...Eric Newton 11/29/14 To Offshore or not to Offshore Outsourcing is a method that is becoming more of a normal business technique each and every year. The root definition of outsourcing is to transfer different operations of business to outside suppliers that provide lower costs. Examples of this would be companies giving an independent accounting firm the right to maintain their books because it may be cost beneficial as opposed to hiring an accounting department. A real life example would be Apple obtaining computer chips from their rival Samsung instead of making their own. In the last couple of decades, many more companies have been utilizing a different form of outsourcing, that is offshoring. Offshore outsourcing is essentially just outsourcing, in different countries where the quality of work may be better or cheaper. Larger companies typically use offshore outsourcing because the cost of transporting items or products overseas wouldn’t seem as material as would with a low-income company. Some different types of offshore outsourcing are manufacturing, research and development, accounting, human resources, and more (IWDRO). One of the more common types is manufacturing, and it is also one of the more controversial because some major companies such as Nike have been known to take advantage of the cheap labor overseas by not obliging to the human rights standards. Is it ethical for companies like Nike to overload all of the dirty work (manufacturing)...
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...The lesson we can derive from this case is that outsourcing is not just a wage difference between two places but skills and attitudes. Finally, there are a large number of US companies buying professional services from Asian countries. Clearly, skilled workers will be found and hired wherever they are. Countries, such as, India, Pakistan and China are good labor pools (Prahalad 2005.) It follows that multinational and global companies will find skilled labor overseas and start operations or buy services in foreign lands. Qua hay The influence of outsourcing should be recognized. Whirlpool, for instance, has a global network, supplies washing machines from Germany, and microwave ovens designed in Sweden that are and made in China while other appliances come from Brazil. Global companies develop first-rate centers of production and design in various countries. Countries that are abundant in human capital with a supplier base have a chance to become first-rate centers. Within this framework, designed to promote a global network, financing depends on corporate profits and funds owned by prospective partners. Du Pont, for instance, raises funds through joint ventures but retains corporate control by retaining at least 51% of the share. The importance of outsourcing and globalization is that some market imperfections are removed. When imperfections are removed, prices converge. This means that factor price differentials in...
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...: http://definitions.uslegal.com/m/monetary-instruments/ What is Laundering of Monetary Insruments? Money laundering refers to a financial transaction scheme that aims to conceal the identity, source, and destination of illicitly-obtained money. The money laundering process can be broken down into three stages. First, the illegal activity that garners the money places it in the launderer’s hands. Second, the launderer passes the money through a complex scheme of transactions to obscure who initially received the money from the criminal enterprise. Third, the scheme returns the money to the launderer in an obscure and indirect way. Tax evasion and false accounting practices constitute common types of money laundering. Often, criminals achieve these objectives through the use of shell companies,holding companies, and offshore accounts. A shell company is an incorporated company that possesses no significant assets and does not perform any significant operations. To launder money, the shell company purports to perform some service that would reasonably require its customers to often pay with cash. Cash transactions increase the anonymity of customers and therefore decrease the...
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...negligible and margins and profits hit record lows, a modest improvement was seen in 2010. It seemed at first that this recovery would continue in 2011. But, after a good start, the industry suffered from a difficult second half: markets fell and profits stagnated at low levels. The situation has not yet improved in 2012; another good start was wiped out in the second quarter. Given the continued growth in global wealth, this implies that private banks are failing to capture their fair share of the market. The longer-term structural changes caused by the crisis are creating a much more demanding environment for private banks. Slower wealth generation in developed markets means that the growth momentum on- and offshore is shifting to clients in developing markets. Offshore growth has stabilized thanks to ultra high-net-worth (UHNW) and emerging markets clients. To maintain their position, let alone embark on a quest for growth, banks will need to adapt...
