Outsourcing Term Paper Example | Topics and Well Written Essays - 2000 words - 1

Outsourcing - Term Paper Example focus more on core competences, allows organization to provide products and services to consumers on much cheaper rate, it allows best utilization of time and factors of production, and with activities it also transfers the risk attached to those activities. With advantages, outsourcing has some disadvantages as well, which includes Increase in unemployment in outsourcing country, it often eradicates direct communication between an organization and its clients which hinders organization to build strong relationship with employees, it rises the risk of losing control over operations, it makes the sensitive information vulnerable as chances of leakage of information increases with outsourcing, and it makes organizations largely dependent upon the outsourced partner (Bettis, Bradley, & Hamel, 1992). There are number reasons which explain why organizations outsource their functions and business processes, one of the basic and major reasons is that it saves money and allows organization to pool that money in more productive activity There are many things which companies consider while looking to outsource as the success of outsourcing such as, Companies’ capability to manage in mobile locations; Companies’ capacities to expand and to build outsource partnerships, and companies’ skills and abilities to what to produce and not to produce while being competitive in the market (Boudreaux, 2008). There are number of exogenous factors which also need to be considered by companies while looking for outsourcing, which are Political stability of a country where function or process is outsourced, Language skills of outsourced partner, Infrastructure stability of outsourced partner, and flexibility of intellectual property rights and business contracts in the country of outsourced partner. Companies should concern about handing over technology to other businesses as this practice is quite worrying for them who outsource functions or business processes in order to save