Outsourcing Is Defined As Well As Trust Issues

Because many businesses in the US have more often began outsourcing different business products instead of doing them in-house, it is important to understand why outsourcing may be the best option. Although many tie outsourcing to foreign markets, outsourcing can include both foreign and domestic markets. By entering into a contractual agreement, outsourcing allows organizations to pay for services they need. This gives the option for a business to get professionals to perform services for them that the business may not have the staff for. Outsourcing provides a cost saving-strategy that is usually more affordable. Ultimately,

The U.S. economy has seen many hardships within the last decade. The economy has suffered from a recession that is still threatening to cripple some Americans and unemployment has been at an all time high. People have lost homes and jobs and many businesses have gone bankrupt simply trying to survive. However, in the midst of this economic crisis some companies have managed to survive. Many companies, approximately 36% of them, have found a way to avoid economic collapse by cutting costs (Job Outsourcing Statistics, 2014). One of the most popular cost reducing strategies of our time is called outsourcing.

It is a concept that has evolved from a manufacturing perspective to a strategic perspective, which views the concept as a way for organizations to focus and be more competitive. The basic premise of outsourcing is that a specialist organization can perform a particular service more efficiently than can internal operations because a specialist organization has an inherent advantage in producing and delivering a service. Superior technology, management skills, or economies of scale may contribute to this perception. The type of sourcing relationship depends on whether a long-term or short-term need exists. To save funds used for benefits for regular employees, temporary workers are hired. In this case, the organization (outsourcer) provides all necessary resources except the workers, who are provided by the vendor. For long-term services, the vendor has full responsibility for delivering the service; the outsourcer provides only a liaison.

“Outsourcing refers to the practice of contracting workers outside of a company or business for work duties or services previously performed by company employees or “in-house”. This practice is also often referred to as offshoring due to the increasingly prevalent use of “non-U.S.” service providers for these outsourced duties. However, strictly speaking, outsourcing can and does refer to the use of contracted labor provided by individuals outside of an organization, but still within the U.S.; whereas when these same services are provided outside the U.S., it is both outsourcing and offshoring.”

Outsourcing has become an integral part of many organizations today. Outsourcing has its advantages and disadvantages that organizations will have to weigh to decide whether or not outsourcing is the best possible solution to their current problems and business operations. Outsourcing refers to the process of hiring external provider to operate on a business or organization function (Venture Outsource, 2012). In this case, two organizations or businesses enter a contract where there will be an exchange of services and payments. This paper will discuss the possible risks an organization may encounter in outsourcing in relation to the use of an external service

Outsourcing can be a means to perform the core functions of an organization effectively by having more time focused on the activities critical to the delivery of services to customer. The non-core activities are performed by the leaders in that area which will help to achieve better efficiencies. Outsourcing can substantially lower costs, help to access better technology and use innovative ideas etc.(Robert,2001). The advantages of outsourcing are: Cost savings:

Outsourcing is a process of a company obtaining the services from an outside vendor. These services can be of different forms like IT services for a software company, voice services for a customer support industry, legal services for companies and small part suppliers for manufacturing companies etc. The main reason for a company to outsource its services is cost savings

What is ethics and how is it related to today's world of business? Merriam-Webster's Online Dictionary defines ethics as "the discipline dealing with what is good and bad with moral duty and obligation." In today's globalized society, it seems as though monetary profits are valued higher than making ethical decisions. Outsourcing has become an unavoidable result of globalization. From General Motors to IBM, we can experience the effect of outsourcing in many different sectors of our lives. Outsourcing has brought many economic advantages, and it has greatly enhanced productivity and growth of industries across countries. However, despite such benefits, outsourcing also generated a variety of social, political,

economy. Outsourcing leads to the fragmentation and disintegration of the supply chain, inviting new competitors into the industry, and undermining pricing power and profitability. For instance, is feasible only if it can be separated from other supply chain activities: product development, branding, marketing, distribution, and after sales services. Consequently, the more and more activities outsourced, the supply chain turns from a single integrated process performed within the boundaries of traditional corporations to a fragmented process, performed across several independent subcontractors. Another disadvantage, outsourcing’s unintended consequences extent to company relations with another partner—valued customers. Customers may feel betrayed in each and every activity is outsourced. If I hire Home Depot to make certain improvements in my house because they have reputation to reliable services, I would feel betrayed if I get services from a strangers hired by Home Depot. And I will feel even more betrayed if I end up discussing my medical or financial records with overseas strangers. What seems to be trendy and virtually in business strategy is not always a good

In business, the outsourcing involves the contracting out of a business process to another party. In this case, USTech has outsourced its product to TaiSource. As a result, USTech enjoys TaiSource’s world-class research, design, and lower manufacturing costs. USTech gets the benefits of direct sourcing in China without the hassle of coordinating it. But this behavior has some inherent limitations. USTech is afraid that TaiSource could reap its confidential information and start its new brand in Mainland China. Therefore, a global enterprise should weigh the pros and cons of its outsourcing strategy.

“Outsourcing worked. Using external service providers to cut costs and improve performance has become truly commonplace. As much as the popular press has focused on the debate over the benefits of

(Greaver, 1999) proclaims that outsourcing is of a strategic nature and that the decision-making process of a company should take this into account. He then goes on to define outsourcing as the act of transferring some of company’s recurring internal activities and decision rights to outside providers, as set forth in a contract. Because the activities are recurring and a contract is used, outsourcing goes beyond use of consultants.

As companies look for ways to strategically perform better in their respective industries many chose to outsource job functions. Outsourcing allows companies to grow and expand their business around the world. Many have attributed outsourcing to lowering operating costs, a method to increase expertise and gain additional technology, and as a way to improve efficiency and services. These advantages can help a company gain a competitive advantage over industry participants. When a company strategically plans to outsource ethical consideration must be acknowledged; especially when outsourcing is offshore.

Exploring the Internet for outsourcing information consistently leads to the obvious. For example, outsourcing has become a major element of the high-tech startup environment over the past couple of years. There have been (and are) many new high-tech companies trying to convince low-tech companies of the advantages of e-business. Indeed, many high-tech outsourcing marketers touted services to their high-tech peers, proclaiming the advantages of focusing on their high-tech core-business while outsourcing everything else. Of course, much of this was easier to sell prior to September, before security and reliability became a central concern throughout the industry.

In the past decade the topic of outsourcing has become a heavily debated subject on if it is ethically correct to outsourcing jobs to foreign countries. Outsourcing has become more and more an option for many companies and not just an economic fad. The decision to outsource is a difficult one for any company to make because there are many advantages and disadvantages to consider. The decision to outsource affects many people, communities, and industries so if a corporation decides to outsource they must consider how it will affect human dignity, the common good of the economy, and subsidiary.