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...the Tax Office to divulge the details of customers with offshore structures. ''We recently complied with an order to provide the ATO with the details of all customers with a connection to Australia in various offshore jurisdictions,'' said Stephen Ries, a spokesman. Ashurst (formerly Blake Dawson) says it is its clients' responsibility to ensure they're meeting their tax obligations. ''Our firm actively advises our clients to comply with all applicable taxation laws and regulations,'' said spokesman Glenn Taylor. ''Some clients will establish international structures for a wide variety of legitimate business reasons and, on occasion, they seek our help to assist with this,'' he said. But confidential documents reveal that the secrecy of offshore accounts was paramount. File notes for the late John Anderson, a senior partner with accountancy firm KPMG, reveal his obsession with secrecy. Because of his position, ''he did not want at any stage for there to be a connection between himself and the trust,'' a Portcullis TrustNet file note reveals. ''We can assure him that his records or his confidentiality would never leave these offices.'' Mr Williams blamed accountants and lawyers for making such arrangements possible to begin with. '''I am going to focus in on those people who have got them into it in the first place and enabled this. ''I am going to target the facilitators.'' Leaks help untangle web of offshore havens and those using them Richard Dukes, a tax specialist...
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...Journal of International Business Studies (2009) 40, 901–925 & 2009 Academy of International Business All rights reserved 0047-2506 www.jibs.net Why are companies offshoring innovation? The emerging global race for talent Arie Y Lewin1, Silvia Massini2 and Carine Peeters3 The Fuqua School of Business, Duke University, Durham, USA; 2Manchester Business School, University of Manchester, Manchester, UK; 3 Solvay Brussels School of Economics and Management, Brussels, Belgium Correspondence: AY Lewin, The Fuqua School of Business, Duke University, 1 Towerview Drive, Box 90120, Durham, NC 27708, USA. Tel: þ 1 919 660 7654; Fax: þ 1 919 660 7769 1 Abstract This paper empirically studies determinants of decision by companies to offshore innovation activities. It uses survey data from the international Offshoring Research Network project to estimate the impact of managerial intentionality, past experience, and environmental factors on the probability of offshoring innovation projects. The results show that the emerging shortage of highly skilled science and engineering talent in the US and, more generally, the need to access qualified personnel are important explanatory factors for offshoring innovation decisions. Moreover, contrary to drivers of many other functions, labor arbitrage is less important than other forms of cost savings. The paper concludes with a discussion of the changing dynamics underlying offshoring of innovation activities, suggesting that companies are...
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...Indian Black Money Abroad In Secret Banks and Tax Havens Second Report Of The Task Force on the steps to be taken by India Members Shri Gurumurthy, Chartered Accountant, Chennai Shri Ajit Doval, former Director Intelligence Bureau, Delhi Prof R.Vaidyanathan, Professor of Finance Indian Institute of Management, Bangalore Shri Mahesh Jethmalani, Senior Advocate, Mumbai Submitted to BHARATIYA JANATA PARTY 1 I. The First Interim Report The first Interim Report of the Task Force appointed by the Bharatiya Janata Party was released to the public on 17-04-2009. Afterward different world governments, particularly those in the West, have increasingly begun targeting tax havens and intensely began pursuing black money. The US, and France particularly began a huge campaign against the evil of black money. The estimates black money lodged in tax havens by global financial institutions like the International Monetary Fund reached as high as $18 trillion. The instability in the global financial order itself was traced to the evil money. So the issue has now acquired a totally different dimension. In the first Interim Report, the Task Force had suggested broad national and global strategy for dealing with the menace of black money out of the country. The substance of the recommendations of the Task Force in the First Interim Report is summarized here: Global Strategy: • Creating a powerful public opinion and broad national consensus on the issue. Those who do not...
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...domestic and international trading transactions are conducted (Business Dictionary, n.d.). London, New York, and Tokyo are the world's premier financial centres. It may be distinguish two types of financial centres: those such as London or New York, which are ‘international financial centres’ and which are excluded from the definition of extraterritorial centres. These latest are called ‘Offshore financial centres’, where the activity takes place outside the residence of the natural person. Despite its name, the off-shore centres are not necessary islands, although several insular jurisdictions have been established as such. First of all, an off-shore centre is a small, law-taxes jurisdiction specializing in providing corporate and commercial services to non-resident offshore companies, by offering: i) Liberal legislation regarding financial transaction ii) Very low taxes rates Therefore, off shore companies are those legal entities incorporated and registered in an offshore financial centre. In addition, there are more traits that are decisive in order to distinguish an offshore financial centre (OFC from now). For instance, in these jurisdictions, the financial sector is such a relevant and disproportionate share of the internal economy. And, most of the transactions that take place in their institutions are realised by clients residing in different jurisdictions (as we...
