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Advantages And Risks Of Outsourcing

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PRATIVA GNYAWALI DAHAL p15121180 By outsourcing facilities to other countries many companies have been able provide services at much lower costs. What are the most common services to be outsourced (examples) and discuss the advantages and risks of outsourcing?

Oxford dictionary explains outsourcing as an act of letting an outside supplier produce goods or service by contract (Oxford Dictionary). Further Banerjee & Williams (2009) defines outsourcing is to buy services from those who is out of your managerial boundaries for unlimited period of times which results in production by different entity for principal company for fixed transaction fee. By these definition it’s clear that outsourcing is something that today’s …show more content…

International outsourcing is a most common activity in today’s global world because of uneven geographical structures and availability of resources such as raw materials, human resource and financial resource (Hamed, Kara, & Ibbotson. 2014). “International outsourcing is one of the key activities in global manufacturing, where manufacturers or organizations transfer the products and services previously conducted internally, to an external party in another country” (Horgos, Hätönen and Eriksson, Ellram and Billington. Cited in Hamed, Kara, & Ibbotson 2014 pp. 463.). It’s clear that companies outsource their facilities in other countries to reduce cost in order to increase profitability of the …show more content…

& Nordin, F. 2009, "Consequences of outsourcing for organizational capabilities", Benchmarking, vol. 16, no. 3, pp. 316-334.
Andone, I.I. & Pavaloaia, V.W. 2010, "Outsourcing the Business Services", Informatica Economica, vol. 14, no. 1, pp. 163-171.
Banerjee, A. & Williams, S.A. 2009, "International service outsourcing: Using offshore analytics to identify determinants of value-added outsourcing", Strategic Outsourcing: an International Journal, vol. 2, no. 1, pp. 68-79.
Caruth, D.L., Haden, S.S.P. & Caruth, G.D. 2013, "Critical Factors in Human Resource Outsourcing", Journal of Management Research, vol. 13, no. 3, pp. 1-9.
Chiu, C., Lai, C. & Chen, W. 2009, "Advantages of Computer Industry Outsourcing in Taiwan", Journal of Global Business Issues, vol. 3, no. 2, pp. 173-177.
Djavanshir, G.R. 2005, "Surveying the Risks and Benefits of IT Outsourcing", IT Professional Magazine, vol. 7, no. 6, pp. 32.
Hamed MoosaviRad, S., Kara, S. & Ibbotson, S. 2014, "Impact of international outsourcing on the value adding of industries", International Journal of Logistics Management, vol. 25, no. 3, pp. 463.
Lacey, M. 2002, "The advantages and disadvantages of outsourcing", American Water Works Association.Journal, vol. 94, no. 4, pp.

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