...In this week’s video, outsourcing is being discussed. In this case, outsourcing is the process of companies obtaining goods and services externally as opposed to doing it themselves. The primary benefits are that companies can become more efficient and cost-effective by doing so. Initially, these may be the primary motivators to outsource, but additional benefits could include better operation control, staffing flexibility, continuity and risk management, and the development of internal staff by temporarily subcontracting new people into the company who could eventually work next to existing employees and train them with a new skill set (operationstech.about.com). The first company, Teleradiology Solutions, which began in 2002, transmits images such as CT’s (computed tomography), MRI’s (magnetic resonance imaging), and x-rays from their home base in Bangalore, India to other parts of the world, particularly the United States, Europe, and Singapore. The company is looking to expand to other places such as Africa. They specialize in elective or subspecialty imaging and the turnaround for reports is generally within 30 minutes. Teleradiology Solutions uses a unique radiology workflow intelligence system called RADSpa ™ (telradsol.com). The second company, ScanCafe, started out as a class project at the Wharton Business School at the University of Pennsylvania. They scan and enhance old photographs. Increasingly, they are hiring high-end designers to design photo books. Originally...
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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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...Outsourcing Jobs I think it is interesting to know the positive and negative arguments about outsourcing. On one hand, there is the current uproar about illegal immigrants swarming in to the U.S. to do the jobs that Americans don’t want to do. And on the other hand, there is the continuing outcry about jobs going overseas. This would be the outsourcing of jobs that Americans would be willing to accept if the corporations were not so adamant about improving their bottom line for their stockholders. So, what is outsourcing and offshore outsourcing? By definition, “outsourcing (or contracting out) is often defined as the delegation of non-core operations or jobs from internal production within a business to an external entity (such as a subcontractor) that specialized in that operation. Outsourcing is a business decision that is often made to lower costs or focus on competencies” (Miller, 2010). A good example of outsourcing is janitorial services. Instead of a company training several people for the position, they can outsource these tasks to another organization that specializes in recruitment services. This way they can save the time from hiring and training, and the work output should be of the highest quality. Offshore outsourcing is referred to as, “work done for a company by people in another country that is typically done at a much cheaper cost” (Miller, 2010). These services are outsourced elsewhere to countries other than where the goods and services are actually...
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...IT & ITeS April 2010 IT & ITeS April 2010 Contents Advantage India Market overview Industry Infrastructure Investments Policy and regulatory framework Opportunities Industry associations 2 ADVANTAGE INDIA IT & ITeS April 2010 Advantage India • Freight costs in India are 20 per cent less, with faster delivery, as compared to China. • Proximity to the EU and the Middle East and Asian (MEA) market • Cost advantage Every year, 675,000 technical graduates qualify in the country, of which 400,000 are engineers. More than 50,000 MBAs graduate every year. It is estimated that India’s IT industry has added 40,000 employees in 2009–10. • More than 85 global SEI-CMM level 5 firms have a presence in India. India’s service offerings have evolved to high-end integrated IT solutions. Quality/ maturity of processes Advantage India Ease of scalability • Enabling business policy and regulatory environment • The cost of an engineer is about 20 to 40 per cent of the comparable cost in the European Union (EU). General, administrative and selling costs amount to around 80 per cent of comparable costs in the EU. India’s average offshore billing rates, at US$ 20 to US$ 35 per hour, are about 50 to 70 per cent lower than the EU’s. Sector deregulated in the 1990s to allow private sector participation. 100 per cent FDI is allowed under automatic route. Source: Department of Information Technology, Annual Report 2008–09 ;...
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...In response to the article on “Outsourcing Jobs: The Myths and Realities” by Martin N. Baily and Dian Farrell, it surprised me to learn there could be positive effects to the American economy as a direct result of outsourcing jobs overseas. Typically, I have read mostly about the unsatisfactory results that are given attention in the daily headlines. Jobs sent overseas means less jobs here at home; where does this leave the common American worker in the wake of this economic shift? After reading this article, I’m having a difficult time accepting there can be a positive effect to this transition. Since the emergence of outsourcing or offshoring, in the 1990’s, corporations have been implementing the allocation of resources in increasing numbers. In the beginning of this article, it details how much U.S. companies are saving by shipping white-collar jobs overseas. “For every dollar of corporate spending that moves offshore, American businesses save 58 cents. Companies can reinvest the savings in new business opportunities, pay additional dividends to shareholders, or both. Moreover, because wages are lower in the relevant foreign labor markets, companies can hire more (as well as better-qualified) workers to do the same job, and spend more on supervision and training (Baily and Farell, 2010).” This, in theory, sounds like a win-win situation, for both the U.S. and foreign economy where the jobs are being created in. U.S. Companies cut costs, and countries, like...
