...The Long Term Effects of Outsourcing on the US Economy The impact of outsourcing in the US economy has evoked extensive emotions to many, especially from presidential candidates and labor groups who criticized its practice. But economists and chief executives defend it as a natural succession of the economy. In today’s fast paced economy, it’s not new that outsourcing chased cheap labor costs around the globe for decade. But in recent years, the effort has move stealthily into higher mechanism and income brackets, and it shows no signs of slowing down. As a concept it is not new. Companies have chased cheap labor around the globe for decades, making cars in Mexico, plastic toys in Taiwan and shirts in Malaysia. The latest outcry is fueled by the fact that some service professionals, once insulated from outsourcing, are watching their jobs head overseas during a largely jobless recovery. It is unclear how many accounting, engineering, technical support and other professional jobs have moved offshore in recent years According to research data, more than 400,000 U.S. jobs had moved abroad and the total is estimated to hit 3.3 million by 2015. That’s just above 200,000 jobs lost every year to global outsourcing. Many government agencies outsource as part of their work in order to save millions of dollars, which helps US economy and helps federal spending. The theory here is that paying people less for work means that these companies have the ability to produce things cheaper...
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...The global sourcing challenges of IKEA Who does not know IKEA? Famous for its design and very affordable house furniture, IKEA is the leader on its market. Founded in 1943 by Ingvar Kamprad this business grew tremendous fast that it has become the reference in term of low-cost self assemble furniture in the world. The sourcing strategy of IKEA follows a manufacturing Code of Conduct towards its suppliers named “The IKEA Way in Purchasing Home Furnishing Products” (IWAY) . Besides this code, the strategy is rather well established especially regarding the relationships between the company and its suppliers from the economically developing countries. But the question is; are Ikea’s international procurements processes efficient? Can they be improved? This essay will focus on Ikea’s global sourcing’s tradeoffs and will highlight the way they can be enhanced. The first part of this essay will describe the regular sourcing process of IKEA including the strategy, the second part will emphasize how the sourcing should be done to be successful and the last part will provide recommendations about the processes according to the analysis. For a company, global sourcing is basically choosing different suppliers all around the world in order to use worldwide efficiencies and reduce costs. Global sourcing offers various advantages such as low cost materials and skilled labour, diminution of lead times, and also economical advantages like low taxes or low trade tariffs. These benefits...
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...over the years have allowed virtual paralegals to work from home or anywhere and provide the smaller law firms or solo attorneys the professional work ethics and helping to reduce the cost of the attorney’s overhead. With the vast improvements in technology over the years, it has allowed more out of the office work to be done. Having a laptop gives you more flexibility with travel and still be productive. Wi-Fi hotspots are readily available in many locations when traveling. What makes this excellent for small law firms and solo attorneys is that they can reduce the cost of their overhead. The small law firms and solo attorneys need the assistance of paralegals. Utilizing a paralegal outside of the office can still provide a professional level at a cost that is more cost efficient. There would be no salary to pay out, but rather an hourly rate. They would not necessarily need the extra office space expenses for a paralegal by resourcing out. Using virtual paralegals also allows the attorneys to do what they went to law school for, and that was to practice law. The average of a full-time employee hired by an office averages around $62,000 annually (Starr, 2013) which comes out to about $30 an hour. Attorney offices also have the expenses of 35 percent of taxes and benefits. Attorney's overhead costs come to around $84,000 each year. The smaller law firms or solo attorney can cut expenses down considerably by using a virtual paralegal. Smaller law firms and solo...
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...by the society and its moral norms. Reasonable expectations of privacy in public places must change as our social environment changes. As moral and social norms change in a society the expectation from an individual towards society changes and thereby the individual’s privacy values. For example, slavery was an accepted practice in the late 19th century; today it’s not in practice. In the current information technology age, when an individual submits his personal information for purchasing merchandise online, it is within his expectation that his personal information be protected by the website. In future with the increasing use of technology in the day to day activities, new issues of privacy will arise making today’s notions of privacy out of date. One such issue is the privacy of personal information in business process outsourcing. Business process outsourcing (BPO) is the process of contracting a specific business task to a third-party service provider. There are two categories of BPO. Back office outsourcing constitutes the outsourcing of internal business functions such as purchasing or billing. Front office outsourcing constitutes the outsourcing of customer-related services such as second-level customer support and marketing. BPO contracted outside the company’s country to a third party company is called offshore outsourcing. Companies market their products globally instead of one region. Competition in these global marketplaces leads the company to optimize their...
