Question

In: Operations Management

Summarize the qualitative risks of on‐time project completion considering the current employment and work environment in...

Summarize the qualitative risks of on‐time project completion considering the current employment and work environment in the U.S. Several members of your programming team live and work throughout the U.S., and are subject to the laws of those states. Additionally, some of the programming tasks could be modified and possibly sub‐contracted to India, Bulgaria, China, Argentina, and Indonesia.
Discuss how the project manager should address cost/time trade‐offs associated with international outsourced completion of programming tasks. What criteria should be used to determine if a task should be outsourced internationally, or not? Which tasks for this project might be considered for outsourcing to an international programmer or programming team, and why?

Solutions

Expert Solution

The key reason for global outsourcing is to get a cost advantage by utilizing highly skilled low-cost employees available in offshore delivery centers. The offshore activity is challenged by currency fluctuations, time lags, wage fluctuation, and local regulatory policies.

The project manager can address the challenges faced with international outsourcing to complete the programmed tasks are as follows:

  • The offshoring of critical activity can be done judiciously with a well-tried team of professionals.
  • The activity should be offshore to multiple locations based on performance statistics of the facility.
  • The agreements and contracts should be properly formulated and local regulatory policies should be studied carefully.
  • The concentration in one region and dependency on the region should be reduced.
  • The range of activities at one location should be expanded to include many related activities to reduce the cost.

The decision to outsource internationally an activity can be based on the following parameters:

  • The critical and confidential activity should not be outsourced
  • The outsourcing should be done based on the past performance of the outsourced partner
  • The outsourcing of the peripheral activities which are also generating good cost benefits should be accordingly outsourced.

The tasks to be outsourced to an international programmer or team will be determined by the following parameters:

  • The total amount of savings an outsourcer can provide and how soon you can cut the costs.
  • The need to find specific skills and expertise in an area.
  • The rare skill set is available with a specific international programming team or an international programmer.

To sum it up the project manager should analyze the critical skill set and the deliverables he expects and schedule outsourcing after doing a cost-benefit analysis in terms of reducing the spends and the turn around time.


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