Question

Find an example of a company that was successful in outsourcing and one that was unsuccessful. Do you think outsourcing is good or bad for the US economy? Explain why. Provide your response in a Word document of no more than two pages in length.

Answer 1

Infosys is an example of a company which is successful in outsourcing.

Royal bank of scotland is an example of a company which is unsuccessful in outsourcing.

Outsourcing is getting something done from external source rather than doing it within the organization. Basically non core activities are doing using outsourcing.

Outsourcing is very good strategy if it is done in a proper and effective manner. It has many advantages like

• Focusing attention, promoting growth and flexibility of staffing.
• Quest for excellence
• Cost reduction : the company can choose their labour ms outside their home country inorder to lower the costs regarding the workers.
• It can increase the GDP of our country.

But there are also some risks or limitations regarding the outsourcing and they are :

• Confidentiality : when we are sharing the important information with the third party, there will be no guarantee for that information to be prevented from any leakages.
• Sweat shopping : it is generally the exploitation of labour.
• Resentment in the home country : The companies tries to give their works to labors outside their own country inorder to reduce the labour costs. Thus unemployment develops in their home country.

Thus outsourcing is highly good, but it has also some faults if it is not implemented in a right manner.

Thanks!.