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...While information technology outsourcing in general is not a new concept having been in existence in facilities management for several decades, global software outsourcing and global software development via offshore subsidiaries is a relatively more recent phenomenon becoming visible only in the early 1990s. The growth of interest in these arrangements is in part due to the pervasiveness, improved efficiency and reduction in cost of communications technologies. This is coupled with the pressure that North American and European companies are experiencing to look globally to meet their current software development manpower shortages. Companies such as Xerox and Kodak have internationally outsourced major pieces of their information systems operations and while such positive experiences are given prominence in the popular press, other not so-successful global software outsourcing experiences are often overlooked. One of the major reasons for the growth of global software development is because unlike material goods, digital information can be transported cheaply and easily. Software development tasks can be exported abroad for potentially increased access to advanced technological expertise and for reduction in costs. There are two major categories of global software outsourcing: “information systems related” and “information processing related” services. While the first category includes software development and maintenance activities, the second concerns the more routine data...
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...Satyam is a company that specializes in information technology, business services, computer software, and is a leading outsourcing company in India. The company grew quickly during the 1990s and 2000s as more and more companies around the world looked to India for outsourcing solutions. It eventually became the fourth largest outsourcing company in India. Satyam provides solutions to approximately 185 Fortune 500 companies throughout the world. The business community recognized Satyam as a global leader in information technology outsourcing. Satyam was as an example of India's growing success. It won numerous awards for innovation, governance, and corporate accountability. Unfortunately, less than five months after winning the Global Peacock Award which is a World Council for Corporate Governance, Satyam became the centerpiece of a massive accounting fraud. As stock markets around the world collapsed during 2008, the Indian Stock Exchange fell enormously. The enormous losses caused investors to withdraw large amounts of cash from their investments. These cash withdrawals in turn triggered the discovery of several cases of financial fraud as perpetrators could no longer hide the results. Mr. Raju, the founder of Satyam, and the company's global head of internal audit used a number of different techniques to perpetrate the fraud. He created numerous bank statements to advance the fraud and falsified the bank accounts to inflate the balance sheet with cash balances...
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...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, and academics. In the first of these categories, one book which has enjoyed remarkable...
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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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... DR. Elaine, Bontempi November 15, 2008 India and the United States Abstract India will become the most populous nation by 2030. Thanks to the fast growing software and IT revolution, India is changing its role around the world as formable economic competitor. Despite these achievements, it should be noted that employment growth in the Indian services sector has been quite modest, underscoring the importance of achieving rapid industrial and agricultural growth. Poverty and the threat of HIV/AIDS are threatening India at a very alarming rate. In contrast, the United States houses about 4.6 percent of the world’s population, which was estimated to be nearly 6.5 billion at the end of 2005. United States is the world’s third most populous country, trailing China (1.31 billion) and India (1.08 billion). The transformation of the global economy in the last decade, fostered by the spread of the Internet and other information technologies, has significantly changed this equation for the United States, instead of leading the world in information technology...
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...Running Head: OUTSOURCING FRIEND Outsourcing Friend [Name of the writer] [Name of the institution] Outsourcing Friend Introduction Outsourcing rumors are certain to set off pandemonium amidst workers in an IT organization. Though outsourcing may appear like management’s shortsighted entails of chopping charges, proceed of working out the pros and cons of meting out certain enterprise methods can have genuine advantages for your organization. The key is to perform a methodical outsourcing analysis. Why Not Outsource? Having taken a good gaze at both edges of the proverbial barrier, there are numerous scenarios where outsourcing can work as well as positions where it won’t explain a thing. For starters, there’s finding the right outsourcer, which you’ll rapidly find out is just a little part of the puzzle (McDonald, Jacobs, 2005). Nearly any outsourcer can make a powerful case, but with a correct investigation of your present methods, an identically, if not more powerful, case can be made for holding the enterprise in-house. If you have not ever finished this kind of investigation before, it can be a genuine discovering experience. Keep an open brain and you may find that there are positions where outsourcing makes flawless sense for your enterprise by setting free up some of your interior assets for more significant and perceptive efforts. USA vs. the World The most prominent and democratically ascribed tendency has been...
