Benefits and Limitations of Outsourcing Models

This presentation discusses the benefits and limitations of different outsourcing models. It explores the legal and environmental issues that organizations may face when outsourcing. The presentation also highlights the requirements that affect the choice of country for outsourcing and provides recommendations for successful outsourcing. Course code: N/A, Course name: N/A, College/University: N/A

Professional Issues
and Practice

Content
 Introduction
 Overview of the company
 Benefits and limitations of different outsouring model
 Legal and environmental issues to the organisation
 Requirements that affect choice of country
 Recommendation
 Conclusion

INTRODUCTION
 Outsourcing is the activity which includes hiring of
someone other for the performance an organisational
functions in expertise manner.
 These third parties are responsible for the completion of
work in accordance to the standards and requirements of
an organisation.

Overview
SCP Ltd. has business operations in both type of functions,
manufacturing and retailing. The main purpose of the
organisation is to build long lasting image in society through
manufacturing and retailing modern design products. In
actual, this organisation was founded in 1985.

Different Outsourcing Models
Joint venture offshoring as global shared services: This
is the method that includes ties up with the local
organisation exists in other country.
Multi sourcing model: This is the model where
organisation enters into the parallel agreement with
different number of suppliers and vendors present in
another nation.

Benefits And Limitations Of Joint
Venture Offshoring As Global Shared
Services
Benefits: This will creates the benefit in form of using the strength of
other organisation having expertise in performance of functions like
IT, Human resource and administration.
Limitations: No control over the operations of other organisation.
This will sometimes result into occurrence of fraud that have direct
negative impact over the image of an organisation along with
monetary loss.

Benefits And Limitations Of Multi
Sourcing Model
Benefits
 Separate contract provides more expertise along with
removes the dependency over one supplier.
Limitations
 Requires investment of higher cost in contracting three
different experts.

Legal and environmental issues in UK
 Fine due to non consideration of new laws occurred
after exist of UK from EU.
 Cancellation of agreement due non fulfilment of
standards and requirements in accordance to the
existing or new specified laws.

Legal And Environment Issues In China
 Fine, if not able to fulfil all legal requirements
 Cancellation due to non fulfilment of China standards
and signed agreement terms
 Fine, if having contribution towards carbon emission
above to the permissible limit

Legal And Environment Issues In India
 Fine in case of non fulfilment of laws and standards
 Cancellation due to non fulfilment of mentioned
terms and conditions in agreement
 Cancellation of an agreement or fine due to having
negative impact on environment in case of excessive
carbon emission

Requirements
(IT Systems)
 Existence of technological environment
 Freedom of working on the basis policies, laws and
legislation (Specific to project nature)
 Presence of high knowledgeable personnels
 Persistence of IT organisations

Human Resource Systems
 Presence of expert level organisations
 Past record towards developing good workforce of any
organisation
 Existing of policies, laws and legislations related to
outsourcing (Specific to project nature)
 Investment cost along with availability of talented personnels

Administrative System
 Persistence of laws and legislations (Specific to project
nature)
 Total cost of investment
 Dependency
 Persistence of knowledgeable personnels
 Positive working culture environment

Recommendations
The preferred single country for the purpose of carrying all
the three project will be China. The reason is existence of
high technological environment, diversified business
activities related to human resource and administration
and cost efficient in nature due to presence of high
amount of employees.

CONCLUSION
It has been concluded from the above report that offshore
outsourcing is better as lots of advantages will be attained
in for expertise, reduced cost, high profitability etc. China
will be the perfect nation to outsource as highly
developed in IT.

REFERENCES
Bass, J.M. and et. al., 2018, May. Employee retention and turnover in global software
development: comparing in-house offshoring and offshore outsourcing. In 2018
IEEE/ACM 13th International Conference on Global Software Engineering
(ICGSE) (pp. 77-86). IEEE.
Gerogiannis, I., Zimmermann, A. and Wilson, A., 2017, February. Services
offshoring: a microfoundations perspective. In International Workshop on
Global Sourcing of Information Technology and Business Processes (pp. 1-18).
Springer, Cham.

Thank You