...Outsourcing: The Government, the People and the Companies Jeffrey W. Coleman Webster University Abstract Making a decision about whether or not to move these activities offshore is a decision of far-reaching consequences. Developing countries have been unable to radically alter their industrial structure due to numerous internal institutional and external technological barriers. Consequently, they have sought global participation through outsourcing activities. This is indeed a break from the traditional self-reliant way of doing business. Outsourcing arrangements are technologically and organizationally complex, and present a variety of challenges to manage effectively. Outsourcing benefits include cost savings, quality improvement, and the ability of the organization to concentrate time and resources on its core business. Outsourcing trends change from year to year, and usually involve changes such as progressive outsourcing, cloud sourcing, mergers between organizations from different parts of the world and protectionism. In this paper we will look at a few of these areas such as the how in recent years the business practice of outsourcing jobs has been considered both a blessing for American business and a concern for the American worker, the amount of outsourcing being done and why, the affect on the economy in the United States, and the role government plays in outsourcing. The paper concludes, however, that the trend is just beginning and how our country...
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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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...Shalone Brown Professor Carol Bruzzano English 101 30 September 2013 Outsourcing “Our great history has been that people came to Michigan because you didn’t have to have a college degree to get a good paying job. Consequently, we have got a larger number of our population that right now are facing outsourcing, et cetera, without higher or advanced degrees.” Jennifer M. Granholm the former Governor of Michigan made this statement. In the past many Americans were able to provide for their families with low skilled jobs. However, during current times, these particular jobs are rapidly leaving our economy and entering the world economy. A simple definition of outsourcing is to obtain goods or services from an outside or foreign supplier. Outsourcing is beneficial to the world economy and companies but its having a reverse impact on the American economy and its citizens. America is one of the main contenders in the outsourcing arena, and many of our low skilled jobs were given to struggling countries. Although we lost these jobs the higher end jobs were to say here in America. Companies usually send customer service jobs, claims processing job, transcription jobs etc. to foreign economies. But, higher end jobs such as IT positions and journalism opportunities are also leaving us and going into the global workplace Outsourcing allows individuals in other countries employment opportunities. By sending these jobs to foreign lands we are helping to boost their economies, and raising...
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...Timmy Throntveit Organizational Theory September 21, 2014 Research Paper: Outsourcing Outsourcing is the practice used by different companies to reduce costs by transferring portions of work to outside suppliers rather than completing it internally (Investopedia). Why do many organizations outsource their business overseas to countries like China or India? Outsourcing is an effective cost-saving technique when used properly. Outsourcing is sometimes more affordable to purchase a good from companies with comparative advantages than it is to produce their products internally. China and India are the fastest growing economies around. The most obvious reason is the reduced costs. Wages for skilled workers are lower in developing countries such as China or India. The outsourcing of American jobs has become one of the biggest topics in the United States. The country's working class faces pressures which they have not experienced since the Great Depression of the 1930s (Magdoff, Foster). Outsourcing continues to have several different opinions from many individuals. On one side of the topic, many are in support due to the low cost for companies. The main reason is outsourcing boosts the United States economy. On the opposing side, many are opposed to outsourcing because of the reduction of jobs in the United States and a variety of other factors. The focus on outsourcing has led to many companies being shipped to foreign countries like China and India. With the rise of technologies...
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...Offshoring, also known as offshore outsourcing, is the term that is used to describe the practice among companies located in the United States on contracting businesses beyond U.S borders to perform services that would otherwise have been provided by in-house employees in white-collar occupations. The term can be applied to U.S. firms that are offshoring the jobs of blue-collar workers on textile and auto assembly lines, for example, which has been taking place for decades. The extension of offshoring from U.S. manufacturers to facilitate providers has heightened public policy concerns about the extent of job loss and foregone employment opportunities among American workers. This concern was especially relevant to policymakers because of the national unemployment rate persistently exceeding 9% despite the end of the Great Recession in June 2009 . The outsourcing of service sector jobs from the United States was a response to the early 1980s recessions when employers narrowed their focus to the company’s core mission and contracted peripheral activities (e.g., janitorial duties) to other U.S. businesses. The 2001 recession caused employers to seek further efficiencies by tapping into the global supply of labor. U.S. businesses were able to outsource overseas the jobs of white-collar workers in some service providing industries as a result of widely disseminated technological advances that permit low cost, good quality, and high speed transmission of voice and data communications...