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...– Apr 2015 IMS People is an Offshore Recruitment Services firm whose customized services help companies and staffing firms source talent for opportunities at home and abroad. We tailor our services to each client’s needs by providing traditional recruitment services and creative, one-time solutions that help companies gain advantage in their market and drive their recruitment value chain. Achievement: Awarded Performer of the month for May-2014, Sep-2014. Awarded New Comer of the Year 2014. Duties: As a Recruitment consultant I am responsible for building and maintaining relationships with clients, colleagues and candidates. This enables me to research and generate new business opportunities. Duties Included; * Headhunting and sourcing candidates dependant on employer requirements * Regular business development calls with new and existing clients * Interviewing and screening candidates to create a strong pipeline * Marketing...
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...Purchasing The Low-cost Learning curve t might not be the best habit, but people have a tendency to categorize everything. The same often happens with low-cost country sourcing, which lumps totally diverse countries scattered all over the world into the same category of inexpensive procurement opportunities. Many still debate whether the process itself actually varies that much from country to country. Is the strategy for sourcing from China really any different than it is from India, Turkey or Brazil? For David Hoover, vice president of strategic procurement for HNI Corp., the answer is, “No, it’s not.” Of course, there’s a little more to it than that. “In the end, human beings are always the ones doing the business. And everyone has an interest,” notes Hoover. “The challenge, in any supplier relationship, is to understand what the other party’s interests are, so that you can help satisfy them. When you do that, they will be compelled to help satisfy yours.” A few years ago when HNI, a global office furniture manufacturer, started evaluating the potential cost benefits of sourcing in China, the company took an approach that utilized its decentralized business model called “split and focus.” However, while the model proved very effective on the customer side of the business to accommodate different product markets and consumer bases, the company quickly learned that the approach needed a few minor adjustments to be as successful on the supply side. “[Initially] we were sending...
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...reverse auction is similar to a unique bid auction as the basic principle remains the same, however a unique bid auction follows the traditional auction format more closely as each bid is kept confidential and one clear winner will emerge at the completion of the auction. . The reverse auction has been widely used by many organizations and is aimed at reducing costs and sourcing services or products at the lowest possible price from the participating suppliers. Some of the benefits are: A reverse auction provides buyers with the most competitively priced solution to their needs by pitching suppliers against each other to be the one offering the lowest-priced bid. It saves time in the procurement process and also streamlines the procurement process as well as reduces the need to send a different request for proposal to each potential supplier. It equally has some disadvantages that makes it a bad method like creating problems when proper controls are not put in place. Competition for the lowest price can make some suppliers to cut corners to maximize benefit or even send them out of business when the project turns out to be a loss. Since this is based solely on price, quality and standard may be compromised and aggressive under-bidding practices can result in supplier winning a contract that cannot be completely executed at the agreed price....
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...GLOBAL SOURCING Strategic Soucing at Whirpool China Finding the ideal supplier CASE ANALYSIS Assignment 1 STRATEGIC SOURCING AT WHIRLPOOL CHINA FINDING THE IDEAL SUPPLIER CASE ANALYSIS 1. What are the key problem areas for Whirlpool? Finding the right supplier. 2. What is the importance of strategic sourcing? Sourcing the right components is the first step in launching the new product. 3. What are the pros and cons of Whirlpool’s global sourcing strategies? Cons: Payment terms. Pros: To avoid delays in launching the new product. 4. How are suppliers identified, evaluated and selected? It was necessary to define the commodity and allocate responsibilities and resources through co-ordination of global and regional activities. Using the Sourcing Strategy Development (SSD) process in 4 steps: Step 1: internal analysis, identified and prioritized the process –partner requirements, then evaluated the performance of the existing supply base and reviewed the existing supply base, it also identify the switching costs. Step 2: external analysis, which includes analysing the supplier industry and competitors and evaluating competitor performance and strategies. The evaluation process makes use of SWOT (Strength, Weakness, Opportunities, Threat). Step 3: strategy development, is to analyse the competitiveness and their financial impact. Preliminary negotiations could be carried out, a suitable strategy and suppliers should be selected and...
