...Business Process Outsourcing Introduction Business process outsourcing (BPO) is a subset of outsourcing that involves the contracting of the operations and responsibilities of specific business functions (or processes) to a third-party service provider. Originally, this was associated with manufacturing firms, such as Coca Cola that outsourced large segments of its supply chain. BPO is typically categorized into back office outsourcing - which includes internal business functions such as human resources or finance and accounting, and front office outsourcing - which includes customer-related services such as contact center services. BPO that is contracted outside a company's country is called offshore outsourcing. BPO that is contracted to a company's neighboring (or nearby) country is called near shore outsourcing. Often the business processes are information technology-based, and are referred to as ITES-BPO, where ITES stands for Information Technology Enabled Service. Knowledge process outsourcing (KPO) and legal process outsourcing (LPO) are some of the sub-segments of business process outsourcing industry. In 2010, the Philippines surpassed India as the largest business process outsourcing industry in the world. After growing 20 per cent in 2012, the BPO industry of the Philippines is estimated to gross revenue of upwards to $25 billion by 2016. By these estimates, the Philippines' BPO industry will account for approximately 10 per cent of the nation's GDP. History...
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...Minicase: Can Brazil Become a Global Competitor in the Information Technology Outsourcing Business? 1. Use the theories of international trade and investment that have been presented in this chapter to help explain Brazil’s intentions and actions regarding the international information technology sector. The IT Service industry has expanded rapidly. Many companies worldwide have made the decision to outsource this industry to offshore companies. Worldwide demand has increased growth to 40 to 50 percent on an annual compounded rate basis. Many developing nations like Latin America and Asia have made an attempt to obtain some of the IT offshoring business from countries like the United States because it is seen as not only a source for skilled labor but an opportunity to improve the economy. Brazil has steadily become a strong competitor in the IT offshoring sector for a number of reasons. Brazil is the 11th most powerful economy in the world and has a high-rated and technologically advanced telecommunications system and network services infrastructure. In fact it has been rated higher than even China in terms of reliability. Brazil also has many solid engineering schools, which are producing many quality tech graduates. Brazil also boasts a sophisticated banking sector along with an effective marketplace for IT software and support services. Real Estate is also quite affordable for corporate undertakings. Brazilian wages are typically 40 percent of those for the same...
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...that Business Process Outsourcing would have improved Wal-Mart’s profits? Justify your answer. Introduction: Nowadays, outsourcing firms are emerging like mushrooms across the globe. Outsourcing is a journey of two organisations seeking jointly to overcome predictable challenges (Nakkiran S John; Franklin D, 2005). BPO stands for ‘Business Process Outsourcing’ which is the process through which one company hands over part of its work to another company, making it responsible for the design and implementation of the business process under strict guidelines regarding requirements and specifications from the outsourcing company (Destination India, 2009). Today anything that can be outsourced gets outsourced and BPO can include the following key functions: administration, finance and accounting, human resources, payment services, sales, marketing and customer care, supply chain management and software development among others. Almost every developing country in the world today has its Business Process Outsourcing companies that not only accommodate the outsourcing needs of the local industry but astonishingly offer business processing services to other foreign countries as well. Wal-Mart is one of the largest companies in America and its reputation is based on its strategies to minimize operating costs and maintain low prices which attract most of its customers. In today’s challenging business environment, many companies are looking for ways to restructure business processes...
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...Recently business are moving across the globe to third world countries to produce their products for half the cost. This has caused a debate amongst American citizens. Many people are against outsourcing, simply because it leads to unemployment increasing in America, yet allows foreign country’s residents to obtain jobs. Outsourcing is usually done by large companies, mostly because it is cheaper to get the job done in another country than it is to have it done here, due to the fact that workers in America are often paid more for the same task than workers in foreign countries, like India. On the contrary, many corporations believe that in the long run, outsourcing can benefit the American economy. That by outsourcing to non-developed or developing countries, we enable them to improve their economies. That by exporting products and services to be made in foreign countries we are lowering the prices of those products and services to be made in foreign countries we are lowering the prices of those products for the American people, and at the same time helping foreign nations. Industries and companies are reaching out across the world. Capgemini, a French IT company has branched out to many different countries over the years. Sodexo, another French company, is a global food service industry, expanded to countries such as the United States, Africa, and other countries. Computer Science Corporation started in the United States and has expanded to nations around the globe. Intercomp...
