Essay about The Pros and Cons of Outsourcing - 3739 Words

Introduction This paper is a general overview of outsourcing. It explores when to outsource and what advantages and disadvantages a public manager may face when deciding whether to outsource. I have chosen references to support this text that are both academic and colloquial. Indeed it was a discovery to learn that Outsourcing had become a well-developed academic area of study. My prior study of the subject revolved around personal conversations and non-academic magazine articles. It may be interesting to note that an internet search using key words, privatization + government in both Yahoo and Dogpile failed to bring up a specific government agency devoted to outsourcing or privatization. In the private sector there were†¦show more content†¦Examples: everything from construction of aircraft carriers and management of nuclear weapons facilities to provision of landscaping services. Thus outsourcing/privatization may be considered broad encompassing terms while, contracting out may be a variant and subcategory in the sense that the goods and services may still be owned by the parent organization. For example, The Navy may have contracted out XYZ Iron Works to build an aircraft carrier, but the Navy still owns it. The Post Office on the other hand is a quasi-independent organization, formerly run by the government but is now privatized. At other times the privatization/contracting out distinction is more apparent. The researchers found that successful state and local government reform plans seek to eliminate or privatize functions that are not essential. Where privatization is not practical, they introduce competition by contracting out the service.3 In other words, a task is either wholly turned over to a private organization to run or is given partly to a private agency to run for a set period of time. I will explore both of these issues, i.e. contracting out and privatization/outsourcing as many of the features of both overlap in terms of the decision making of public managers. Pros and Cons Depend on Organizational Focus Perhaps the most commonly asked question in reference to outsourcing, particularly from a management perspective, is, What are the pros andShow MoreRelatedPros and Cons for Outsourcing1710 Words   |  7 PagesThe Pros and Cons of Outsourcing services in the US By Berend Schoute (1713035), student of the VU university Amsterdam. INTRODUCTION Hillary Clinton, I dont know what reality the Bush administration is living in, but its certainly not the reality I represent, from one end of New York to the other. This response came on the statement of the head of U.S. President George W. Bushs Council of Economic Advisers, Gregory Mankiw. He said: outsourcing is just a new way of doing international Read MorePros and Cons of Outsourcing1004 Words   |  5 PagesInternational Business 14 Feb 2013 Outsourcing Outsourcing is the contracting out of an internal business process to a third party organization. The term outsourcing became popular in the United States near the turn of the 21st century.(6) Outsourcing is big business today even for small businesses. Like every business decision we are faced with the advantages as well as the disadvantages of relocating part or all of a business. Outsourcing is one of the fastest growing trends in businessRead More Outsourcing IT Jobs: Pros And Cons Essay952 Words   |  4 PagesOutsourcing IT Jobs: Pros and Cons In 1973, a monumental shift was prevailing where U.S. companies were sending low skilled jobs within the manufacturing industry to offshore countries to reduce labor cost while maximizing profits. 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The three videos analyzed in the paper have successfully definedRead MoreMabuhay Pumps Company1205 Words   |  5 Pagestheir own a foundry to cast pump housings and assortment fittings to prove their mastery in their line of business, it would be difficult for Renzo to point out that outsourcing their foundry production, would help the company in more ways than they expect, even though it is a huge change from the norm. Renzo believes that outsourcing will lessen expenses, generate more income and save enough money for future use or plans. The company’s president strongly believes that MCP does not need to outsourceRead MoreBenefits Of Outsourcing Supply Chain Management942 Words   |  4 PagesOutsourcing in different countries of the world has grown and is continuing to grow very rapidly, at a recorded rate of 20%-25% a year (Top 10 Risks of Offshore Outsourcing). Because of the many advantages that businesses can gain from outsourcing, there is no certainty that there will be a reduction of outsourcing anytime soon. The main advantage of making this business decision is that the businesses will have more time to focus on the principal aspects of their business, while the third partyRead MoreOutsourcing : Outsourcing And Outsourcing1579 Words   |  7 Pagesâ€Å"Outsourcing refers to obtaining certain services or products from a third party company, essentially sourcing something like accounting services or manufacturing of a certain input to another company. While many think outsourcing refers to using a service provider in another (usually cheaper) country that is not necessari ly the case. Outsourcing can be done to a company that is located anywhere, the location isn’t important.† (Offshoring vs. Outsourcing, n.d.). There are many reason a businessRead MoreThe Advantages and Disadvantages of Outsourcing1442 Words   |  6 PagesWhat are the advantages and disadvantages to outsourcing in the global marketplace? In these times of great globalization where many countries have erased their borders when it comes to trade outsourcing has become an option for many companies. Whether or not to outsource is a key question that companies must consider. According to the Pros and Cons of Outsourcing, â€Å"The decision to outsource or not is a matter of finding the right balance-the balance between managing labor costs, workflow, employee