Outsourcing and its Impact on Businesses

This assignment examines the increasing significance of outsourcing in today's business environment. It delves into the reasons behind this trend, analyzes its effects on business performance, both positive and negative, and provides actionable recommendations based on research findings. The report incorporates a literature review, discusses data collection methods, acknowledges limitations, and cites relevant sources.

RUNNING HEAD: Advantages and disadvantages of outsourcing business functions
Business Research
Advantages and disadvantages of outsourcing business functions

Advantages and disadvantages of outsourcing business functions 1
Table of Contents
Introduction................................................................................................................................2
Project objective.........................................................................................................................3
Project scope..............................................................................................................................4
Literature review........................................................................................................................5
Research questions and hypotheses...........................................................................................7
Research questions.................................................................................................................7
Hypotheses.............................................................................................................................7
Research Design and Methodology...........................................................................................8
Research Limitation.................................................................................................................11
Time Schedule..........................................................................................................................12
Conclusion................................................................................................................................15
References................................................................................................................................16

Advantages and disadvantages of outsourcing business functions 2
Title: Advantages and disadvantages of outsourcing business functions
Introduction
This research report has been conducted on the topic “Advantages and disadvantages of
outsourcing business functions”. This research program will discuss the concept of
outsourcing which is being used by businesses for enhancing their effectiveness and reducing
the workload. Outsourcing is used by the businesses for enhancing their performance as well
as focusing on the important activities or operations of the business. It will also discuss the
advantages and disadvantages of outsourcing to the business. Different methods and
techniques will be applied to the collection of data. These methods and techniques will be
discussed in this research report.

Advantages and disadvantages of outsourcing business functions 3
Project objective
Objectives are set for identification of the goals which need to be adopted from the execution
of the activity or series of activities. This research report has been conducted with a motive to
collect data related to the various advantages and disadvantages associated with the use of
outsourcing to the business. Knowledge will be developed of the concept of outsourcing and
its importance for the business. Various articles, journals and internet sources will be used for
developing knowledge regarding the research topic.

Advantages and disadvantages of outsourcing business functions 4
Project scope
The scope defines the boundaries of the research and aspects which will be covered in this
research report. Outsourcing is widely used by the businesses for enhancing the performance
of the business. This research report will discuss the advantages and disadvantages of
outsourcing. Various research methods or techniques will be put to use for gathering
information related to the research topic. An action plan will be prepared for conducting the
research project as per the plans.

Advantages and disadvantages of outsourcing business functions 5
Literature review
Outsourcing is an important aspect of the dynamic business environment as there has been a
rise in the use of this concept. Businesses are enrolling in outsourcing for ensuring that the
operations of the business are performed in an effective manner. Outsourcing has contributed
towards the attainment of the objectives of the business. The main objective behind the use of
outsourcing is to manage the time by focusing on the crucial aspects of the business.
Globalisation has promoted the concept of outsourcing. Previously outsourcing was used for
cost cutting but with the change in the business environment, outsourcing has been used for
enhancing the performance and focusing on the important activities of the business. For
operating in an effective manner in the dynamic business environment, it is vital to adopt
effective strategies. Different authors have presented different views for outsourcing which
have been discussed in this research project (Sturgeon & Gereffi, 2011).
The term outsourcing can be defined as the use of outside resources for the purpose of
execution of the operations of the business by handling the operations to outside company or
third agency. Businesses are using outsourcing for the purpose of enhancing the performance
of the business, reducing the cost, time and efforts, enhancing the effectiveness of important
functions of the business and increase the productivity of the business (Tayauova, 2012).
There are few disadvantages associated with the use of outsourcing. These disadvantages of
using outsourcing include an increase in the cost, lack of proper infrastructure facilities, lack
of support on the part of the government, depletion in the quality of the products or services
outsourced, the threat of leakage of the confidential information of the business and lack of
control on the operations. Focus on the business while taking outsourcing decision is on
quality of the services, confidentiality, and control on the operations outsourced. Companies

Advantages and disadvantages of outsourcing business functions 6
are considering outsourcing for reducing the legal and financial obligations which are
contributing to the cost of the business (Mirza, 2012).
Different factors are responsible for determining the decision of outsourcing. Businesses are
analyzing different aspects related to outsourcing for drawing a decision. Different functions
or operations of the business are being outsourced by the businesses for enhancing the
effectiveness and focusing on the important functions of the business. There has been a fast
increase in the use of outsourcing. The concept of outsourcing includes appointing the third
party for the purpose of performing or executing the operation of the business. Companies are
using outsourcing for encouraging the chances of success and growth as well as gaining a
competitive advantage over the others in the industry. Private and public organizations both
are using outsourcing for enhancing their performance (Galetic, et. al., 2011).

