International Business 401 Module 3 Case Assignment

In recent times, Outsourcing is becoming very much accepted. It pertains to the “acquirement of a product or service rather than producing it”. It can also be interpreted as a transfer or delegation of day-to-day business process to an external service supplier. At present, outsourcing is generally used by every organization in one way or the other. Most of the IT companies which are functioning in quite a few nations are doing their work with the help of outsourcing this can be understood with an example of Dell Computers (Rein gold, 2004).
Dell Computers which is a multinational firm has most of its troubleshooting call centres in India at present. This new concept of outsourcing is producing a lot of dislocations which are good for some people and on the other hand, abominable for some people. Most of the multinationals firms are going for outsourcing as in the year 2003, IBM decided to shift the jobs of almost 5,000 programmers to India and China (Kriplani & Einhorn, 2003). GE has also stimulated much of its research and development operations abroad. Microsoft, Dell, American Express and almost every major multinational firm is outsourcing their work.
Advantages & Disadvantages of Outsourcing
Advantages:
Outsourcing furnishes a number of benefits to companies which are as follows:
• It concentrates on the core business areas of a firm.
• By using outsourcing, a multinational firm can bring down its operating costs.
• With the assistance of outsourcing a firm can gain access to a larger pool of workers at reasonable prices.
• Outsourcing furnishes an access to ameliorated expertise at a lower cost.
• It step-ups the productivity & profitability of a firm.
Disadvantages:
With significant advantages outsourcing also has some disadvantages which are as follows:
• It may be harder for firm to direct the outsourcing service provider in equivalence to managing its employees.
• If the outsourcing service provider goes bankrupt or out of business, the