Aspects of Outsourcing
CMGT 578/CIS Strategic Management
May 19, 2014
In this paper the aspects of Outsourcing will be discussed in great deal and the aspects will include what are the determining factors in an organization deciding to outsource. One such reason most organizations choose to outsource is that they see an opportunity to cut unnecessary cost. Also the risk involved in outsourcing will also be assessed, one such risk is that company information is no longer private and the partners you chose to outsource to now have access to all your company information. Trust and professionalism is important in choosing to outsource to a partner. The benefits of outsourcing will also be discussed in this paper. I will describe in detail the methodology behind outsourcing and the business behind outsourcing.
When determining whether an organization should outsource they consider many factors and one such is very well none and that is reduction of cost. This also affects projection timelines, project timelines are reduced and also the cost of labor is cheaper. Many organizations that choose to outsource choose to do so because the rate of pay is significantly lower in the area where they would outsource their labor too. Another determining factor in the decision to outsource is organizations do not have to hire specialists or experts who only dabble in complex processes and they are only hired part time to complete particular parts of the project. When outsourcing an organization does not have to hire permanent personnel for the length of the project which in turn saves the company money because they don’t have to worry about that permanent cost to employees’.
Some factors that may influence a Manager to not outsource a piece of work or an entire project to vendors is the language barrier. When outsourcing from the United States we typically outsource to countries like China and India With the decision to outsource to these countries we understand...