Question

Outsourcing is often an option for organizations in order to reduce costs. For your assignment, you will choose whether you are for outsourcing or against outsourcing. In this position paper, you must provide specific examples and reasons for why you have chosen your stance.

Answer 1

Nowadays, Organizations are outsourcing their non core and routine activities to external organisations or third party that help them to focus on their core activities and strategies to help them grow. This brings economies of scale, efficiency and access to latest technology. Since the outsourcing service provider has experts possessing greater skill, they are able to provide quick and effective solution to complex matters.

It helps in removing uncertainity about the cost as there is a fixed outflow of fees as per the contract, which helps the organizations to reduce the volatility of their cash flows. Adding up further, there is benefits that the outsourcer don't have to scale up or down their head count as per the requirement as the service provider has to look upon this requirement.

Outsourcing non critical functions can include payroll processing. It doesnot require the company to setup different department for the compnay hence reducing cost. Other example could be outsourcing the maintenanace of IT and computer services where the these are not critical for the organisations.

Therefore, outsourcing helps the organisation to not get entangled in issues which are not critical for organisations success and helps in to concentrate focus required matters.