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...Outsourcing Teresa McGlown BUS 630 Wendy Achilles 08/27/2012 Table of Contents Introduction 1 Forms of business aspects covered by outsourcing 1 Outsourcing with reference to Hechlinger, J. Article 2 Other articles highlighting the application of new learning with respect to outsourcing 3 Dean Meyer’s Article highlighting the advantages of outsourcing 3 Sholstica’s Article highlighting the disadvantages of outsourcing 6 Present and future application of outsourcing within workplace 6 Conclusion 7 References 8 Outsourcing Introduction In the present dynamic environment, one way the companies can gain competitive edge over their competitors is by taking full advantage of all the business aspects. One of such possible aspect of performing organizational activities in an efficient manner is through the platform of outsourcing that provides a company an opportunity to hire an outside firm having proficiency in a particular field and then getting some of the organizational tasks completed through this hired firm either at a reduced cost or an increased productivity rate. A number of factors (both related to internal and external environment) are considered that helps to decide that whether outsourcing is a right answer for a particular company. The process of outsourcing facilitates learning of a number of aspects that if properly applied within an organization can serve as a competitive element for the company, enabling them to remain a competitive force within...
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...“Outsourcing-Offshore” Outsourcing is said to have emerged a few thousand years ago with the production and sales of food, tools, and other household appliances. As soon as small communities and societies began to form, people with specialized professions began to trade with each other for goods and services. It can be said that each worker was outsourcing some activities to others. Research shows that even in the industrial age, a few thousand years later, very few companies outsourced any of their operations. Companies in the 1800s and 1900s were vertically integrated organizations, taking care of their own production, mining, and manufacturing from raw materials to finished goods as well as then shipping the goods to company owned retail outlets. These companies often handled their own taxes, employed their own lawyers, as well as designed and built their own buildings without outside assistance. This model does not apply to all companies during that time period, but it gives a general idea of the time. The history of outsourcing portrays that as onshore outsourcing continued manufacturing outsourcing of low-tech items such as toys, shoes and apparel goods began to take place. After this manufacturing higher value items like high-tech components and consumer electronics began to appear. In fact outsourcing history demonstrates that manufacturing was the first activity that began to move to offshore destinations in a quest for lower costs. Globalization began during...
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...and a business proposal? What are the similarities? This paper will compare and contrast the theoretical and practical differences between formal research and a business proposal. The second part of this paper will explore the effects of human resources outsourcing on leadership performance and employee commitment. This paper will show that human resources outsourcing has a negative effect on employees and their morale. Part 1 Formal research provides basic information and statistics in a given field or industry depending on the focus of the research. Formal research may be used to research the demand for a specific product or service by researching similar products or services that are already on the market. Included in this research would be the general sales rate, the companies that market these products or services, and the current sale price. Research will reveal whether the market for the product is flooded or if it is indeed a good business opportunity. A business proposal is a document that proposes a method for completing a task. A business proposal can be used for launching a new product or for something like implementing a new strategy for a marketing campaign. “A proposal includes a brief description for the task at hand, a section describing the general approach to the task, a schedule for the task in question and a budget that outlines all expenses associated with the task” (Jane, M., 2013). Formal research is the theoretical approach while a business proposal...
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...Abstract This paper will discuss what outsourcing is about and the impact of outsourcing information technology to China. It will take a look at the benefits, challenges and risks faced when a company makes the decision to outsource their information technology functions to China. As globalization accelerates and competition intensifies, outsourcing has become a strategic solution for many corporations and governments around the world. More companies are outsourcing their goods and services to other countries. It has become a way for many companies to gain cost savings, increase productivity by outsourcing their information technology goods and services. Outsourcing of information technology services is one area that companies are taking more and more advantage of. Companies that outsource see increase productivity and quality improvement in their information technology services. China is starting to make advancements in their information technology outsourcing services, in the goal of one day being the number leader in this outsourcing area. Outsourcing Information Technology to China The world of outsourcing continues to grow with different goods and services being sent to other countries. Outsourcing of goods and services has been around for some time now. According to Patterson, Gott & King (2011), “IT and BPO offshoring are early manifestations of a larger trend that, in the long run, means that more functions can and will be located outside the countries...