Advantages and disadvantages of outsourcing business functions 7
Research questions and hypotheses
Research questions
Research questions are formulated for forming a base for the data collection process.
Research questions are mentioned below:
 What is the role of outsourcing for business in the dynamic business environment?
 What is the trend of outsourcing in enhancing the performance of the business?
 What are the advantages and disadvantages of outsourcing for the business?
Hypotheses
 Outsourcing has changed the manner in which business is conducting their operations.
 Outsourcing decreases the control of business on its operations.

Advantages and disadvantages of outsourcing business functions 8
Research Design and Methodology
Research methodologies cover different methods or techniques which are applied for the
collection of data related to the research topic. This research project has discussed the
advantages and disadvantages of outsourcing to the business. Information has been collected
for gaining knowledge of the aspects related to the research topic. These methods or
techniques are mentioned below:
Research method: It is vital to execute the research program in an effective manner and for
this purpose there is a need to gather quality data which will enhance the quality of the
research program. Qualitative research method will be used for collecting data for the
research project. Qualitative research method will help in collecting quality data by collecting
primary and secondary data (Crossman, 2017). Use of primary and secondary sources of data
will contribute towards the attainment of the objectives of the research project. Research
questions will be used for collecting primary as well as secondary sources of data. Qualitative
research method will help in collecting information related to the behavior patterns, data
related to needs of the users and human experience (Quick & Hall, 2015).
Research approaches: Qualitative research approach will be applied for the collection of
quality data related to the research program. A qualitative approach is an effective approach
which will help in collecting quality data. The qualitative approach provides quality data
which helps in enhancing the knowledge related to the reasons, opinions and different aspects
related to the research topic (Crossman, 2017). Primary and secondary sources of data
collection sum up qualitative approach which forms a base for the reliability and authenticity
of the research project. The questionnaire will be prepared and distributed among the
employees for collecting information. Different journals, articles and internet sources will be
used for collecting secondary source of information (Thomas, 2015).

Advantages and disadvantages of outsourcing business functions 9
Data collection: Data collection is an important aspect which ensures that the research is
being executed in a proper manner. Quality data can be collected with the application of
primary and secondary sources of data collection. This data will help in the completion of the
research project in a successful manner. Primary data can be understood as the raw data
which a researcher directly collects from the respondents for gaining understanding (Smith,
2015). Primary sources are used for collecting first-hand information. The questionnaire will
be used for collecting raw form of data directly from the respondents. Secondary data can be
explained as the second-hand information which other researchers have collected for
performing their researches (Johnston, 2014). This form of data ensures that reliable data is
presented for enhancing the quality of the research project. For the collection of secondary
data, journal articles and internet sources will be used. Data will be collected which is of after
2010. This is done for ensuring that the updated or current data is presented in the research
(Turkenburg & McAuley, 2013).
Procedure and technique: time has acted as a limitation in this research. Due to lack of
availability of time, random sampling technique will be applied in this research program.
Random sampling will help in the analysis and interpretation of the data in a better manner
within the limited timeframe. Random sampling technique is a sampling technique which
provides equal chances of being selected to every sample of the population (Nishad &
Sankar, 2016).
Strategy: a strategy needs to be adopted for the purpose of conducting the research in an
effective manner. This strategy ensures that the research is conducted properly and covering
every aspect. For the execution of this research program, systematic approach will be used.
This systematic approach will ensure that the research is covering every aspect of the
research by ensuring that nothing important has been left out. Different activities of the

Advantages and disadvantages of outsourcing business functions 10
research will be conducted in a sequence and an action plan has been prepared for conducting
the research in a sequence (Nirmala, 2013).
Targeted market: target market is set for identification of the source from where
information related to the research project is to be collected. Primary and secondary sources
of data collected have been selected for collecting information. Primary data will be collected
from the employees working in international organizations. This information will help in
forming a view related to the research. Secondary data will be collected from the internet
sources, newspapers, books and articles.
Choice: Different alternatives have been analyzed for the purpose of selection of the most
suitable or appropriate alternative for conducting this research project.
Ethical consideration: ethical aspects help in the identification of right and wrong. This
research project has been conducted by following the values and principles for conducting the
research within the ethical boundaries. Confidentiality will be maintained for protecting the
confidential information of the respondents. Presentation of data will be done in fair manner
for ensuring that fair views of the respondents have been presented.

