...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on tactical benefits like cost reduction (for example, cheaper labor cost in low-cost countries), have more recently been replaced by productivity, flexibility, speed and innovation in developing business applications, and access to new technologies and skills (Greer, Youngblood, and Gary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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...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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...Management Outsourcing [pic] I. Introduction Outsourcing is used extensively by both the manufacturing and service industries, and there are plenty of reasons to utilize outsourcing. Organizations make use of outsourcing usually in the interest of lowering cost and to make better use of time and energy costs, hence redirecting their energy to something more important or just to conserve energy. Outsourcing is essentially a division of labour. One simple example involves companies outsourcing their financial statements to accountancy firms to consolidate their expenditures, hence eliminating the need to hire an accountant. Another relevant example would be to hire the services of another company to manage all or parts of the services that otherwise would be otherwise rendered by an IT unit of the organization. Some reasons for outsourcing include organizations being able to focus purely on their core business, for example an automobile factory. The raw materials required to manufacture an automobile are outsourced to other companies and hence the company itself can focus on just creating quality automobiles. By outsourcing the raw materials to companies who specialize in providing them, they can also ensure that the raw materials are of reasonably better quality and this can be done by contracting with a new service level agreement. Another reason being companies are able to access the wide pool of talent available through hiring agencies. In layman terms, outsourcing involves...
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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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...International Journal of Physical Distribution & Logistics Management Connecting strategy‐linked outsourcing approaches and expected performance Barry Brewer Bryan Ashenbaum Jeffrey A. Ogden Article information: To cite this document: Barry Brewer Bryan Ashenbaum Jeffrey A. Ogden, (2013),"Connecting strategy#linked outsourcing approaches and expected performance", International Journal of Physical Distribution & Logistics Management, Vol. 43 Iss 3 pp. 176 - 204 Permanent link to this document: http://dx.doi.org/10.1108/IJPDLM-10-2011-0175 Downloaded on: 22 November 2014, At: 23:44 (PT) References: this document contains references to 98 other documents. To copy this document: permissions@emeraldinsight.com The fulltext of this document has been downloaded 614 times since 2013* Downloaded by INDIAN INSTITUTE OF FOREIGN TRADE At 23:44 22 November 2014 (PT) Users who downloaded this article also downloaded: Pamela Kent, (2011),"The decision to outsource management advisory services", Managerial Auditing Journal, Vol. 26 Iss 8 pp. 672-696 Jane C. Linder, Martin I. Cole, Alvin L. Jacobson, (2002),"Business transformation through outsourcing", Strategy & Leadership, Vol. 30 Iss 4 pp. 23-28 Kate Vitasek, Karl Manrodt, (2012),"Vested outsourcing: a flexible framework for collaborative outsourcing", Strategic Outsourcing: An International Journal, Vol. 5 Iss 1 pp. 4-14 Access to this document was granted through an Emerald subscription provided by 446474 [] For Authors ...
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...Outsourcing – A Global Challenge MBA-700 International Economics Abstract The choice to outsource is a major strategic decision not made lightly by companies in today’s global marketplace. Though it brings probable results of cost reduction, loss of control in your product or the quality of service rendered makes this a decision that should not be taken lightly. Though a concept decades old, outsourcing is a topic that brings out fervor in individuals fighting for or against it. It’s a debate centered on moral, economical, and political aspects, with feelings that intensify during economic downturns because of the This paper will discuss theories of outsourcing, while comparing and contrasting the disadvantages and advantages (SWOT Analysis – see Appendix 1) of a concept that is growing in global business. The paper will conclude, most importantly, with discussions on three outsourcing alternatives and their potential to re-invent the status quo. Introduction The advent of globalization has proven that outsourcing is not a hypothetical situation; it is a major strategic business decision growing in popularity that our American workforce must now face in the decline of our U.S. economy. Some believe that outsourcing has become a serious issue not only for our workforce, but also in our major corporations, and the political arena. Issues such as the security of our nation have become debate topics, with critics arguing that outsourcing has weakened national security...