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...transforming its strategy and significantly improving its capital strength. The Swiss bank UBS became embroiled in controversy starting in 2008 when the U.S. Federal Bureau of Investigation (FBI) made a formal request to travel to Switzerland to probe a multi-billion-dollar tax evasion case involving the bank. The investigation had, in part, been prompted by disclosures made by Bradley Birkenfeld, a former UBS banker in Switzerland, who testified to the U.S. Department of Justice (DOJ). The issue started by Birkenfeld's whistleblowing and resulting controversy created unprecedented pressure on UBS, the Swiss banking industry and the Swiss government from the U.S eager to claw back delinquent taxes from assets their taxpayers had stashed in offshore accounts maintained by UBS and other Swiss banks. On February 2008 the US department of justice DOJ announced a deferred prosecution agreement with UBS. Whose term allowed UBS to avoid criminal indictment in return of payment of $780 million which comprises interest, penalties, and restitution for unpaid taxes, as well as the 250 names of the US Client who invaded TAXES by hiding assets in Switzerland. Other countries followed the US lead, relying on data that was stolen from Swiss banks. A computer technician who was working at Liechtenstein bank linked a secret to a German intelligence service data showing that hundreds of wealthy Germans had hidden their billions in secret account, these lead to the German government official seeking...
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...Offshoring Impact on U.S. Software Engineers for Leadership and Organizational Behavior Thesis: In my workplace, we have been outsourcing some technical work to Mexico. It has been interesting the feedback we are getting from our programmers. Although we’re outsourcing only when the work exceeds our capacity, they’re rightly concern about their jobs; they are concern about offshoring. I would like to write a feasibility analysis of offshoring work for my class project. I would like to be specific to “offshoring impact to software engineers”. April 17, 2011 Contents Offshoring Impact on U.S. Software Engineers 1 Contents 2 1 Introduction 3 1.1 Definitions 3 1.2 Summary 3 2 Data Section 4 2.1 Offshoring from a political perspective 4 2.2 Offshoring from a business perspective 7 2.3 Offshoring from software engineers perspective 9 3 Conclusion 11 3.1 Summary of Findings 11 3.2 Recommendations 11 4 Appendices 13 4.1 2008 Projected Base Salary Increases 13 5 Bibliography 14 1 Introduction 1.1 Definitions According to United States Department of Labor, software engineers (job 15-1031) develop, create, and modify general computer applications software or specialized utility programs. Analyze user needs and develop software solutions. Design software or customize software for client use with the aim of optimizing operational efficiency. May analyze and design databases within an application area, working individually or coordinating database...
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...CHAPTER 1 INTRODUCTION 1.0 Overview In recent years, researchers have identified that the offshore outsourcing of services is starting to become a thriving business area, serves as a tool for maintaining and increasing the competitiveness and also an important asset of international growth strategies of many service firms. Bryborn & Jantell (2005) states that every now and then there is a boom of interest in cutting operating costs and every time there is a different ways of how it is done. In the 1990’s, the trends used to cut costs were re-engineering of business processes. However, in the early 2000’s, after the economical downturn, there was a similar trend to reorganize business processes and the trend was called offshore outsourcing. The major driving force for offshore outsourcing are customers who wants more of everything for less money. In MIDAS Bulletin Oct-Dec 2004 publication mentioned that, “ Malaysia is among the top three contenders for offshoring business in the world according to the 2004 Offshore Location Attractiveness Index compiled by the global management consulting firm A.T. Kearney, sources were quoted. Malaysia is ranked 3rd behind India (1st) and China (2nd) but ahead of Singapore (5th), Philippines (6th) and Thailand (13th). In its report, A.T. Kearney considers Malaysia a “ natural choice” for offshore services in view of its low costs, particularly for infrastructure, the most attractive business environment among emerging...