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...rP os t Sw W12079 STRATEGIC SOURCING AT WHIRLPOOL CHINA: FINDING THE IDEAL SUPPLIER op yo Dr. Martin Lockstrom, Thomas E. Callarman and Shengrong Zhang wrote this case solely to provide material for class discussion. The authors do not intend to illustrate either effective or ineffective handling of a managerial situation. The authors may have disguised certain names and other identifying information to protect confidentiality. Richard Ivey School of Business Foundation prohibits any form of reproduction, storage or transmission without its written permission. Reproduction of this material is not covered under authorization by any reproduction rights organization. To order copies or request permission to reproduce materials, contact Ivey Publishing, Richard Ivey School of Business Foundation, The University of Western Ontario, London, Ontario, Canada, N6A 3K7; phone (519) 661-3208; fax (519) 661-3882; e-mail cases@ivey.uwo.ca. Copyright © 2012, CEIBS Version: 2012-06-19 tC It was April 10, 2011, when Gianluca Castelletti, head of Whirlpool’s Asia International Procurement Office in Shanghai, was informed by his colleagues that the company was about to launch a new refrigerator model in just six months. With the current worldwide focus on energy saving, and as one of the biggest home appliances producers, Whirlpool China planned to introduce a new energy-efficient refrigerator. No Castelletti immediately spotted a challenge in Whirlpool...
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...Practicum Strategic Sourcing at Whirlpool China Q1. Whirlpool’s Global Sourcing Strategy (GSS) in China had many advantages as well as disadvantages. As the case explains, China had become one of the world’s largest household appliance makers, and relocation of Whirlpool’s Asian HQ to Shanghai helped the company’s products gain acceptance within the market. Furthermore, setting up an international procurement office in Shanghai helped to eliminate various factors that could make global sourcing a difficult process. Whirlpools Shanghai HQ decreased transportation delays and cultural and language differences and supported the company’s own manufacturing operations in Asia. Other advantages to global sourcing in China include: reducing capital investments, gaining market share, focusing on core competencies, and increasing flexibility in production. Although China may provide a cost advantage in regards to raw materials, disadvantages occurred in areas such as quality, reliability, a lack of capable service providers, and inadequacies in transportation and IT infrastructures. Q2. When it came to potential suppliers, Whirlpool set their standards high. In order to be considered a supplier of Whirlpool, quality requirements set forth by the Whirlpool Supplier Quality System had to be met. Most suppliers in China, however, found difficulty in reaching the minimum required score of 60/100 during the first round of audits. Whirlpool used the Sourcing Strategy Development (SSD)...
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...classifying and analyzing expenditure data with the purpose of reducing procurement costs, improving efficiency and monitoring compliance. It can also be leveraged in other areas of business such as inventory management, budgeting and planning, and product development. There are three core areas of spend analysis - visibility, analysis and process. By leveraging all three, companies can generate answers to the crucial questions affecting their spending, including: ▪ What am I really spending? ▪ With whom am I spending it? ▪ Am I getting what’s been promised for that spend? Spend analysis is often viewed as part of a larger domain known as spend management which incorporates spend analysis, commodity management and strategic sourcing. Companies perform spend analysis for several reasons. The core business driver for most organizations is profitability. In addition to improving compliance and reducing cycle times, performing detailed spend analysis helps companies find new areas of savings that previously went untapped, and hold onto past areas of savings that they have already negotiated. Benefits of Spend Data Management: [pic] 2. Goods Spend Analysis: How is it conducted? 3 major components of a spend analysis: |Component |Activity |Typical deliverable | |(a)Opportunity assessment |Collect and validate category spend data/diagnose...
