Strengths and Weaknesses of International Outsourcing - Coursework Example

Strengths and Weaknesses of International Outsourcing Strengths and weaknesses of international outsourcing No country is capable of sustaining itself independently if it were not for the issues of international outsourcing. For instance, in the United States, some of the services such as labor and technical expatriates are often outsourced across the world with a perception to help expand or improve their economy. However, as long as this may be seen to enhance positive impacts to that county and its members of the society in particular, some of the citizens feel that outsourcing has negative impacts especially in areas of employment because it minimizes job opportunities, which could have otherwise been made available to the Native Americans. This paper is, therefore meant to research on both the positive and negative effects of international outsourcing to the Americans citizens. According to Jacques (2006), International outsourcing constitutes hiring of specific business activities that is either existing for a shorter duration or in professional areas that are too expensive to be handled by the internal companies. Most articles have pointed out that, American companies outsource labor expatriates, logistic and recruitment services across their borders. The issue of international outsourcing has been facilitated in America due to insufficient labor expatriates in the industrial sector. Besides, some companies consider international outsourcing as a leeway of cheap labor acquisition without negation of the quality results while the rest of the firms do it to create room for concentration on other areas of important (Barrar & Gervais, 2006). Strengths of international outsourcing to American citizens Putting into consideration the success of any business or a franchise, essential business aspects such as economics and the cost of labor are given priorities because they directly influence the cost of production, which in turn affects the overall business returns. Therefore, one of the best ways of improving America’s economic productivity is by internationally outsourcing all the necessities that help in the sustenance of the national economy while ensuring that it does play to the undoing of the of the American society (Schniederjans, 2005). Ensures economic sustainability Since international outsourcing always ensures consistent provision of opportunities to experienced personnel, it helps companies to remain lucrative and attractive to the investors because such firms are believed to be financially stable. In return, firms improve the economic margin while ensuring national sustainability throughout the United States. Besides, international outsourcing provides a pool of sources of labor to the United States companies. Hence, there is always a vast number of employees to choose from. Such considerations increase the rate of competitiveness forcing employees to acquire appropriate skills that fit the highly competitive market demands (Schniederjans, 2005). Reduces risks potentiality International outsourcing acts as one of the most essential determinants in calculation the company’s risks analysis in different countries and the united state is not exceptional. Taking into account that certain risks may pose tremendous loss to a company and a country in general, sourcing of additional services across the boarders helps to delegate the chances of evitable risks to the contracted vendors or business expatriates. In this case, contracted personnel are of often more experienced thus protecting both the company and the United States in particular while enhancing economic sustainability of whole citizens (Schniederjans, 2005). Generates a pool of labor expatriates across the world International outsourcing is also beneficial to the United States citizen by availing abundant labor output to the nation. Due to such availability, most companies in the United States often have varieties of Manpower enabling recruitment of the most competitive and experienced personnel. In turn, employees are forced to work extremely harder in order to deliver as per the required standards of the nation, the same way they could have done could have done in their native countries. Besides, the United States government has set up policies and standards, which ensure that any international outsourced laborer meets some specific standards. Putting into consideration the issues of remunerations, payments are slightly higher when contracted a Company in the United States as compared to countries oversees. High salaries abroad therefore create a room of competitiveness thus forcing international companies to work harder to attain high level of productivity (Patel & Aran, 2005). Highly affordable Quite similar to most countries in the western region, the United States outsources as an alternative for cheap or affordable labor. Similarly, it is an appropriate strategy in saving the company extra amount of money in terms of projects cost or employee wages. Outsourcing also does away with the issues of internal recruiting that is often characterized by addition expenses. Therefore, opting to recruit across the borders saves companies in the United States operational costs by a wider margin. Additionally, companies in the United States find it cheaper to outsource personnel across the borders because it is much affordable as compared to hiring Native Americans because it saves the country extra recruitment expense that are then repatriated to assist in another area of operations. Moreover, the amount of money that an company saves by outsourcing expatriates internationally can be used to hire more workers quite easily and affordably (Patel & Aran, 2005). Helps in the reduction of the learning curve Contractors hired across the boarders are perceived to have the best technical experiences in handling specific tasks as such it helps the contacting company in reducing costs that are incurred while orientating new permanent employees in understanding the details of the company. From this concept, it is clear that most independent contractors are more competent and can handle more than one task thus reducing the cost of hiring an additional worker in similar area of operations (Patel & Aran, 2005). Weaknesses of outsourcing to the United States Through the manifestation of highest negativity, any job opportunity that has been allocated for an oversee expatriates, another employee must have been laid off in the United States. Such kind of movement enhances poverty to locals and their relatives who end up languishing in poverty after losing such opportunities. In addition, international standard of performances vary considerably and this makes it quite difficult for foreign contractors to perform to the standards of the United States employees. Persistence will automatically lead to low quality output (Sitkin & Bowen, 2013). Risk of leaking private information to the competitors Some firms delegate services such as recruitment, payments or appraisal services to companies overseas. This exposes company confidential details characterized by threat of leaking information to its competitors. Besides, most contracting companies are believed to violate the ethical labors wages. For instance, in the United States as long as outsourcing companies may pay substantially higher rates as compared to native firms, the reality is that what the employees earn only little amount of money to sustain their daily life. From the above context, it is believed that such companies overlook the ethical responsibility subjecting the employees to lifestyle more or less similar to slavery. Inappropriate concentration on customers’ demands Most of the international contracted firms never rely on a single company since they always work to increase their coverage capacity. With this respect, working for more than one company increases their chances of reduced concentration on the customers’ needs as such, leading to low quality production in the United States (Sitkin & Bowen, 2013). Language barriers Since the United States use English as the native language whereas, immigrants use their own language based on their culture, the difference poses a bigger economic threat when their services have been sourced by the United States. Besides, sources have confirmed that immigrants are often met with the problem of language difference thus lowering their economic productivity (Sitkin & Bowen, 2013). Conclusion From the above strengths and weakness of international outsourcing to the United States, it advisable that any company in the United States should take keen analysis of before outsourcing services of an eternal firm. Such an effort is considered substantial to avoiding risks of productivity and economic degradations. Besides, a company should also be specific on the kind of activity they would want to outsource, as this would make it easier to in identification process during the bid for outsourcing. References: Barrar, W & Gervais, R. (2006). Global outsourcing strategies: an international reference on effective outsourcing relationships. Aldershot, England; Burlington, Vt.: Gower. Jacques, V. (2006). International outsourcing strategy and competitiveness: Study on current outsourcing trends. Paris: Publibook. Schniederjans, M et al. (2005). Outsourcing and in sourcing in an international context. Armonk, NY [u.a.]: Sharpe. Patel, A & Aran, H. (2005).Outsourcing success: the business imperative. New Delhi: Tata McGraw-Hill. Sitkin, A & Bowen, N. (2013). International business: challenges and choices. Oxford, United Kingdom: Oxford University Press. Read More