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Outsource and/or Sub-contract - Essay Example

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This suggests the organization should determine the best method to apply in order to meet its goals and objectives. In other words, apart from…
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Outsource and/or Sub-contract
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Outsource Task: Outsource There is essence of either outsourcing or subcontracting all production in a company in order to generate sales and hence profits. This suggests the organization should determine the best method to apply in order to meet its goals and objectives. In other words, apart from identifying the method that makes sense to a company, it is also imperative to note the benefits and the underlying costs (Ashley, 2008).
Therefore, in that context, the use of outsourcing would outdoor subcontracting in terms of planning for the right capacities. For example, while outsourcing involves the acquisition of goods or services from supplier found outside especially an environment of an internal origin; subcontracting on the other hand entails the employment of a business or an individual outside one’s organization to perform a duty as part of a larger project. This suggests that the best alternative is outsourcing because goods and services are found within the jurisdiction of the business (Linder, 2004). On the other hand, subcontracting does not permit the working of a person inside the organization in order to facilitate planning for right capacities. Additionally, in outsourcing workers can be transferred in other sectors of the organization unlike in subcontracting where the completion of a task is time limited.
On that context, there are various benefits that organizations enjoy while using outsourcing in their production. For example, it helps in the focus of core activities in terms increasing the volume of buying within a short time. Similarly, there is cost and efficiency savings through having small offices that are run with reasonable costs (Power, 2006). Additionally, there is reduced overhead especially when conducting a task involving the function of a back office. Alternatively, this is in tandem with assisting in operational control through the costs of outsourcing in other related departments. Furthermore, there is staffing flexibility that is brought by outsourcing through giving other workers an opportunity in other areas. In the same prospect, it helps in risk management and continuity of turnover of workers in the organization.
In terms of costs, it is a different case when outsourcing and subcontracting are compared. For example, there are social implications especially when sending workers to go and work in a foreign company. There are some employees who would not feel comfortable working in strange places with strange people (Ashley, 2008). Similarly, outsourcing of workers would compel companies have skilled and well trained workers who competent in different capacities. Alternatively, a company may lose quality products and services when it only deals with internal experts in terms of outsourcing instead of subcontracting. Additionally, while there is staff flexibility in terms of sending workers to go in other departments, this process increases the costs of maintaining the workers through better remuneration and compensation.
Therefore, even while organizations attempt to find the best planning methods between outsourcing and subcontracting, it is fundamental to weigh the merits and demerits of both systems (Linder, 2004). This is in terms of the costs involved, the existing merits, demerits and social implications on the workers. In other words, while the system should benefit the management, it should also impact on the worker.
Ashley, E. (2008). Outsourcing For Dummies. New York, NY: John Wiley & Sons.
Linder, J. (2004). Outsourcing for Radical Change: A Bold Approach to Enterprise Transformation. Mason, OH: AMACOM Div American Mgmt Assn.
Power, M. (2006). The Outsourcing Handbook: How to Implement a Successful Outsourcing Process. New York, NY: Kogan Page Publishers. Read More
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