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... Michael Franklin MBA – 6241 16 September 2012 Abstract This organizational perspective paper provides an overview of outsourcing, how the relationship between development and performance management effects outsourcing services and the goals of HCL Technologies. An Organization Perspective on HCL Technologies Introduction In order for a company to effectively provide outsourcing services, it is important that some the internal aspects of the company, such as development and performance management, be established and operating proficiently. In doing so, it is also important that the Human Resource Management (HRM) team know what type of development is needed within an organization as well as establish a good performance management system in order to meet outsourcing organizational strategic goals. “For a company to have a good strategy foundation, certain tasks must be accomplished in pursuit of the company’s goals, individuals must possess certain skills to perform those tasks, and these individuals must be motivated perform their skills effectively.” (Noe, R., Hollenback, J., Gerhart, B., Wright, P. 2010, p. 9) This is where the importance of development and performance management becomes essential for a company. When providing outsourcing services for global clients, it is important that internal aspects such as development and performance management are operating at the highest level. HCL Technologies is a technology company based out of India that has a vision...
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...Based View of An Organization Phuong Duong University College Dublin (12251697) 4112 words ABSTRACT Procurement has become an 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...
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...Risk Analysis of IT Outsourcing Case Study on Public Companies risks can be described by using Agency theory and Transaction Cost theory [3], [4]. They identified various types of risks which are additional costs, service debasement, disputes and litigation. Without a thorough comprehension of how to manage these risks, any benefits achieved could be offset by significant losses. Therefore, risks must be measured, understood and then mitigated to ascertain that organizations will meet their IT outsourcing goals. Organizations that perform risk analysis and correctly manage risks associated with IT outsourcing will be able to anticipate and alleviate issues associated with IT outsourcing [3]. Established literatures in IT outsourcing provides strong evidence that IT-outsourcing risk management has a significant role in determining the success or failure of IT management. If risks including the relationship between undesirable outcomes and factors leading to outcomes can be understood, then they can be managed more effectively and efficiently. Consequently, organizations will be able to harvest as much benefit as it can out of IT outsourcing. Abstract—IT outsourcing is the subcontracting of previous in-house IT activities to external IT vendors who can do them better and more efficiently because they possess more resources and higher experatise. Firms are driven to acquire IT outsourcing services because they expect these specialized firms to provide...
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... Gulam Kirmani Instructor name- Patricia otiede Stevens Henager College The term organization has several meanings but the one meaning/definition which can be implemented here is an organized body of several people with a particular purpose or reason, especially a business, a society, association etc. There are various organizations which are working currently in various disciplines. Organizations always will have definite designations for people comprising an organization. For example organization will have designations like Managing Director, Manager, Human Resources Department, Banks, Outsourcing Companies, etc. Organizations which are comparable with healthcare organizations are Information Technology Companies, the companies which sell their products online etc. Information Technology organizations are the one who focus a lot on Continuous Quality Improvement very keenly and closely. They have numerous customers with whom they have to deal with daily. They have to reach to various new customers daily. These companies focus on quality improvement very frequently. There are some organizations which sell their products online and they also deals with the quality improvement. For selling the products online they have to be always ready with the new plans and offers which should attract their customers on very first...
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...REPORT ON OUTSOURCING Executive Summary Out sourcing can be defined as taking services of third party in order to get the solution or task done on time without hiring employees permanently in an organization. This paper is based on a case named “report on outsourcing”. In this case a manger wants to get an advice regarding the future of outsourcing in an organization. As per the current trend in the industry, outsourcing is the best way to get work professionally from experts all over the world. E-HRM is the term that defines “outsourcing HR” more technically. This paper includes academic journal articles and other literary sources; in addition company analysis examples are also included in this task. The issues discussed in particular are the evaluation of HRM factions in terms of outsourcing. Table of Contents Executive Summary 1 Introduction 3 Discussion 4 Concept of Our Sourcing 4 HR Fuctions Generally Outsourced 5 Recruitment 5 Training 5 Learning 6 Advantages and Disadvantages of HR Outsourcing 7 Advantages of Outsourcing HR 7 Disadvantages of Outsourcing HR 9 E-HRM 10 Role of E-HRM in Outsourcing HRM Function 11 Advice to the Client 13 Case Scenario Summary 13 Advice 13 Conclusion 16 References 18 Report on Outsourcing Introduction The Intelligent outsourcing is the use of contracted resources, assets and capabilities of a third party, guaranteed quality criteria, performance and value levels against the cost, as well...
