...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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...Riordan Manufacturing Outsourcing Plan Introduction Riordan Manufacturing (RM) is an established global plastics producer, which employees 550 individuals and their projected annual earnings are $46 million. RM has production divided among three plants. RM’s mission is to focus on achieving and maintaining profit that ensures that the financial and human capital is available to sustain growth. In week three, team C established four potential outsourcing options. Of those four potentials, RM stands to gain the most potential from outsourcing customer relationship management (CRM). This could cover service, sales, and marketing. Services that will be provided include the call center support, field support management, e-Service, campaign management, sales forecasting, account management, and pipeline management. Outsourcing will assist with new government required reporting requirements. CRM will assist RM for future outsourcing projects such as switching over to compatible systems for finance and accounting. Situation Analysis RM is recognized for their innovation and providing customers with new products. An outsourcing plan pertaining to CRM has been established below. The success of the project will be measured by the performance measures; customer satisfaction, marketing, and employee retention. Outsourcing Plan Based on research by RM they have created a cost-effective recognition program that is aimed at motivating employees, increasing retention, and increase...
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...Outsourcing in Healthcare Outsourcing in the health care industry continues to grow in an effort to cut the raising cost, to increase efficiency and quality of care by hospitals nationwide. As annual healthcare spending in United States hit $3.8 trillion (Munro, 2014), and aging population in America is increasing with the retirement of baby boomers and higher demands for patient care, the cost of healthcare will continue to grow. In response to increasing cost, many hospitals will employ outsourcing to save money and combat rising costs. This paper will examine outsourcing trends in healthcare. Prevalence and Trends Outsourcing is not a new trend in healthcare. In the past, medical centers successfully outsourced support services, such as construction, IT, translation, laundry services, housekeeping and food services. Today, in an attempt to reduce rising cost of healthcare services, hospitals increasingly turning to outside contractors for patient care and clinical services, such as medical staffing, radiology services, laboratory services and clinical specialties. The clinical specialties most frequently outsourced are anesthesia, emergency department, dialysis services, diagnostic imaging and hospitalist services (Waller, 2012). For information technology, 97% of respondents report outsourcing one or more of these services, such as EMRs, patient satisfaction surveys, help desk, CPU and peripheral maintenance and local IT support (Waller, 2012). According to Modern Healthcare...
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...This paper describes the situation at the United States (US) based company, Global Communications (GC) in the telecommunication industry. Different challenges and opportunities at GC are discussed. The paper continues by discussing the different stakeholders' perspective/ethical dilemmas and continues by framing a problem statement for the Global Communications situation. An expected end state situation is then described for GC scenario. The paper continues by analyzing different alternative solutions to the Global Communications situation , the risk for each solution is described and an optimal solution from a numbers of alternative solutions is selected. An implementation plan for the selection solution for the Global Communications situation is described and a metrics to monitor the plan is presented. This paper concludes by reviewing the selected solution to the situation and discussing the expected result. Issue and Opportunity Identification As a result of competition from cable companies, the United States based company, Global Communication (GC) is losing market share and profitability in the telecommunications market. The traded stock value has dropped from $28 to $11 in a two year period and stockholders are receiving diminishing returns (University of Phoenix, 2006). The stockholders have lost confidence in the management. Management is under pressure to renew stockholders confidence by increasing returns on the stock and the traded stock value. Senior management...
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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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...Adversity of Outsourcing: Outsourcing from the Employee’s Perspective Schillen & Steinke Mitigating the Adversity of Outsourcing: Outsourcing from the Employee’s Perspective Sarah J. Schillen Seattle Pacific University USA sschillen@gmail.com Gerhard Steinke Seattle Pacific University USA gsteinke@spu.edu ABSTRACT This paper explores how outsourcing activities and decisions put the well-being of the remaining employees at risk, ultimately affecting productivity and creating further costs to the employer. It highlights four potential threats to remaining employees: trust, job satisfaction, motivation, and stress. The paper provides several suggestions for mitigating these impacts, including communication to retain trust, acting ethically to ensure satisfied employees, seeking an understanding of employee perspectives to build employee motivation, and providing good planning along with training and development to reduce employee stress. INTRODUCTION Globalization provides organizations with more options than ever before. Business leaders are continuously encouraged to adapt, reevaluate, and strategically improve processes and approaches. Best practices are reinvented rapidly in attempt to keep up with market trends. The quest to recognize new methods for increasing revenue has become the inspiration for exploring new management techniques and strategies. One such rising trend in the advent of global markets is that of outsourcing. Common purposes for outsourcing include improvements...
