Karen E. Wilkerson
Advantages and Disadvantages of Outsourcing
Module 3 Case
Dr. Carmen Castro
Outsourcing means borrowing skilled workers from a vendor company. They can be hired temporarily or on a per contract scheme. It has been said that, when done for the right reasons, outsourcing will actually help your company grow and save money. There are advantages of outsourcing that go beyond money. There are also disadvantages of outsourcing that is bad for your company. It is called off-shoring when companies go to outside of the region to hire employees. Is it really a good idea to hire people outside of our country when there are people here that need jobs? Will it save the American Economy? The controversy still continues.
There are a lot of advantages that can go with the decisions to outsource. You can acquire a cost savings when you are allowed to focus on your expertise and core business. This will eliminate having to consider employee compensations costs, office space expenses, utilities, supplies and other cost associated with that responsibility. It will also allow you to focus on core business because you are outsourcing to a firm that specializes in that area of expertise. It also helps you to improve on quality if you are allowing someone familiar with that area of expertise. You can improve on customer service because it will be the vendor’s responsibility to replace a technician if they call in sick. It will allow operations that have seasonal or cyclical demands to bring in additional help when you need them and release them when you are done. You can reduce overhead cost by reducing the need for more office space if you outsource some of the simple operations like outbound telemarketing or data entry.
There are also disadvantages that go with the decisions to outsource. You can experience a loss of managerial control because the outsourcing company that you choose will not have the same drive that you have.... [continues]
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