HI5013: Managing Across Borders Report on Outsourcing

This report provides a comprehensive analysis of outsourcing in the context of managing across borders. It begins with an executive summary and table of contents, followed by an introduction that defines outsourcing and its significance. The report then delves into the advantages of outsourcing, such as cost reduction, time utilization, and improved operational competence, while also addressing the disadvantages, including the risk of quality issues, the need for constant management, and potential employee frustration. Real-world examples of companies like WhatsApp and Google are used to illustrate the practical application of outsourcing strategies. The report concludes by summarizing the key findings and emphasizing the importance of carefully considering both the benefits and challenges of outsourcing in order to make informed business decisions.

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Managing Across Border
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Executive Summary
Outsourcing is one of the tools that are recently used by the leading companies. It is the process
through which some internal activities and decisions given to outside provider to work in an
efficient manner. The leading companies such as Whatsapp, Google are using such platform to
compete its competitor. It helps in controlling the overall cost of the company with enhancing its
performance in the competitive market in an effective and efficient manner. However, it can also
negatively affect the company as it creates the issue of lack of coordination and also enhance the
level of frustration among the employee due to lack of communication among them. Therefore,
the report will cover the advantages and disadvantage of outsourcing that will be supported with
some examples.

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Table of Contents
Executive Summary.........................................................................................................................1
Introduction......................................................................................................................................3
Defining Outsourcing......................................................................................................................3
Advantages of Outsourcing.............................................................................................................3
Disadvantage of Outsourcing..........................................................................................................4
Some Examples of Outsourcing......................................................................................................5
Conclusion.......................................................................................................................................5
References........................................................................................................................................7

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Introduction
In the recent scenario most of the corporations incline to let the third party corporations to
manage the operational activities of their service. Such ingenuity action is deliberated to be
precarious act sue to the reason it is primarily made for deducting the overall cost of the
company and the specification such corporations has to deal. The outsourcing is applied in the
international market. the leading companies outsource their work in the cheap labor market that
help them to control over the overall cost of the company as well as also help them to provide its
product at competitive price in the market in an effective manner (Vaxevanou and
Konstantopoulos, 2015).
In the following part there will be detailed analysis of importance of the outsourcing as well as
the challenges that are faced by the companies in adopting the method of outsourcing.
Defining Outsourcing
Outsourcing is defined as the act of moving some of the internal activities of the organization as
well as decision responsibilities to outside providers. Moreover, it is defined as the procurement
of the product as well as services of the organization from the external sources. Therefore,
outsourcing is referring to allocating or relocating the activities related to the business from the
source of internal to the external sources (Chanson, 2018). The outsourcing in the international
context refers to the activities between the two boundaries or the nations of two or more
countries. It involves global outsourcing that includes emeritus international external companies.
Although outsourcing is the new concept, it has been practiced before as well as also referred as
subcontracting the activities related to production (Bębenek, 2016).
Advantages of Outsourcing
Outsourcing has created great impact over the performance of the organization in the global
market. it play a vital role in the growth and performance of the company that made them
competitive in the market. There are certain advantages of the outsourcing as they are explained
in the below points:

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 Reducing Cost: with the help of the outsourcing of the work, the company can able to
control over its overall cost to the certain extent. It is one of the main aspects that
companies select to use the outsourcing. Such cost are mainly refer to the fees of the
employees, space for office overheads and certain further cost such as subcontracted staff
as it provided to be the way inexpensive than the staff impending from the developing
republics.
 Time Utilizations: the other benefit that occur form the outsourcing is utilization of time
in more efficient manner. It offer high speeding time that outsourced the work. The best
illustration of time consumption in an organization would be procedure related to
engagement of employees for the formation of the novel crew. Therefore, consuming
subcontracting such time can be abridged to a utmost level (Somjai, 2017).
 Operative Competence: due to the circumstance that the staff is controlled by the
subcontracting, the people inside an organization can have the prospect distillate more on
their early charged as well as execute improved in their subdivisions. It is one of the
essential reasons for the organization to usage the subcontracting as it permits the staff to
emphasis on their proficient but majorly on the main professional (Vaxevanou and
Konstantopoulos, 2015).
Disadvantage of Outsourcing
There are certain challenges as well that the company is facing while outsourcing it work to the
external companies. Such challenges are explained in the below points:
 Risk of Quality: sometime there are drawbacks as well as while using outsourcing that
can affect the name as well as the reputation of the organization adversely. Sometimes
when the consumer has a purchase as well as future on ascertains that the part of the
produce that he compensated for is damaged, then the corporation will be liable to
standby such part by communicating its subcontract dealer however, the organization
continuously need to transmit the encumbrance of the dented produce (Mosca and
Bordelon, 2017).
 Constant Management: It is widely known that in the recent scenario most of the
companies fail to subcontract their ventures due to the reason they do not have