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...The Trend of Outsourcing Jobs Did the major companies in America not think of global competition as they started to expand their operations and increase the salaries of the workers? Why is it such a hot topic now, why didn't this act of outsourcing start long ago? What effect does outsourcing have on the American economy, will we be able to stop this trend, and if so what will be the effect. In this paper I will be looking at and discussing why companies are outsourcing the jobs overseas. What benefits that companies are getting out of it, and the problems that face management, as outsourcing seems to be the trend of big business. INTRODUCTION Outsourcing is the delegation of tasks or jobs from internal production to an external entity (such as a subcontractor). Most recently, it has come to mean the elimination of native staff to staff overseas, where salaries are markedly lower. There has to be a reason that companies are going to outsourcing rather than hiring people within their own country. The bottom line, the single thing that drives every company in the world. What ever can increase the bottom line you can expect that companies will do everything possible to reach higher profits. Living in Michigan almost my whole life, and being feed from the hand of General Motors outsourcing hits close to home. I feel that the one thing that has increased outsourcing is the results of the union. Back in the time when the union started I believe what they were doing was something...
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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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...report is written in efforts to evaluate ethics of outsourcing and the dilemmas involved. | Ethics of Outsourcing Outsourcing has been the target of many positive as well as negative topics amongst many Americans. The United States economy has taken many hits and efforts to reduce costs have resulted in increased outsourcing in labor as well as service industries. The ongoing debate of whether outsourcing is unethical does not fall only in the act of outsourcing itself but also in the terms to which outsourced employees are treated. The question of whether mass layoffs are justifiable or ethical toward employees who are dedicated to corporations for so many years and whether resorting to illegal labor is ethical are also derivatives of outsourcing. We continue to ask ourselves if this form of cost reduction and its effects on the U.S. employees morally ethical? In these challenging economic times, there has been a large array of speculations towards the subject of outsourcing jobs to other offshore destinations. Outsourcing has been going on around the world for a large amount of time before now. Though it seems to be more of a negative topic of discussion during the fall of the American economy, it is important to realize the positive global impacts it has created. It is still considered a morally challenging topic, but there are both advantages and benefits that are being reaped around the world from outsourcing. Outsourcing has been a leading marketing tool for allowing...
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...Thesis: American labor markets are in decline because of global outsourcing which has created jobs overseas, with fewer regulations for the environment and lower costs of operation. Introduction: Outsourcing can happen to almost anyone. It happened to me. I woke up like any other morning. Went to McDonalds for a cup of coffee and then headed to work. Unlike every other morning though I came to work with my department shut down with no warning and an emergency meeting to tell us that we have been outsourced and are not longer needed. Many American jobs everyday are being outsourced to other countries thus hurting the economy of America and the countries that are getting the jobs. Outsourcing is the practice by which a company hires another company to do some aspect of its work. In this presentation I am going to talk to you about three main points: What are the benefits to companies pursuing an outsourcing agenda, the drawbacks to companies pursuing an outsourcing agenda and the drawbacks to the U.S. economy of the pattern of outsourcing. I. What are the benefits to companies of pursuing an outsourcing agenda? a. According to Farrell (2002) At the top of the list, is the financial impetus. To date “cost savings are still a key outsourcing benefit,” with the reduced cost of transferring labor to external settings or even overseas, coming from the access to new markets. (Farrell, 1) b. In the IT world especially, this benefit is paired with...