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...Case Analyses- Request for Proposal The Request for proposals (RFPs) is used in negotiated acquisitions for the procurement of supplies and services (research and development (R&D), construction and commercial items), by the contracting officer issuing a solicitation to communicate the government needs to prospective contractors. The policies and procedures that govern RFPs vary between the procurement of commercial items and construction. The purpose of this paper is to compare the two RFPs and identify the differences. The Federal Acquisition Regulation (FAR) requires commercial items acquisitions exceeding $5.5 million to be solicited using the RFPs contract method and solicitations is prepared using the standard form (SF) 1449. The commercial items RFP used in this comparison was issued by the Department of Veteran Affairs (DVA). The requirement is to provide inscription for blank marble niche covers for Arlington National Cemetery. The acquisition is being set-aside for service-disabled veteran-owned small business (SDVOSB). The period of performance is for a base period and four option years. The option clause to extend the term of the contract is included. The option clause does not obligate the government to exercise the option years. The government may exercise an option by providing the contractor with a written notice within the time specified in the contract. The solicitation states that prospective contractors must provide an all-inclusive unit price. The...
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...BBCM Silver Oaks Industrial Sites Block 2, 32 Oak Avenue, Ferndale, 2194 REQUEST FOR PROPOSAL 01/13 INTRODUCTION Branelli Beads and Clothing Manufacturers (BBCM) is seeking proposals from interested contractors and/or firms to provide procurement and installation of commercial sewing machines, design tables and storage cabinets together with training staff on these machines. BACKGROUND BBCM is a jewellery a/accessories and clothing manufacturers supplying their products to YDE chain stores in South Africa. BBCM is located at Silver Oaks Industrial Sites Block 2, 32 Oak Avenue, Ferndale, 2194. The chain stores managed clothing and jewellery stock stability mainly through BBCM’s products for the past five years. It is well known for their trendy, fashionable throughout all seasons through low cost – high quality products. BBCM is one of the recognised brand labels, especially with young generation throughout South Africa and has won two top awards in the clothing industry. At this point, BBCM is facing a challenge in the production of its clothing as YDE has extended its chain stores to the SADC region with their stores specifically in the main cities of Botswana, Lesotho and Swaziland. BBCM has extended its office space by building a new office block to expand its Manufacturing and Design Departments. PROJECT REQUIREMENTS a) Project Description BBCM is seeking contractor and/or firm to design, procure, fit and train per specifications below: - 8 industrial...
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...1.What is the concept of procurement in the context of the public sector? Investopedia.com defines procurement as the act of purchasing. In the public sector, procurement is the acquisition of products and services on behalf of the government (2016). The Office of Federal Procurement Policy (OFFP), which was created by congress in 1974 to guide government-wide procurement policies to promote efficiency and effectiveness in the acquisition process. The OFFP states that it is very important for the government to ensure that it spends money wisely and eliminates waste and abuse of taxpayers’ dollars (OFFP, 2016). 2.What differentiates the concept of procurement in both the private and public sectors? Why is public sector procurement different from private sector procurement? Corporate procurement in the private sector can be a “complex and lengthy process”. Therefore, many major corporations hire a Chief Procurement Officer to deal with all major acquisitions for the company (Investopedia). The main difference between public and private procurement is that in the private sector they have a more flexible budget for the acquisition of products and services, whereas in the public sector the budget is limited due to the OFFP, which ensures that the government spend taxpayers’ dollars wisely. Rocheleau, states that if an organization agrees to purchase from outside vendors; they must request an RFP or related mechanisms to obtain detailed bids. Some of the approaches detailed...
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...Home Depot Service In 1978 Home Depot organization opens the first retail home improvement store in Atlanta Georgia. The organization developed strategic product analysis delivering a variety of assortments to customers. Innovative merchandise targets internal and external customers of the organization for do it yourself projects, professional contractors, free how to clinic and children workshops are available for customers to complete construction projects on different job sites. Home Depot evolved into internationally recognized specialty retailer that markets and delivers 40,000 different building materials, lawn and garden products, home improvement supplies, appliances, and more than 250,000 other products that can be especially ordered (The Home Depot U.S.A., Inc., 2003-2006). It has been noted that “The Home Depot has convenient locations throughout the United States. Stores average 105,000 square feet with approximately 23,000 additional square feet of outside garden area” (The Home Depot U.S.A., Inc., 2003-2006, Our Company, Stores and Product section). A possible solution for addressing and fulfilling the organization’s expectations is to examine policies and procedure requirements for an additional customer service. Home retail improvement products and services in the future will gain efficiencies from departments such as services that are policy written and business procedures through development of more new products demanding customizations from business...
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