Advantages and disadvantages of outsourcing business functions 11
Research Limitation
Few limitations have been identified which have acted as issues for this research project.
Dealing with these limitations in an effective manner is required for the execution of the
research program properly. Time available for the execution of this research was limited. For
coping with this limitation, random sampling technique has been used. Lack of resources is
another limitation which affects the execution process of this research program. For the
completion of the research program in a successful manner, different resources need to be
applied or used. Lack of access to data also affected the data collection process of this
research program.

Advantages and disadvantages of outsourcing business functions 12
Time Schedule
Serial
no.
Activities Initiation
date
Duration
(days)
Completion
date
Description
A) Deciding the
topic for the
research
05
September
2017
1 05
September
2017
Decision will be
made regarding
the selection of
the research topic.
B) Preparation of
plans for research
06
September
2017
6 11
September
2017
Plans will be
formulated for
preparing
guidelines for the
execution of the
research program.
C) Implementation
of the plans
12
September
2017
8 19
September
2017
Implementation
of the plan will be
done as per the
plans formulated.
D) Collection of
data
20
September
2017
11 30
September
2017
This phase of the
research project
include collection
of data with the
application of
primary and
secondary sources

Advantages and disadvantages of outsourcing business functions 13
of data collection.
E) Analysis of the
collected data
01 October
2017
5 05 October
2017
The analysis will
be done on the
collected data for
forming the basis
for conclusion
and
recommendations.
F) Interpretation of
the collected data
06 October
2017
4 09 October
2017
Analysed data
will be used for
interpretation of
the results.
G) Conclusion and
recommendations
10 October
2017
3 12 October
2017
The conclusion
will be based on
the analyzed and
interpreted data
and
recommendations
will be provided.
Gantt chart

Advantages and disadvantages of outsourcing business functions 14

Advantages and disadvantages of outsourcing business functions 15
Conclusion
Thus, from the aspects discussed above, it can be concluded that the role and importance of
outsourcing is increasing in this dynamic business environment. There are various aspects
which are responsible for the increasing use of this concept. This report has discussed these
aspects along with the aspects affecting the performance of the business adversely. This
report has discussed a summary of the literature review as well as different methods or
techniques for the collection of data related to the research topic. Limitations have been
discussed in this report which could have affected the execution process of this research
project.

Advantages and disadvantages of outsourcing business functions 16
References
Crossman, A., 2017, “An Overview of Qualitative Research Methods”, ThoughtCo.
Fita, M., 2012, “6 Reasons Why Social Networking is So Popular These Days”, Brandiginity.
Galetic, L., Aleksic, A. & Klindzic, M., 2011, “Outsourcing and Downsizing As Modern
Organizational Trends in Croatian Companies”, The Business Review, Cambridge, Vol. 17,
Number 1.
Johnston, M. P., 2014, “Secondary Data Analysis: A Method of which the Time Has Come”,
Qualitative and Quantitative Methods in Libraries, pp. 619 –626.
Mirza, A. A., 2012, “The Impacts of Outsourcing on the organisation and economy- A
critical Look on Ericsson Transformation Planning Outsourced to India”, Blekinge Institute of
Technology.
Nirmala, Y., 2013, “Chapter four: research design”, Language in India, vol. 13, no. 2, pp.
102.
Nishad, P.M. & Sankar, S., 2016, “Efficient random sampling statistical method to improve
big data compression ratio and pattern matching techniques for compressed data”,
International Journal of Computer Science and Information Security, vol. 14, no. 6, pp. 179.
Quick, J. & Hall, S., 2015, “Part three: The quantitative approach”, Journal of perioperative
practice, vol. 25, no. 10, pp. 192
Smith, N.L., 2015, “Using Action Design Research to Research and Develop Evaluation
Practice”, New Directions for Evaluation, vol. 2015, no. 148, pp. 57-72.
Sturgeon, T. & Gereffi, G., 2011, “Measuring Success in the Global Economy: International
Trade, Industrial Upgrading, and Business Function Outsourcing in Global Value
Chains”, Survey of Current Business, 91(2), pp.33–59, 61–66.