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...13, 2004.) Fear of losing jobs to offshoring (rise in unemployment), but computers and technology may take these jobs anyway. “Has the machines in its last furious manifestation begun to eliminate workers faster than new task can be found for them?” Article says not to worry. The United States has experienced an increase in the offshore outsourcing (offshoring) of jobs in the service industry. Although offshoring is common in the manufacturing industry, it only recently began in the service industry. The recent increase in the service industry has occurred because of new technology and the ability to access information from anywhere. Those who oppose offshoring believe it takes away American jobs, lower wages, and causes declines in America’s standard of living and any benefits from offshoring are unevenly distributed. Offshoring in the industry has not negatively affected the United States. Currently, offshore outsourcing in the service industry has a net benefit to society and there is no reason for concern. Critics charge that the information revolution (especially the Internet) has accelerated the decimation of U.S. manufacturing and facilitated the outsourcing of service sector jobs once considered safe, from backroom call centers to high level software programming. (This concern feeds into the suspicion that U.S. corporations are exploiting globalization to fatten profits at the expense of workers.) They are right that offshore outsourcing deserves attention and that...
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...Outsourcing jobs may lead to a weakened economy Anne Onyambu ENG 1000 Ms. Lorrinda Khan November 11, 2011 A popular theory states that something is not worth doing if it earns you less than your hourly wage, imputed or otherwise. For example, if you make $120 an hour and you can hire someone experienced to mow your lawn for $20 an hour then, you should go ahead and pay for the service instead of doing it yourself. This will leave you free to use your time where you can earn $100 an hour hence create more value for yourself and many others. Of course, you can mow your own lawn, but you will be losing a value of $100, if there is an opportunity to earn $120 an hour and can get someone experienced, who earns $20 an hour to do your lawn. This is the essence of outsourcing, to save costs and hence create increasing value for stakeholders in organizations. The prevailing trend of outsourcing to foreign countries has become an issue of major concern of all representations of the common people all over the world. Specifically, in America, outsourcing of American jobs has become a big topic. Many jobs are being outsourced to other countries, like China, India, resulting in job scarcity and leaving the American population unemployed. Outsourcing refers to the practice of contracting with third companies or vendors outside the organizations, usually in another country, to deliver products and services to local customers at a cheaper price. The practice of outsourcing is a...
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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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...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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...Kristen Ramer This day in age October 2012, there are many opportunities that present themselves to save companies money to be able to expand or grow. Outsourcing has become a hot topic with Americans and the majority of Americans are not thrilled with the idea. Americans that are not supportive of the idea may or may not have done their research to give them the facts to support their claims. What I am going to do is discuss the pros and cons of outsourcing and provide examples that can actually make or break companies who decide to outsource. Outsourcing is a strategic decision and the company ultimately has the final say, but the important decision may affect their reputation is that a chance they are willing to take? Airlines are extremely important in America, we are a country that travels nonstop and Airlines have become a necessity. I believe that some positions in the Aeronautical field could most definitely be outsourced, but the important question is what positions and at what cost? I think the best positions to outsource are the labor-intensive positions. For example the interior of the plane, putting fabric on the seats, assembling the seatbelts and all the other tedious work involved with setting up the airline inside the plane. I think outsourcing projects like this will ensure the customers are getting the best service and people that are able to communicate back and forth. I have been in a situation where I called for help with a technical problem...
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...What is outsourcing? We have all heard the term thrown around but what does it really mean? Outsourcing is defined as contracting, sub-contracting, or 'externalizing' non-core activities to free up cash, personnel, time, and facilities for activities where the firm holds competitive advantage(BD,09).Outsourcing happens when company’s choose to purchases their needed products and or services from an outside supplier ( mainly other countries), rather than doing the same work within their own facilities. Why companies outsource. The main reason companies outsource is because it saves them money. Many different types of jobs are outsourced, IT, telecommunications, auto manufacturers, physicians and so on. Outsourcing by General Motors to avoid high wages paid to auto workers was a major issue with the United Auto Workers union in the 1990’s. Companies view outsourcing as a way to drastically cut their cost when it comes to paying for supplies, facility’s and employees. Company’s also save money because they do not have to pay for healthcare or worry about keeping up with OSHA regulated standards. Here are the top five reasons companies outsource: 1. Reducing Costs - This is the number one reason why companies outsource. In most situations you can find cheaper labor through outsourcing and if the quality level is the same there is no reason why you should not outsource. 2. Improved Business Focus - By directing a part of the work towards outsourcing you gain flexibility...
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