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...Effects of Outsourcing Name Institution Effects of Outsourcing Abstract Outsourcing is the practice of assigning a firm's business progressions to an outside agency for the purpose of improving service quality, driving innovation, or developing benefits of lower labour costs (Burkholder. 2006). Intercontinental outsourcing occasionally known as offshoring is a significant facet of economic globalization. Since outsourcing hints to more specialization, it is anticipated to reduce production expenses and to raise productivity. This study uses micro data on American firms to investigate the effects of international and domestic outsourcing on the economy at large, jobs, the production quality and the its ethnic view in the United States. It is based on a unique survey on outsourcing covering the period 2001 to 2013 over a decade of study. The survey allows one to distinguish between domestic and international outsourcing and between outsourcing of core and support activities. This article will highlight the changes that have been observed since the initiation of the outsourcing practise to its impact on the areas of study in sub-topics. Introduction The conflict has been going on from at least the 1880s, when the first New England textile mills initiated moving its manufacturing process to the Carolinas. Whatever name it goes by be it runaway plants, outsourcing, global sourcing, offshoring workers and the public tends to have mixed fillings towards it, executives view it as...
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...made known to public only through the disclosures. This paper reviews the literature on CSR disclosures and the effect of these disclosures. There are various factors which determine the extent of disclosures like the size of the firm, industry, high visibility, etc. Introduction Corporate Social Responsibility (CSR) is now prominent and evident more than ever due to the emphasis laid on businesses regarding environmental, social and ethical issues. This is because over the recent years, there have been social, political and economic pressures on corporate management to pay attention on social and environmental consequences of corporate activities. These pressures motivated the corporate management to actively participate in a wide range of social welfare activities. CSR now-a-days covers almost all issues like the use of child labor; inequality of employment; environmental impact; involvement in local community; products’ safety; company cultures; brand image and reputation. Apart from this, companies are now disclosing these activities in their annual reports, and one of the parameters to judge the performance of a company is CSR reporting. Corporate Social Responsibility CSR is defined by Naylor (1999) and mentioned in the work of Douglas et al. (2004) as “the obligation of managers to choose and act in ways that benefit both the interests of the organization and those of society as a whole.” Commission of the European Communities defines CSR as a concept by which “companies...
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...September 2, 2012 Part One (Theoretical Framework) What are the effects of human resources outsourcing on leadership performance and employee commitment? This is a question facing every business. Although this is not a new topic of discussion there are still questions about its true effect on leadership performance and employee commitment. Outsourcing different jobs throughout a business’s many departments has been a common practice since the 1970’s. (Pence, 2010). At first the most common job/task that was outsourced was the company’s payroll but over the last decade more and more businesses are finding it more economical to outsource the majority of the jobs/tasks performed in a human resource department. (Nash, n.d.). In the following report we will discuss the variables and identify if they are dependent, independent, mediating, or moderating. The first variables needing to be discussed are the dependent or criterion variables. In this study they would be leadership performance and employee commitment. Leadership performance is always going to be present whether it is good or bad. The same can be said about employee commitment. These two variables may be influenced by other factors as to which end of the scale they will be located, but they will always be present. The second variable that needs to be discussed is the independent or predictor variable. (Bazerman, 2009). In this situation the outsourcing of human resources jobs/tasks would be considered this type...
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...Executive summary: Outsourcing allows company to reduce their cost and gain a competitive advantage and this idea is strongly adopted by companies all over the world. Outsourcing is an agreement in which one company contracts-out a part of their existing internal activity to another company. Outsourcing benefits company because it maximizing company’s resources, more efficient output and make legal agreement for performance guarantees. Telstra is Australia’s leading telecommunications and information service company (telco). Telstra has been using BPO (Business Process Outsourcing) which creates substantial business across Asia, North America and Europe. For home country, owners earn cost & saving efficiency and diversity of intellectual talent, hence, government face unemployed labor force and manager loss their ability to control as the disadvantages. For the host country, employees improve their life standart and there are economic growth. But, there’s higher social gap and inflation for the host country. Nike is a major publicly traded sportswear and equipment supplier based in the United States. They outsourced Customers services, manufacturing, advertising, promotion, charity, and society impact. For the home country, it cut their cost and expand international market, hence, it also bring negative social impact and mislead reputation. For the host country, it make lower unemployment rate and financial & risk reduction. Meanwhile, market monopoly and legal/ethic...
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