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...document.] | Contents 1. Definition of outsourcing 3 2. Functions outsourced by HR 3 3. Advantages of outsourcing HR Functions 4 3.1 Managing and minimising risk 5 3.2 Cost Savings 5 3.3 Efficiency and economies of scale 5 3.4 Professional Expertise 5 3.5 Improved Employee Morale 6 4. Disadvantage 6 4.1 Poor Performance and decline in quality 6 4.2 Distance and lowering moral 6 4.3 Recruitment Problems 6 4.4 Leak of important internal information 6 4.5 Perceived loss of power and control 7 4.6 Increased Direct Costs 7 5. e-HRM 7 5.1 Objective of e-HRM 7 5.2 Advantages of e-HRM 8 5.3 Disadvantages of e-HRM 8 6. Conclusion and Advice to the Client 8 1. Definition of outsourcing The Human Resource department is considered to be one of the highly accredited departments of the organization; these are the people who provide the working resource to the company and keeping the company afloat even in the worst economic downtime. The best way in which the HR can be managed is decided by the HRD. The ways in which the human resource management is done has changed considerably in the recent years. The HR activities and functions can now be delivered, not only by the specialised Human Resource professionals, but also through outsourcing (Ulrich 1996; Tremblay, Party and Lanoi 2008). The HR outsourcing can be defined as the purchasing of the HR functions and services from a third party supplier. HR outsourcing can also be defined as the process of...
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...INTRODUCTION Information Technology (IT) outsourcing is the contracting out of part or all of an organization's IT activities (Duarte & Snyder, 2006). Global Tech Corporation is an Information Technology (IT) outsourcing firm that provides help desk and customer support functions. Global Tech specializes in taking the work that other companies do not have the resources to complete on their own and helps them to get the jobs completed. Product deliverables include software consulting, website design and maintenance, e-mail servers, help desk and customer support functions. The company is headquartered in the United States, and has four branch offices in China, India, Philippines and Ireland. In order for Global Tech Corporation to function profitably all over the world the company must learn what the cultural barriers are in each country they have an office located, what leadership barriers there are and what leadership styles would work best in each country. The following will discuss how Global Tech has overcome cultural barriers, the organizational makeup, leadership styles, and production of the corporation. ORGANIZATIONAL DESCRIPTON When entering the corporate world in the 21st century it is important to realize that we are at an incredibly turbulent part in history. The world is experiencing natural disasters, wars, terrorism, approaching limits on natural resources. It is not an easy time to enter the global landscape and try to be a competitive company; however...
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...HR OUTSOURCING HR outsourcing is the process of sub-contracting human resources functions to an external supplier. Different HR functions that can be outsourced: One can outsource various HR functions depending upon the expertise required. Recruitment is unarguably the most common functions outsourced. However, it is functions like payroll, leave tracking, record keeping, etc. Recruitment: Outsourcing recruiting makes a lot of sense. The organization will always have the final say in the selection of the candidate, but the screening of resumes, and initial selections can be completely outsourced. Then there are also entrepreneurs who believe that recruitment should never be outsourced to an external party as they cannot fully understand the culture of your organization and will fully understand your requirements. Administration: This includes maintenance of employee master payrolls, tracking of leaves, any kind of employee redressal and grievances, entry and exit process, paying provident fund and life insurance, and so on. These are people- and effort-intensive activities that can be mastered over a period of time. This is the reason why it makes sense to outsource it to a service provider. Strategy: This includes setting up a performance management system, building an employee handbook, and undertaking activities that offer value addition for employees. A number of strategic drivers for outsourcing HR services are: 1. Reduced cost 2. Increased efficiency ...
