. Cost reductions can also be obtained by combining activities. Specialised knowledge and expertise may be provided by outsourcing firms, thus eliminating the need to maintain such knowledge in-house where it may be used only occasionally.
Saves management’s time and efforts: Management can shift their time and efforts away from transactional tasks and focus on the core competencies that distinguish the organisation from its competitors. Repetitive problems become the responsibility of the outsourcing firm there by keeping the in-house management’s involvement to the minimum.
Increased organisational competencies: with reduction of time that is spent on day to day transactional tasks, more time and effort can be devoted to transformational activities that directly support the core competenc...
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...tsourced successfully.
Level 6: Highly Confidential Activities (HCA)
Secrecy is required in the performance of some human resource management activities. Layoffs, plant closings, and restructuring are examples of activities that must be kept confidential. These kinds of activities, obviously, have a much lower potential for being outsourced than those that do not have a need for secrecy or confidentiality.
Level 7: Management Decision Activities (MDA)
Some human resource management activities require the direct and specific involvement from top management. The structure of the human resource department or the direction the human resource function must take are examples of activities that require direction from top management. There is little opportunity for outsourcing decisions that must be made by the executive level of management in an organization.
Outsourcing simply means acquiring services from an external organization instead of using internal resources (Butler, 2000). By using outsourced resources, organizations can gain a competitive advantage by utilizing contingent staff to accomplish strategic goals without incurring the fixed overhead. By focusing on the leading edge and highly specialized skill sets, outsourcing providers can often offer higher quality services, or at a lower price than the client organization. Typical reasons for outsourcing go beyond simple contingent staffing. Outsourcing providers are able to maintain economies of scale with regard to specialization (...
Recently outsourcing has been in the news, especially during political election years. It seems to be a phenomenon that is causing much concern among the population. But exactly how is outsourcing effecting both workers and businesses? And is it as big of a problem as politicians describe?
Offshoring or offshore outsourcing is the practice of a company or a firm hiring or contracting in utilizing the services, skills or labor of the personnel from an outsourcing service provider that specializes in the need that they are looking for such as develop systems, customer service or even write code either from a developing or under developed countries, in their efforts to lower their operational costs and improve their service efficiencies and quality of their products. The former company is called ‘the Outsourcer or the Client’ who pays the money for the services obtained and the later company is called ‘the Outsourcee’ for providing the services to the outsourcer.
Q: Which of the following two concepts is more critical for international Human Resource Management: understanding the cultural environment or understanding the political and legal environment? Why? Include key terms and concepts from the textbook.
In many cases outsourcing has proven to be beneficial for businesses. It can help a business’s management by allowing executives to focus on the core structure of the firm rather than every specific element. Production, manufacturing, or additional servic...
Outsourcing is a technique for companies to reassign specific responsibilities to external entities. There are several motivations for outsourcing including organizational, improvement, cost, and revenue advantages (Ghodeswar & Vaidyanathan, 2008).
The competitive advantage that can be gained by the companies through IS/IT outsourcing is Improved business processes. IT outsourcing an identification method and rigor of IT resources that can help the business run smoothly. It can control the development of the project budget and expenditures. It also can promote information technology investment proposals from outside and provide skilled individuals in managing IT resources available in the company. Through these companies are able to provide appropriate information and report to the company. This can give competitive advantage to the company. For example, expenditures, progress, and issues the company can be viewed and controlled.
Outsourcing has been around for many years. In this paper, I will discuss some of the history of outsourcing, the good 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.
Apparently, offshore outsourcing strategies assist the company to reduce costs. Moreover, it will lead the company achieve its goal and increase its profitability. It assists the organisation to not only cut down costs but also can concentrate on improving its services as NBN requested $3 billion to investment for improving network. In addition, the Shareholder will get their interest which might be increasing.
To fully take advantage, the company needs to better understand its expectations on the subject, its obligations, along with its constraints and desires. It is therefore proper diagnosis of its needs can be acheived by asking the right questions. Many outsourcing operations prove to be a failure (Barthelemy, 2003; Bryce & Useem, 1998; Embleton & Wright, 1998). Many organisations are barely aware of the process that they initiate when they decide to outsource (van Engelen, 2005). Internal HR staff devotes only a fraction of its available time to the management of external relations and the monitoring of providers (Lepak & Snell,
...urcing services, the company operation will be became a mess. This is because one organization can’t run a lot of task or project at one time. Therefore an organization need outsourcing in the way to help their organization run smoothly.
Torrington, D. Hall, L. & Taylor, S. (2005) Human Resource Management. Harlow: Financial Times Prentice Hall
Human resource management (HRM) encompasses the activities of acquiring, maintaining, and developing the organization's employees (human resources). "The traditional view of these activities focuses on planning for staffing needs, recruiting and selecting of employees, orienting and training staff, appraising their performance, providing compensations and benefits, and making their career movement and development." HRM involves two aspects:...
A disciplined approach to management eying leading employees, improving the management team and building the business strategy. Instead of treating each problem as a one off. They design systems and structures that make it easier to handle in the future. (Techrepublic, 2015) 2.2. Risk of exposing confidential data: When an organization outsources HR, Payroll and Recruitment services, it involves a risk if exposing confidential company information to a third-party Synchronizing the deliverables: Some of the common problem areas include stretched delivery time frames, sub-standard quality output and inappropriate categorization of responsibilities. At times it is easier to regulate these factors inside an organization rather than with an outsourced partner Hidden costs: Although outsourcing most of the times is cost-effective at times the hidden costs involved in signing a contract while signing a contract across international boundaries may pose a serious threat Lack of customer focus: An outsourced vendor may be catering to the expertise-needs of multiple company at a time. In such situations vendors may lack complete focus on your organization 's tasks. 2.3. 1.Know the
Whether an organization consists of five or 25,000 employees, human resources management is vital to the success of the organization. HR is important to all managers because it provides managers with the resources – the employees – necessary to produce the work for the managers and the organization. Beyond this role, HR is capable of becoming a strong strategic partner when it comes to “establishing the overall direction and objectives of key areas of human resource management in order to ensure that they not only are consistent with but also support the achievement of business goals.” (Massey, 1994, p. 27)