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...NASSCOM-McKinsey Report 2006 yet again reaffirmed views of the global gurus that Remote Infrastructure Management (RIM) Services are all set to become the next star of the Indian IT Industry. It clearly states that “going forward, the more traditional IT outsourcing service lines such as hardware and software maintenance, network administration and help desk services will account for 45 per cent of the total addressable market for offshoring and are likely to drive the next wave of growth. . Service lines that have driven recent growth, i.e., application development and maintenance (ADM) and R&D services are already 30-35 % penetrated and are not as likely to grow dramatically”. The Remote/offshore part was easy with BPO having already paved the way for proving service delivery effectiveness from an offshore location and with the advent of sophisticated tools and technologies that enabled remote IT management the proposition was further solidified. International research firm IDC also declared that “more than 85% of infrastructure components can be managed from a central remote location. These components encompass servers/systems, databases, networks, storage, security, applications and e-business infrastructure. Through managing these components from a remote location, companies can cut down their cost of infrastructure operations and management by 40-60 %, also gaining access to expert ‘skill-on-tap’ on a 24x7 basis” For decades the global giants who had been ruling the Infrastructure...
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... Strong growth opportunities • The IT-BPM sector in India is estimated to expand at a CAGR of 9.5 per cent to USD300 billion by 2020. The sector increased at a CAGR of 25 per cent over 2000–13, 3-4 times higher than global IT-BPM spend • Leading sourcing destination India is the world’s largest sourcing destination, accounting for approximately 52 per cent of the USD124–130 billion market. The country’s cost competitiveness in providing IT services, which is approximately 3-4 times cheaper than the US continues to be its USP in the global sourcing market Largest pool of ready to hire talent • India’s highly qualified talent pool of technical graduates is one of the largest in the world, facilitating its emergence as a preferred destination for outsourcing Most lucrative sector for investments • The sector ranks fourth in India’s total FDI share and accounts for approximately 37 per cent of total Private Equity and Venture investments in the country Source: NASSCOM; Aranca Research Note: BPM - Business Process Management, USP - Unique Selling Proposition 2013E • Growing demand Growing demand Strong growth in demand for exports from new verticals Expanding economy to propel growth in local demand • • Global footprints IT firms in India have delivery centres across the world; as of 2012, IT firms had a total of 580 centres in 75 countries India’s IT & ITes industry is well diversified across verticals such as...
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...with revenues of over US$ 4 billion. Infosys defines, designs and delivers technology-enabled business solutions thathelp Global 2000 companies win in a Flat World. Infosys also provides a completerange of services by leveraging our domain and business expertise and strategicalliances with leading technology providers. Infosys' service offerings span business and technology consulting, application services, systems integration, product engineering, custom software development, maintenance, re-engineering, independent testing and validation services, IT infrastructure services and business process outsourcing .Infosys pioneered the Global Delivery Model (GDM), which emerged as a disruptive force in the industry leading to the rise of offshore outsourcing. The GDM isbased on the principle of taking work to the location where the best talent isavailable, where it makes the best economic sense, with the least amount ofacceptable risk. Infosys has a global footprint with over 40 offices and development centers inIndia, China, Australia, the Czech Republic, Poland, the UK, Canada and Japan.Infosys has over 91,000 employees. Infosys takes pride in building strategic long-term client relationships. Over 97% of our revenues come from existing customers. alliance-------------- AlliancesInfosys' services and business solutions are strengthened by alliances with leading technology partners. We recommend technologies to the client based on what is best for the client. Wedo not solicit...
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...International Bus Mgmt Victor Ebong Turn-in September 13, 2011 Offshoring & Outsourcing 1. Explain outsourcing, offshoring, and nearshoring and give the benefits/costs of each. Why are the benefits of offshoring being questioned more recently? (Reading 1) * Outsourcing- The farming out of work or certain duties to an outside organization. It can be to a company outside the country but in most cases when termed “outsourcing” it is being done within the country. The benefits of this are that jobs are not being lost in a particular territory or country and the work is being done at a more cost effective and efficient rate * Offshoring- Is the wholesale shifting of corporate functions and jobs to overseas territories. This may not necessarily mean shifting of the work to a different organization but rather shifting work to organization’s subsidiaries abroad. * Nearshoring- Is a concept similar to offshoring whereby companies shift operations, often IT related to foreign countries that are close to their own. The major reason behind this is that while gaining the labor cost advantage, many of the same languages are being spoken of the parent corporation. Additionally, these operations allow for travel on short notice without jet-lag. * The benefits of offshoring are being questioned now more than ever because of the extremely high unemployment rates here in the US. Many critics believe that those Americans out...
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