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...What is Outsourcing? Outsourcing refers to the way in which companies entrust the processes of their business functions to external vendors (Dinu, 2015). At times, an organization cannot handle all aspects of a business process internally while focusing on their core competencies. There are necessary functions that an organization would prefer to outsource. Once the function is outsourced to the service provider, they will take ownership and risk to manage the function as agreed upon by both parties. According to much of the literature and research on case studies, Figure 1 details the most commonly outsourced activities (Hoecht, & Trott, 2006). IT Outsourcing Legal Outsourcing Content Development Web Design and Maintenance Recruitment Logistics and Distribution Services Manufacturing Technical/Customer Service Human Resources Services Sales and Marketing Finance and Accounting Services Procurement Services Computer Programming Services Tax Compliance Training Administration Transportation of Products Benefits and Compensation Planning Payroll and Human Resource Functions Figure 1: The most commonly outsourced activities. Why Outsource? When an organization is considering outsourcing, they must weigh the efficiency of performing the activity internally versus the external vendor’s efficiency and evaluate the risk associated with the decision. The organization must consider both strategic and operational issues related to the decision to outsource. Greaver (1999)...
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...Running head: FACTS ABOUT OUTSOURCING 1 The Facts about Outsourcing Lawrence Smith Professor Barron Columbia College FACTS ABOUT OUTSOURCING 2 Abstract Globally, businesses have undergone unprecedented changes because of technology, the internet, and improved educational systems around the world. There are so many moving parts to having a successful business; nowadays, many organizations are outsourcing their non-core activities to external agents. Outsourcing is becoming an increasingly accepted practice for both small and large businesses of today. Outsourcing has quietly grown into a standard operating procedure for many organizations. This rising use of outsourcing represents a paradigm shift in the way companies conduct business. In today’s business environment, every company is looking for ways to reduce costs. Many are now turning to outsourcing as a weapon in their cost-cutting arsenal. But outsourcing is about more than shrinking budgets and reducing headcount. This paper will explain the term outsourcing and address why organizations prefer to outsource some of its functions in today’s business environment. Also, discussed in this paper will be the advantages and disadvantages of the outsourcing process and its rewards and risks towards the organization. FACTS ABOUT OUTSOURCING 3 The Facts about Outsourcing The word outsourcing could be described as the contractual relationship with a specialized outside service provider...
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...Outsourcing is an important part of Globalization. The choice to outsource U.S. jobs should be taken into great consideration as there are many segments into which it effects greatly. Also, outsourcing is a great option for a company who needs a certain project completed who do not have the man power or the money to hire a new employee, companies can outsource based on projects in the U.S.A. or abroad. Often outsourcing is a way to save money, but there can be unexpected costs as well. While it can be both a benefit to a customer it can also be a reason to avoid doing business with a company due to it. The decision to outsource is certainly not one that any organization should enter into lightly. There are many reasons to consider outsourcing to foreign countries. A few of the most significant advantages of outsourcing include the most well-known reason to consider outsourcing is to access cheaper labor. Workers in developing countries are paid far less than workers in developed countries due to the lower cost of living. Often these workers are not unionized as well, which further helps with cost cutting. At the same time outsourcing U.S. jobs to a foreign country can create a detrimental blow to the reputation of a company. In 2002 when T-Mobile was established the television spokesperson was Catherine Zeta Jones, a very classy and beautiful actress. Customer service call centers were based in the United States and there was never an issue that could not be...
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...Running head: Outsourcing Characteristics Outsourcing Characteristics Name CMGT 578 23 September 2013 Professor Scott Goodman Outsourcing Characteristics In this paper, the Outsourcing features will be talked about in great deal and the features will consist of what are the influential aspects in a company determining to outsource. One reason that most companies select to outsource is that they have a prospect to reduce needless expenditure. In addition, the risk engaged in outsourcing will also be reviewed, this risk is that company information is no longer confidential and the partners you selected to outsource currently to have access to all the company information. Faith and professionalism is significant in selecting to outsource to a partner. The advantages of outsourcing will also be conferred in this paper as well. I will explain in detail the method following outsourcing and the company following outsourcing. When establishing whether a company is supposed to, they contemplate many elements and one may be nothing, but the cost cutback. This also has an effect on estimate timelines, project timelines are decreased and the labor cost is cheaper. Many companies that decides to outsource their business because the pay rate is considerably lesser in the region where they would contract out their job. Another deciding element is in the assessment to subcontract the company, they do not have to employ consultant or experts...
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