Outsourcing is the process of transfer of management or the day to day function of a business function to an outside service provider. The transfer in outsourcing involves the transfer of control. Wherein the buyer who is the owner of the company, looks for a supplier to manage the business fuinction/ The buyer and supplier enters into a contract agreement which defines the type of service that the supplier is to deliver and the buyer s obligation to the supplier upon fulfillment of the service. Th buyer is not to instruct the supplier how production is to go about, but instead communicate to the supplier the results that is expected and the process involve in accomplishing those expectations are left to the suppliers strategy.
A large number of companies have adapted outsourcing and found to be a strategic management option. In a competitive world, businesses should start to focus on their core competencies. While it has been criticized to cause unemployment to some countries and is threat to the economy, outsourcing has positive effects on a large level. Through outsourcing, companies can pass the product to its consumers at reduced costs, as there will be high demand for the product if sold at a price lower than what your competitors are selling. The products are marketed as a high tech product due to the high quality control placed into it.
What you Lose in Outsourcing
While you figure that outsourcing could solve your problems and focus more on your business core competencies, you start to realize that there is more to know about outsourcing than the benefits it could do to your business.
Outsourcing deals with your fundamental principles that of which should apply to... [continues]
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(2008, 04). Global Sourcing. StudyMode.com. Retrieved 04, 2008, from http://www.studymode.com/essays/Global-Sourcing-144928.html
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