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appropriate management system. Most of the companies require possessing a high
acumen executive that will entirely pact with the administration of the subcontracted
ventures.
 Condition of Frustration: Such conditions are usually refereeing to the knowledge of
skills of the employees. when the outsource companies dealing with the big companies
they majorly face language barriers that resist them, to connected with the big companies
to the certain extent. For instance, when the buyer call center is subcontracted to a
dissimilar linguistic business there may be some infuriated consumer that will contract
with the unmanaged complaint of communication. Furthermore, the company can face
frustration while it face the issue of dearth of association knowledge where the
subcontracted staffs are not enclosed by the similar desire or the obligations for the
company that make them generally fool as well as knowledgeable in the front of
consumers (Somjai, 2017).
Some Examples of Outsourcing
There are certain live examples of outsourcing as they are explained in the below points:
 Whatsapp is one of the known companies. In the year 2012, the company was consider as
the small firm that manage its business with 30 full time employee and 5 part time
employees. Since then the company has grown to be one of the most famous chat apps in
the international market it was purchased by the company. However, the company did not
experience such growth by relying solely on their 35 teams members, to control over the
operational cost; the company outsourced the development to developers in Russia as
well as for a fraction of the cost wit would have been taken to keep the business at home
(Dinu, 2015).
 Google is one of the organizations that set an example of excellent business practices as
well as scaling successfully. The company work hard to take the care of all their in-souse
employees. However, such in-house employees are not the only individual that enjoys the
benefits of the Google employments. The company has also been outsourcing the work to
remote the employee for the years. The company outsources virtual assistant work,
development; IT related work and so on (Kenyon, Meixell, and Westfall, 2016).

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Conclusion
From the above analysis it can be concluded that outsourcing is one of the effective manner to
enter in the international market. In the recent, most of the leading companies has adopted the
process of outsourcing to control over the cost in an effective manner. The company can also
able to speed up their process with the help of outsourcing. Therefore, outsourcing is one of the
effective tool in which the companies give its work to the external company to compete in the
market in an effective manner. However, some of the companies also face challenges such as
compromise with the quality, lack of coordination that affected the image as well as performance
of the companies adversely. Therefore, it is required for the company to analyze the market first
accordingly steps need to be taken by them to compete the competitors.

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References
Bębenek, P. (2016) Project and Innovation Management in Agriculture-Outsourcing and
Protection of the Environment in Polish Farms. International Multidisciplinary Scientific
GeoConference: SGEM: Surveying Geology & mining Ecology Management, 3, pp.461-468.
Chanson, G. (2018) Macro-environment’s effects on onshore outsourcing: the transition costs
approach. Journal of Global Operations and Strategic Sourcing, 11(1), pp.27-38.
Dinu, A.M. (2015) The risks and benefits of outsourcing. Knowledge Horizons. Economics, 7(2),
p.103.
Kenyon, G.N., Meixell, M.J. and Westfall, P.H. (2016) Production outsourcing and operational
performance: An empirical study using secondary data. International Journal of Production
Economics, 171, pp.336-349.
Mosca, J.B. and Bordelon, G.R. (2017) Human Resource Managers Detect Management & Legal
Disadvantages to Outsourcing. Business, Management and Economics Research, 3(2), pp.8-17.
Somjai, S. (2017) Advantages and disadvantages of outsourcing. Graduate School, Suan
Sunandha Rajabhat University. Bangkok, Thailand. Business and Management Review, 9(1).
Somjai, S. (2017) Advantages and disadvantages of outsourcing. Graduate School, Suan
Sunandha Rajabhat University. Bangkok, Thailand. Business and Management Review, 9(1).
Vaxevanou, A. and Konstantopoulos, N. (2015) Basic principles the philosophy of
outsourcing. Procedia-Social and Behavioral Sciences, 175, pp.567-571.
Vaxevanou, A. and Konstantopoulos, N. (2015) Basic principles the philosophy of
outsourcing. Procedia-Social and Behavioral Sciences, 175, pp.567-571.