The main advantage of outsourcing work to less developed
countries is that companies can remain competitive in the global market and
access foreign markets more easily. Businesses can settle with lower labor costs
by hiring workers from less developed countries and developing country markets
with lower living standards. It also allows companies to deliver goods produced
from manufacturing countries back to the US. At a relatively low price.
Conversely, outsourcing work increases the US unemployment
rate, such as now, there is 14+ million outsourcing work from the US that can
be filled with unemployed citizens. If this work is returned to the US, 4.3 a million workers who are currently working part-time can get full-time work.
It should be noted that many foreign specialists are
recruited to help with local marketing, translation services, and business
development. The position of this work can also be filled with US workers, but
businesses see profits in hiring local specialists who know the original
language and specific markets and can be paid lower. If the same work is taken
by US citizens, it will definitely lead to a higher price than the company's
products and services.
4 ways industrial damage outsourcing
Every year, the number of outsourcing work reaches 500,000.
Although at present, the capital is held by national and multinational organizations,
can damage the US industry in the long run. Lack of job openings, and lack of
talent in the US, can vote for other technologies in America and suppress the
US economy. This is the fourth main threat from outsourcing to the US industry.
Unwanted consequences of outsourcing
Outsourcing and Offshoring are natural results of
globalization of markets around the world and intends companies to reduce
operational costs and maximize income. If people in China or India can do the
same work at a much lower price than US citizens, businesses will outsource
such work without hesitation.
This business strategy has proven useful and the company
wants to allocate labor to the most efficient use. In short, without
outsourcing, the US will not be able to maintain the status of its global
economic market in the world today because it is an integrated global market.
Do outsourcing good or bad for America?
Even though there are some pros and cons to outsourcing, many
experts argue that the trap is not too drastic. In many cases, companies must
cut costs somehow to stay on the market, especially when in the recession
period, and with outsourcing manufacturing and business operations, such
business can struggle and succeed in the long run.
It's all about comparative advantage. At present, the US
cannot boast the benefits of comparative making due to high wages and strong
currencies. Outsourcing allows solutions to the most cost-effective solution.
Outsourcing abroad and its influence on the US economy
Outsourcing is often blamed and manipulated politically to
overcome work shortages in M.S., but no one shows the amount of work made as a
result of outsourcing services by US business. American companies that
outsource some of their manufacturing and business processes have benefited
from the United States foreign countries and economics.
As a result, the economy of less advanced countries is
driven by the demand for manufacturing products by American consumers. As a result,
the US moves in the process of international trade and receives the necessary
items at lower costs. This produces a higher ROI and the product at a better
price for US citizens.
Outsourcing items and their components are then included in
larger products in the US and related to the creation of work positions for
high-skilled US citizens. However, this benefit is often ignored when
outsourcing is discussed. No doubt, outsourcing is developing the US and foreign
economy as a product produced abroad and then sent to US customers at a more
affordable cost.
Manage outsourcing risk.
Now we know all side outsourcing is good and bad, let's talk
about how to manage outsourcing risk.
Defining requirements
Before choosing the outsourcing, the vendor defines several
things: the problem you want the outsourcing provider to solve; The purpose of
collaboration; Concerns and risks related to the potential of outsourcing
partners. Identifying these aspects will help you set the right requirements
for your prospective candidates who will serve you as a guide when monitoring
the performance of vendors.
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