Competition and Industry Economic Assignment
Added on 2021-06-17
11 Pages1914 Words65 Views
Running head: COMPETITION AND INDUSTRY- ECONOMIC ASSIGNMENTCompetition and Industry- Economic AssignmentName of the Student:Name of the University:Author’s Note:
COMPETITION AND INDUSTRY- ECONOMIC ASSIGNMENT1Table of ContentsAnswer to Question 1......................................................................................................................2Answer to Question 2......................................................................................................................4Part a:...............................................................................................................................................4Part b:...............................................................................................................................................5Part c:...............................................................................................................................................6Part d:...............................................................................................................................................7Answer to Question 3:.....................................................................................................................7Reference List..................................................................................................................................9
COMPETITION AND INDUSTRY- ECONOMIC ASSIGNMENT2Answer to Question 1Through practicing the offshoring activities an organization can transfer some itsbusiness activities overseas. This can either be in the form of an operational process such asmanufacturing or a supporting process for instance accounting or both. The offshoring activitiescan be divided into two types which are namely the production operation related offshoring orservice related offshoring (Bandick, 2016). In relation to this a few processes that helps inevaluating the business can be taken into account. Those factors ranges from business size,cultural environment, infrastructural framework. Availability of skilled workers an standard ofthe industry. Evaluating these factors and observing them closely will in turn help to determinewhy the Asian countries are evolving as the most efficient offshoring partner in comparison tothe countries of South America or Africa (Kvedaraviciene and Boguslauskas, 2015).Since the past few years the infrastructural framework of China and India have depictedsignificant growth and development. These two countries taken together have acquired the lion’sshare of the total market share of the world which as a result contributed effectively in theeconomic development of these two countries (Clampit et al., 2015). The governments of boththe countries have invested enormously in developing the communication and transportationsystems. Moreover, the businesses within the countries have also marked significant growthduring this period. There are mainly five key determinants which should be considered by anorganization while selecting the offshoring countries. These five key factors can be stated asfollows,Infrastructure
COMPETITION AND INDUSTRY- ECONOMIC ASSIGNMENT3It is needless to mention that the geographical location should be considered first whileselecting the country of outsourcing, however, the most critical factor in this case is theinfrastructure of the service provider which can be considered as the main determining factor ofoffshoring choice. Now in relation to India it can certainly be stated that the country hasprojected significant growth in terms of infrastructural facilities since the past few years(Rodríguez and Nieto, 2016). Various countries have already selected India as their offshoringpartner. However, it has been projected that by the end of 2040 the Indian economy will beneeding $4.5 trillion of investment for developing its infrastructure furthermore. As a result thecountry is thrusting on development and betterment of its existing infrastructure so that theforeign investors become willing to invest in the country (Gylling et al., 2015). The Chineseinfrastructure on the other hand, has also projected significant development. Specifically thetransport infrastructure of China is being developed at a rapid pace.Business SizeThe businesses which is offshoring should certainly consider whether the serviceprovider have experience of working with organizations of their size or not. In India and Chinathere are numerous service providers and hence this factor is in favor of any foreign businesswilling to offshore in these countries (Musteen, 2016).Cultural AlignmentThe theorists suggest that businesses should focus on offshoring to only those locationswith which they will found certain similarities in culture. Language barriers and cultural gap mayaffect the productivity. In this context it can be stated that India and China are two huge
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