Offshore Outsourcing

1451 Words3 Pages
bulb-icon

Recommended: Outsourcing advantages and disadvantages

Outsourcing is simply the farming-out of services to a third party. Offshore outsourcing is majorly used in IT related task for which internet plays a vital role along with work related to sales & marketing, finance, human resource & administration, etc. Quality and effective risk management are two integral parts of offshore outsourcing services. Offshore outsourcing allows businesses to reduce costs, gain staffing flexibility and increase revenue, gain competitive advantage, decrease cycle time, increase shareholder value, improve customer loyalty and ultimately allows a business to focus on its core competencies. An example of offshore outsourcing is the very well known clothing based company called Gap Inc. which outsources its production from Indonesia to reduce its cost & to gain an advantage in the global market.

WESTERN COMPANIES:

Brands like Armani, Polo, Nike, GAP etc. have their manufacturing unit in emerging markets like India, China, Thailand, etc. Cost reduction is one of the major reasons for western companies from U.S.A., U.K, France, countries to opt for outsourcing. Outsourcing of activities incurring high indirect costs generate cost reductions. Costs incurred for recruiting, motivating and training of staff is reduced due to the difference in value of currency. One such company is Louis Vuitton, a French brand outsourcing its processes from emerging countries like India & China. The time difference between the companies enables the production to be carried 24/7. Outsourcing enables redistributing resources to the core areas within the company that have direct impact on profitability. Countries where the taxation & government regulations are unfavourable, explore to other countries where the sam...

... middle of paper ...

...cing Explained. Available: http://ezinearticles.com/?Meaning-of-Offshore-Outsourcing-Explained&id=3675615. [Accessed 13th March 2011].

• McDaniel,R. 2010. The Advantages of Outsourcing for Nike. Available: http://www.ehow.com/list_7704795_advantages-outsourcing-nike.html. [Accessed 18th March 2011]

• Needle,D. 2004. Globilation . In: Paoli,L. and Cooke,A. Business in Context. 5th ed. Hampshire: Rennie,T. PP.22-23.

• Publisher. 2009. IBM and Microsoft Virtualization. Available: http://www.microsoft.com/virtualization/en/us/partner-profile-ibm.aspx. [Accessed 16th March 2011].

• Overby,S. 2007. Outsourcing Definition and Solutions. Available: http://www.cio.com/article/40380/Outsourcing_Definition_and_Solutions#1.[Accessed 17th March 2011].

• Verticals . 2008. Shifts of Jobs. Available: http://www.bpowatchindia.com/BPODemystified.html. [Accessed 17th March 2011].

Show More
Related

  • Outsourcing in Intercollegiate Athletics

    948 Words  | 2 Pages

    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 (...

    Read More

  • Hyper-Competition and Its Relationship to Organizational Structures

    1079 Words  | 3 Pages

    www.businessdictionary.com *David Boddy, 2008. Management; An Introduction. Chapter 10, pg322 - 324

    Read More

  • Outsourcing: Pros and Cons

    527 Words  | 2 Pages

    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?

    Read More

  • Outsourcing as a factor in the United States recession

    660 Words  | 2 Pages

    Outsourcing is a complicated and a multifaceted subject that involves a “business[’s] purchase of parts or labor from another company rather than maintaining a sufficient enough number of its own employees to do the same work in the country where the company is already based” ("Outsourcing"). The first practice of outsourcing was in medieval times when “nation-states called in soldiers-for-hire to help their own military forces during ongoing conflicts” ("Outsourcing"). Many think of outsourcing as a one way trade of production facilities moving outside of a companies locale but in actuality it is a two way trade that also involves companies from other areas moving their factories to local areas where conditions are beneficial for the specific business. Outsourcing has evolved but the main idea has remained the same. The recent increase in outsourcing “was initiated by Wall Street pressures on corporations . . . . for increased profits . . . in the production of goods and services marketed in the U.S."(Roberts).

    Read More

  • Martha Stewart Living Omnimedia Crisis Management

    1144 Words  | 3 Pages

    Knowledge Wharton. (2004, April 7). When the CEO is the Brand But Falls from Grace What’s Next Comments. Retrieved January 20, 2014, from http://knowledge.wharton.upenn.edu/article/when-the-ceo-is-the-brand-but-falls-from-grace-whats-next/

    Read More

  • Outsourcing and the US Labor Market

    1210 Words  | 3 Pages

    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...

    Read More

  • Types of Businesses in America

    1338 Words  | 3 Pages

    Pride, William M., Hughes Robert J., Kapoor Jack R. Business. Publisher: Boston: Houghton Mifflin Co. 8th edition.

    Read More

  • Business For the Glory of God

    1465 Words  | 3 Pages

    Grudem disbursed his time examining the different aspects of business partitioned into the following chapters: Ownership, Productivity, Commercial Transactions, Profit, Money, Inequality of Possessions, Competition, Borrowing and Lending, Attitudes of Heart, and Effect of World Poverty. At the introduction of eac...

    Read More

  • Outsourcing Information Security Consultants

    1798 Words  | 4 Pages

    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).

    Read More

  • The Outsourcing Trickle

    1236 Words  | 3 Pages

    As esteemed journalist Tom Piatak wisely puts it, “The trickle of outsourcing threatens to become a flood.” His words speak the truth as outsourcing has left United States’ workers jobless, and it continues to increase the unemployment rate every year. During February of 2009, American workers lost a record 651,000 jobs alone, increasing the unemployment rate to 8.1 percent, the highest it has been in 25 years (Katel). Multinational corporations, hoping to cut down costs and stay profitable in the market, outsource by exporting American jobs to third-world countries such as China and India. It may seem noble that outsourcing provides third-world countries with job opportunities, but the United States’ markets and industries are greatly affected. Outsourcing is harmful to the United States’ economy because it paves the way for job losses, decreases product consumption, and widens the gap between the rich and the poor.

    Read More

  • The Pros and Cons of Outsourcing

    1607 Words  | 4 Pages

    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.

    Read More

  • Harms of Swearing

    788 Words  | 2 Pages

    O'Connor, James V. "Business Edge, Volume 2, No. 21." Business Edge, Volume 2, No. 21. The Business Edge, Apr. 2000. Web. 11 Feb. 2014. .

    Read More

  • Global Supply Chain Management

    997 Words  | 2 Pages

    Outsourcing labor and materials in a global market can significantly stretch the supply chain structure. This can have both positive and negative effects. Looking to different countries provides the opportunity to access different markets and find the lowest possible manufacturing costs. Many companies also embraced the Toyota Motor Corp. model of just-in-time inventory and other lean manufacturing techniques that emphasized speed and cost reduction (Bosman, 2006...

    Read More

  • Corporate Social Responsibility Activities of Unilever

    3393 Words  | 7 Pages

    Worthington, I. and Britton, C., 2006. The business environment. 1st ed. Harlow: Financial Times Prentice Hall.

    Read More

  • Offshore Outsourcing Essay

    1873 Words  | 4 Pages

    What does it mean to offshore outsource? Let’s first start by explaining what outsourcing means. The basic meaning of outsourcing is to obtain goods or services from an outside place. This gives businesses and companies the ability to save money. When the businesses and companies save money that ultimately means the consumers will also save money. The word offshore means some distance from the shore. According to Blinder “Offshoring, by contrast, means moving jobs out of the country, whether or not they leave the company” (20). To better understand the meaning of offshore outsourcing, we can say that it is the process where the companies provide jobs to foreign countries. Big

    Read More

More about Offshore Outsourcing

Open Document