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...Why did Bharti outsource its network operations? Bharti was facing a challenge – the customer base was growing explosively (100% per year) but it was not able to keep up with the pace of the market growth. Bharti had challenges with management time, capital costs, and human resources. 1. Faster time to market: There was huge delay between the time when Bharti needed additional capacity and when that additional capacity could be up/running. Bharti was spending from six months to a year in the process of planning, tendering, purchasing, and installing. This took a lot of time from Bharti’s management team too and did not allow them to focus other important priorities in the company. 2. Scalability: Bharti was facing scalability issues both in its IT function and network function. 3. Human resources scarcity: Given the rapid growth in the industry, Bharti was finding it more and more difficult to hire and retain people. It was facing intense competition from other telecom providers as well are other multi-national companies to hire engineers. 4. Lean and predictable cost model: With the rapid changes in technology and also in the requirements for network capacity, Bharti was having a very unpredictable cost model. Instead of huge capital assets on the balance sheet and capital expenditures, Bharti wanted operating expenses which went hand-in-hand with the pace of its growth. 5. Capital Expenditures: With industry consolidation, the focus was switching from having...
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...Demographic Complementarities and Outsourcing: Implications for India By: Mukul G. Asher Professor, LKY School of Public Policy National University of Singapore e-mail: sppasher@nus.edu.sg and Research Scholar Department of Economics National University of Singapore e-mail: amarendu@nus.edu.sg Amarendu Nandy May 2006 Draft – Not to be cited without permission The authors would like to thank anonymous referees, Sanjeev Sanyal, Amlan Roy, Anantha Nageswaran and R. Swaminathan for their useful comments. The usual caveat applies. _______________ This is a longer version of the paper prepared for IMRC 2006 conference on Global Competitiveness through Outsourcing: Implications for Services & Manufacturing, Indian Institute of Management (IIM), Bangalore, July 13-15, 2006. Abstract This paper analyses the implications of differing global demographic trends for India’s competitiveness in outsourcing and offshoring. It also briefly notes the implications of differing demographic trends among the Indian states. The paper argues that demographic complementarities with high-income countries provide India with one-time opportunity to sustain its growth rate and occupy all segments of global outsourcing and offshoring activities. India has used the labor cost advantage to gain reasonable market share in these activities. It however faces serious internal and external challenges in sustaining its international competitiveness, particularly with respect to labor cost....
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...Perceived Impact of Outsourcing on Organizational Performance Dean Elmuti, Eastern Illinois University Introduction In todays world of ever increasing competition, organizations are forced to look for new ways to generate value. The world has embraced the phenomenon of outsourcing and companies have adopted its principles to help them expand into other markets (Bender 1999). Strategic management of outsourcing is perhaps the most powerful tool in management, and outsourcing of innovation is its frontier (Quinn 2000). Outsourcing is a management strategy by which an organization delegates major, non-core functions to specialized and efficient service providers, or as Corbett (1999). President of Michael F. Corbett and Associates asserts, Outsourcing is nothing less than the wholesale restructuring the corporation around our core competencies and outside relationships. The traditional outsourcing emphasis on tactical benefits like cost reduction (for example, cheaper labor cost in low-cost countries), have more recently been replaced by productivity, flexibility, speed and innovation in developing business applications, and access to new technologies and skills (Greer, Youngblood, and Gary 1999; Bacon 1999). The market for providers of outsourced services of all types is growing rapidly. In 1996, American firms spent over $100 billion in outsourced business activities (Casale and Overton 1997). Other estimates place the total U.S. market for outsourcing at more than $300...
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...Impact of Outsourcing in improving productivity in modern Organizational Introduction In today’s world of ever increasing competition, organizations are forced to look for new ways to generate value. The world has embraced the phenomenon of outsourcing and companies have adopted its principles to help them expand into other markets (Bender 1999). Strategic management of outsourcing is perhaps the most powerful tool in management, and outsourcing of innovation is its frontier (Quinn 2000). Outsourcing is a management strategy by which an organization delegates major, non-core functions to specialized and efficient service providers, or as Corbett (1999). President of Michael F. Corbett and Associates asserts, Outsourcing is nothing less than the wholesale restructuring the corporation around our core competencies and outside relationships. The traditional outsourcing emphasis on tactical benefits like cost reduction (for example, cheaper labor cost in low-cost countries), have more recently been replaced by productivity, flexibility, speed and innovation in developing business applications, and access to new technologies and skills (Greer, Youngblood, and Gary 1999; Bacon 1999). The market for providers of outsourced services of all types is growing rapidly. In 1996, American firms spent over $100 billion in outsourced business activities (Casale and Overton 1997). Other estimates place the total U.S. market for outsourcing at more than $300 billion by the year 2001 (Dun and...
