Bus 303 Chris Outsourcing

Bus 303 Chris Outsourcing
A practice used by different companies to reduce costs by transferring portions of work to outside suppliers rather than completing it internally. Outsourcing or ‘offshoring’ is an effective cost-saving strategy when used properly. It is sometimes more affordable to purchase a good from companies with comparative advantages than it is to produce the good internally. (Investopedia, 2012)


 
Article: Global outsourcing (Outsource 2 India, 2012)
 
 
 
Global outsourcing, also coined as ‘offshoring’ is enabling business without barriers in a borderless world. As enterprises think global, their outsourcing models have changed to follow suit.
 
 
 
Outsourcing is no longer just a short term quick-fix to achieve cost reduction. Global outsourcing uses a blend of onsite, offshore, and nearshore outsourcing solutions to achieve strategic business objectives for the outsourcing company. Today, there are job titles like "Chief Globalization Officer" and "Strategic Services Manager" - which just goes to show that organizations are taking seriously the impact of global outsourcing on the revenue growth and business value of their companies.
 
 
 
As the demands of customers increase, competition gets more intense and product life-cycles shrink, there is increasing pressure on operating margins. The complexity of global cross-border business management presents new challenges as companies try harder to stay agile, profitable and innovative. Business processes need to be flexible and adaptable to enable people to respond faster to changing business needs. Services outsourcing must be aligned to business goals, rather than be seen as just a tool for enhancing operational efficiencies. (Outsource 2 India, 2012)
 
 
Article Discussion:
 
 
 
Most companies, who choose outsourcing whether global or local, usually choose outsourcing to reduce costs. While I agree that reducing costs makes sense, outsourcing by its very nature displaces workers for cheaper labor. An alternative to displacing workers is ‘ right-sourcing.’ This practice uses outsourced labor to augment and blend with existing staff. This practice minimizes staff displacement. I believe that there is value in both sourcing locally (within the US) and sourcing globally. The benefit of this is that outsourcing helps build strong relationships locally and globally. If the practice is implemented correctly, I believe that we will continue to see an exciting evolving marketplace.