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Evidence to support that the benefits of outsourcing and/or off-shore outsourcing outweigh the disadvantages - Essay Example

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Management Essay Introduction Outsourcing is a process through which national and international business firms transfer or outsource and their low end or non-critical business processes to some other firms. It offers strategic move to the business firms with an opportunity to gain strategic or competitive advantage in the long term…
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Evidence to support that the benefits of outsourcing and/or off-shore outsourcing outweigh the disadvantages
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Extract of sample "Evidence to support that the benefits of outsourcing and/or off-shore outsourcing outweigh the disadvantages"

Download file to see previous pages Evidence to support that the benefits of outsourcing and/or off-shore outsourcing outweigh the disadvantages The concept of outsourcing has gained immense popularity and recognition in the field of information technology, legal, logistics, manufacturing, technical and customer support. There are various reasons or advantages responsible for motivating or encouraging firms or companies to outsource or get their work done through other players or partners. It is well known fact that every concept or technology contains some drawbacks and limitations acting as a hindrance in the path of successful accomplishment of the respective concept or technology (Tate, Ellram and Lisa 2012). The case of outsourcing is not an exception. It also contains various limitations or disadvantages creating negative impact on the benefits and effectiveness of outsourcing. However, technological advancement and enhanced security control features has provided new dimension and height to the concept of outsourcing. The outsourcing becomes more effective and filtered with the emergence of enhanced security control features and technological advancements. ...
The growth of large number of administrative and financial functions demands extra time and effort to manage those functions. It has been seen that company needs to allocate huge amount and money to manage these functions which in turn increases cost burden for companies. The cost burden creates negative impact on the operating and financial profit margin of the company. This extra cost burden put the companies in a vulnerable situation in a long time (Doh 2005). Moreover, it also led the companies to deviate from the core operations and focus on such back-ended and supporting functions. For instance, IBM (International business machines) continued to enjoy dominance in the field of mainframe computing for many years. The company continues to enjoy leadership in the manufacturing of personal computing device. The personal computing manufacturing industry entails huge capital expenditure and initial costs to initiate the manufacturing process. The huge capital expenditure deters the other players from entering in this industry. However, entry barriers in terms of huge capital cost and initial expenditure falls or reduces with the passage of time. The reduction of entry barriers led the other players to enter in the personal computing manufacturing industry (Clark, Zmud and McCray 1995). This scenario paves the path of entry of many other players like Dell, Toshiba, Hewlett-Packard, and many others in the personal computing manufacturing industry. IBM has started to face immense threat and competition from these players. In response to this, IBM has started shifting their business focus towards ‘business transformation services’ ...Download file to see next pagesRead More
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