Outsourcing at Any Cost?
Case Analysis
Outsourcing at Any Cost? Do Corporations Ever Have
A Moral Obligation Not to Outsource
Galaxywire.net decided to choose its central location in Green Fork, because the city development officials offered a 300,000 low-interest loan for employee training, promise 50 percent tax abatement for the first 10 years and construct a new 2.3 million dollar secondary building for day care and executive suites. Galaxywire.net can help the city solve high unemployment rate, because they planned to hire 3000 employees. CEO promised they will stay and treat their employees as a family to deal with increasing distrustful of large corporations in local.
Few years later, the outsourcing trend becomes popular in the United States of America, especially, most of Galaxywire’s competitors were already outsourcing. Therefore, top management started to consider moving to India in order to save at least 10 million a year. Galaxywire.net let its employees know immediately of its intention to close the home office. It provided severance packages of a month’s full pay and extended health insurance coverage for five months. But none of the top executives would be laid off and still get paid high compensations. At that time, the unemployment rate is still at 10 percent, so the city tried to find solution to make Galaxywire.net stay and still recoup most of the money it hoped to save by moving. The city does not want to lose its largest employers, so they proposed a deal that would save 7 million dollar in the first year, 8 million dollar the second, 9 million dollar yearly thereafter and extended the 60 percent tax abatement for another decade. Also, the employees agreed to a 15 percent pay cut. However, the company was not interested in the first offer and still would not stay. So the employees agreed to another 5 percent pay cut and other concessions. In addition, the city increased the tax reduction by another 5 percent. The second offer totally helps the
Outsourcing at Any Cost? Do Corporations Ever Have
A Moral Obligation Not to Outsource
Galaxywire.net decided to choose its central location in Green Fork, because the city development officials offered a 300,000 low-interest loan for employee training, promise 50 percent tax abatement for the first 10 years and construct a new 2.3 million dollar secondary building for day care and executive suites. Galaxywire.net can help the city solve high unemployment rate, because they planned to hire 3000 employees. CEO promised they will stay and treat their employees as a family to deal with increasing distrustful of large corporations in local.
Few years later, the outsourcing trend becomes popular in the United States of America, especially, most of Galaxywire’s competitors were already outsourcing. Therefore, top management started to consider moving to India in order to save at least 10 million a year. Galaxywire.net let its employees know immediately of its intention to close the home office. It provided severance packages of a month’s full pay and extended health insurance coverage for five months. But none of the top executives would be laid off and still get paid high compensations. At that time, the unemployment rate is still at 10 percent, so the city tried to find solution to make Galaxywire.net stay and still recoup most of the money it hoped to save by moving. The city does not want to lose its largest employers, so they proposed a deal that would save 7 million dollar in the first year, 8 million dollar the second, 9 million dollar yearly thereafter and extended the 60 percent tax abatement for another decade. Also, the employees agreed to a 15 percent pay cut. However, the company was not interested in the first offer and still would not stay. So the employees agreed to another 5 percent pay cut and other concessions. In addition, the city increased the tax reduction by another 5 percent. The second offer totally helps the