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...2 ICTs AND GLOBAL WORKING IN A NON-FLAT WORLD Geoff Walsham Judge Business School University of Cambridge Cambridge, U.K. Abstract This paper rejects the hypothesis of Thomas Friedman that ICT-enabled globalization is driving us toward a flat world. Instead, it is argued that the world remains uneven, full of seams, culturally heterogeneous, locally specific, inequitable, not well-integrated and constantly changing. This argument is supported by an analysis of three areas of ICT-enabled global working, namely global software outsourcing, global IS roll-out, and global virtual teams. The paper then builds on these analyses to put forward an agenda for future IS research on ICTs and global working based on three research themes: identity and cross-cultural working; globalization, localization and standardization; and power, knowledge, and control. The paper concludes that the area of ICTs and global working offers the IS field a major research opportunity to make a significant contribution to our understanding of a set of crucial issues in our more globalized world. Flat world, globalization, global software outsourcing, global IS roll-out, global virtual teams, IS research agenda, identity, cross-cultural working, standardization, power, knowledge, control Keywords 1 INTRODUCTION The changes taking place in the global economy, including those in the burgeoning services component, are the subject of much debate by a wide range of commentators including journalists, practitioners...
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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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...increasingly widespread practice among organizations and is today of strategic importance that attract great interest from scholars in the literature. The primary purpose of the paper is to contribute with a review of leading studies that analyze procurement from the resource-‐based view of the organization. The paper begins by setting out the business environment of procurement and then presents the development and propensity of procurement. This is followed by a review of principal works and differences of perspectives of resource-‐based view. The next section contains an analysis of the relationship between procurement and resource-‐based theory and discusses empirical works on outsourcing that address outsourcing from the resource-‐based view. The studies are classified into two categories: those studying the propensity to procure and those studying the relationship between procurement decision...
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...What Went Wrong At Boeing? My article, The Boeing Debacle: Seven Lessons That Every CEO Must Learn, elicited spirited conversation. Several commentators noted that, in addition to the general lessons, Boeing made specific errors in the way it handled outsourcing and offshoring. Let’s take a closer look at those specifics. Boeing enthusiastically embraced outsourcing, both locally and internationally, as a way of lowering costs and accelerating development. The approach was intended to“reduce the 787′s development time from six to four years and development cost from $10 to $6 billion.” The end result was the opposite. The project is billions of dollars over budget and three years behind schedule. “We spent a lot more money,” Jim Albaugh, Chief of Commercial Airplanes at Boeing, explained in January 2011, “in trying to recover than we ever would have spent if we’d tried to keep the key technologies closer to home.” The right goal: add value for customers Let’s start with what Boeing did right. After losing market share to Airbus (owned by EADS) in the late 1990s, Boeing could have decided to focus on reducing the costs (and the selling prices) of its existing aircraft. That would have led inexorably to corporate death. Instead Boeing decided— commendably—to innovate with a new aircraft that would generate revenues by creating value for customers. First, Boeing aimed to improve their travel experience for the ultimate customers, the passengers. As compared...
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...Italian Quality: Campagnolo Bicycle Components Introduction Campagnolo is renowned for producing some of the most innovative, highest quality, and best performing bicycle components available today. They also provide a benchmark for original design as evidenced by winning the prestigious Compasso d’Oro award from the Associazone Design Italiano and has been recognized by the Wall Street Journal as one of the most prominent sports brands in the world. ‘This reputation has been earned not only through its countless racing successes, but also by virtue of the attention given to quality and to service that sets this company apart from all others.’ ("Focus," 2011, para. 6) Tullio Campagnolo, an amateur bicycle racer who was frustrated with current technology to change gearing on his bicycle, founded Campagnolo S.r.l in Vicenza, Italy in 1933. At the time, changing gears required the rider to dismount, remove the rear wheel and then flipping the rear wheel around so a different sized cog on the opposite side of rear wheel could be used, then reattach the wheel to the bicycle frame, and finally remount the bicycle and resume the race. This required tools and a bit of time off the bicycle to complete as derailleurs and quick releases had not yet been invented. Tullio Campagnolo spent three years designing, perfecting, and producing what has become one of the ubiquitous components on a modern bicycle – the quick release skewer. ‘The company soon expanded, focusing on the three...
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