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...4thblock-Koramangala | Babu catering services | V.V Puram | NAMMURA HOTEL | 4th block Jaynagar | Hotel Nandini catering services | 6thphase-J.P Nagar | Bhavani Caterers | 9thblock-Jayanagar | Sri Annapoorneshwari Caterings | Kumar Swamy layout | Leela Caterers | 2ndphas-J.P Nagar | Svs Caterers & Tent house | Hanumath Nagar | OBSERVATION 1: Name of catering agency | No. of sales personnel | Customer GroupMin-Max | Outsourced Services | Service Charges (Per Plate) | Purnabrahma catering services | 20-80 | 100-1200 | Tent, utensils , ice creams | Rs.250-900/- | Distribution Channel 1: Inferences * The owner itself is order-taker for wedding purpose and office gatherings. * Two managers appointed one for Outsourcing and other for other services. * Average 30-40 people needed to execute one catering order. OBSERVATION 2: Name of catering agency | No. of sales personnel | Customer GroupMin-Max | Outsourced Services | Service Charges (Per Plate) | Govind Caterers | 35-65 | 120-1000 | Decoration, Tents, Water | Rs.200-750/- | Distribution Channel 2: Inferences * The firm has delegated their work into two parts Order Taker and Order Executor * The process to execute one catering order takes almost one week. * Approx 40 people needed in Average wedding order OBSERVATION 3: Name of catering agency | No. of sales personnel | Customer GroupMin-Max | Outsourced Services | Service Charges (Per Plate) | Sri Nandini caterers |...
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...------------------------------------------------- Tata Consultancy Services Tata Consultancy Services Limited | | Type | Public company | Traded as | BSE: 532540 NSE: TCS | Industry | IT services IT consulting | Founded | 1968 | Headquarters | Mumbai, Maharashtra, India | Area served | Worldwide | Key people | Ratan Tata (Chairman) S Ramadorai (VC) N. Chandrasekaran (CEO & MD) | Products | TCS Bancs Digital Certification Products Healthcare Management Systems | Services | Outsourcing BPO Software Products | Revenue | US$ 8.355 billion (2011)[1] | Profit | US$ 2.024 billion (2011)[1] | Total assets | US$ 7.215 billion (2011)[1] | Total equity | US$ 5.499 billion (2011)[1] | Employees | 2,15000 (May 2011)[1] | Parent | Tata Group | Website | TCS.com | | | Tata Consultancy Services Limited (TCS) (BSE: 532540, NSE: TCS) is an Indian IT services, business solutions and outsourcing company headquartered in Mumbai, India. It is the largest provider of information technology in Asia and second largest provider of business process outsourcingservices in India.[2][3] TCS has offices in over 47 countries with more than 142 branches across the globe and is a subsidiary of textiles and manufacturingconglomerate Tata Group. ------------------------------------------------- History It began as the "Tata Computer Centre", for the company Tata Group whose main business was to provide computer services to other group companies. F C...
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...Outsourcing is affecting the U.S. economy greatly. Outsourcing is taking away jobs from the American people causing a rise in the unemployment rates. Not only is outsourcing taking away jobs, but it is making it harder to find new jobs. Outsourcing is where an American company will send certain jobs or duties to be done in another country. Outsourcing is also the transfer of the management, and also the day by day execution of an entire business function to an external service provider. It is a company’s practice of paying an employee in a small developing country to perform a function or produce a product that could be made by the paying company. Business jobs that are typically outsourced include information technology, human resources, facilities and real estate management, accounting, Customer support and call center functions, like telemarketing, customer services, market research, manufacturing and engineering. Outsourcing has become one of the fastest growing trends in the business world. There are many reasons that a company would elect to use outsourcing. Among them is the fact that it provides an almost immediate opportunity for savings as well as a noted improvement in quality. The main reason why American companies are doing this is to save money. It’s cheaper to have someone form a developing country do the job because a dollar goes a lot further than in the states. One management problem that is causing outsourcing is that companies are looking for ways to cut...
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...Analysis: Bharti Airtel | | Introduction Bharti Airtel Limited is a major Indian telecommunications firm, with a particular focus on operating in the mobile services market. Founded in 1995, the company quickly tried to exploit growth opportunities arising from the liberalization of Indian telecommunication markets. The family owned business was soon able to generate profits and extend market shares. However, the pace of company growth challenges the firm in terms of being able to setup the necessary infrastructural elements, both within the firm as well as outside the firm. Therefore Bharti considers “reverse outsourcing” of IT infrastructure and network setup and maintenance to well-established firms from developed countries, such as IBM, Nokia and Siemens. This case analysis examines the proposed outsourcing deal both from the perspective of Bharti and from the perspective of potential vendors in order to find the most appealing solution for both parties. First, we talk about the success factors in the Indian mobile phone market and Bharti’s core competencies. Second, we will look into the outsourcing agreements outlined by Gupta and discuss the advantages and disadvantages of such agreements. Furthermore, we will discuss the question of how the contracts might affect Bharti’s core competencies. Third, we want to elaborate on the major concerns about entering in an outsourcing agreement with Ericsson, Nokia, Siemens and IBM respectively. Additionally, we propose...
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