Outsourcing, strategic-sourcing or whatever the new buzzword is in management circles these days the goal is still the same, contract functions that fall outside the company's core competencies. The goal is to reduce costs and streamline production. The company that we have been asked to evaluate is IBM who is currently in the process of outsourcing their human resource functions to Fidelity. We have been tasked to answer the question; what three important benefits will IBM receive from outsourcing their HR functions to Fidelity and how will they benefit IBM? The three benefits that I have chosen to concentrate on are; cost savings, improved services and freeing the company to concentrate on core competencies. It is important that we as managers become familiar with outsourcing and its potential benefits if we what to become effective and efficient managers. The first area that I will explore in this paper is cost savings.
The question being ask by IBM employees is no different than the one ask by thousands of government employees when a function is outsourced. How can this possibly save the company money? We are dedicated employees who care about the success of our company and strive to implement cost saving procedures. The answer to that is not always as simple as one would think but if you take out the human emotion then most would agree that it is in the best interest of the company. The first way that they can save money is the fact that it is a flat negotiated fee. In other words there are no hidden fees such as retirement, workman's compensation, health insurance, vacations and so on. Bottom line is that IBM will pay Fidelity an agreed upon amount no matter what it costs them to perform the service. In other words if they can find ways too streamline and create a more efficient operation then they will realize larger profits. Standards, which are normally performance based, will be written into the contract.
Outsourcing is an essential part of this idea. ... Everyone should be influenced by outsourcing. ... Outsourcing does both to the United States. ... Outsourcing is about efficiency. ... Experiencing hidden costs is a huge outsourcing risk. ...
Next, several financial issues can make outsourcing appealing. ... THE BENEFITS FROM OUTSOURCING Outsourcing has identified numerous potential benefits. ... THE PROCESS OF OUTSOURCING There are many ways to manage IT outsourcing since every company has different culture, strategy, structure, people, and process. ... However, I"m here going to use Xerox's outsourcing process. ... THE PROBEMS IN OUTSOURCING Many outsourcing contracts are structured for very long periods in a world of fast-moving technical and business change. ...
One should emphasis that outsourcing is an issue that is not specific to distribution. ... There are different reasons for organisations outsourcing their distribution function. ... Globalisation is another aspect which has impact upon increasing outsourcing. ... Another risk outsourcing is the impact of outsourcing on those currently responsible for management of the function is fundamental. ... Outsourcing now commonly includes asset transfers. ...
Nowadays, many organisation are outsourcing their non- core activities to an external agents. ... One should emphasis that outsourcing is an issue that is not specific to distribution. ... Globalisation is another aspect which has impact upon increasing outsourcing. ... Another risk outsourcing is the impact of outsourcing on those currently responsible for management of the function is fundamental. ... Outsourcing now commonly includes asset transfers. ...
Mike Johnson (1997) maintains outsourcing isn't a new idea. ... Outsourcing has fostered the concept ofcore? ... Outsourcing is becoming increasingly important in a constantly changing economy. The Australian Outsourcing Summit 2000 focused on this importance, and on the emergence of outsourcing as a powerful tool for transforming organisations and driving innovation (Corbett 2000). ... their organisations, have championed the concept of outsourcing (Klepper 1998). ...
The massive move to outsourcing presents a series of new challenges for organisations, both public and private. ... Several arguments can be made about the reduction of costs for the corporation under outsourcing. ... Another facet of outsourcing is a perceived mitigation of responsibility for IS in the enterprise. ... In the classic outsourcing environment, the executive level of a corporation and an outsourcing company agree to split the corporation's personnel into two groups. ... Executives should be aware that and outsourcing provider will attempt to develop contracts most f...
Discussions are also made on the risks involved in outsourcing. ... The two main types of outsourcing are Information technology (IT) Outsourcing and Business Process Outsourcing (BPO). ... Why outsourcing Outsourcing is an increasing attractive business option because overall, companies tend to outsource to alleviate administrative burdens and focus on strategic areas. ... That's good news about outsourcing. ... Another major risk in outsourcing is Loss of proprietary information. ...
Is global outsourcing an opportunity or threat? ... The airline companies losing money had nothing to do with outsourcing. ... It is funny how people are just now making an issue out of outsourcing, when outsourcing has been going on for the last 40 years. ... Outsourcing effectively promotes trading between global markets. ... Outsourcing enhances the quality of lives for poor countries. ...
So does this mean that outsourcing white-collared jobs will in the long term have the same effect as did outsourcing blue-collar jobs? ... (Outsourcing Jobs: Is it bad? ... I believe outsourcing to be good. ... Sources -Outsourcing Jobs: Is it bad? ... -Outsourcing: The Word on the Hill Business Week. ...
