A Comprehensive Research Proposal on Business Function Outsourcing

This research proposal examines the concept of business function outsourcing, exploring its advantages, challenges, and impact on organizational efficiency, productivity, and cost-effectiveness. The study reviews existing literature to identify gaps and formulate primary and secondary research questions. It aims to investigate the benefits and drawbacks of outsourcing for individual firms and the economy, utilizing both qualitative and quantitative research methodologies including interviews and surveys. The proposal outlines the research design, methodology, limitations, and a detailed time schedule. The research seeks to determine which business functions are most frequently outsourced and the value generated by these processes, while also addressing potential issues such as job market impacts and data security. The conclusion emphasizes the strategic importance of outsourcing for cost reduction and the need for further research into its ethical and legal aspects.

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Research Proposal on Business Function Outsourcing
Student’s Name
Course ID
University
Date

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Table of Contents
1. Introduction..................................................................................................................................3
2. Project Objective.........................................................................................................................3
3. Project Scope...............................................................................................................................4
4. Literature Review........................................................................................................................4
5. Research Questions/Hypothesis...................................................................................................6
6. Research Design and Methodology.............................................................................................7
7. Research Limitations...................................................................................................................8
8. Time Schedule.............................................................................................................................9
9. Conclusion...................................................................................................................................9
10. Reference List..........................................................................................................................10
11. Appendix..................................................................................................................................12
Appendix 1: Questionnaire........................................................................................................12
Appendix 2: Gantt chart.............................................................................................................15

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1. Introduction
The study paper identifies how modern corporate business firms are using the concept of
business function outsourcing. Precisely, the concept of outsourcing encourages modern
corporations to perform the supportive tasks and management activities by a third-party
organisation (Sako and Tierney, 2015). Under a contract agreement, companies can provide
some less important HRM tasks to the professional third-party enterprise. In this way, a large
organisation can save significant time, resources, and capital for the core business activities that
will deliver the majority of the earnings (Weidenbaum, 2015). The study discusses the past
literature and subsequent literature gaps. Furthermore, the study identifies primary and secondary
research questions based on which the entire study will be conducted. At the same point in time,
the paper describes the research design, methodology, limitations, and research plan as well.
2. Project Objective
The primary objective of the research is to identify the advantages of business function
outsourcing that benefits the organisation in terms of increased efficiency, productivity and cost
effectiveness. Additionally, the study aims to evaluate the challenges faced by the modern
organisations in outsourcing a particular business function to a third party enterprise.
Furthermore, the research will analyse the benefits and drawbacks of outsourcing that are faced
by the individual firms as well as the economy on a whole. Moreover, both the primary and
secondary data will be used in the research to know the business functions that are majorly
outsourced and value generated by the outsourcing processes.

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3. Project Scope
By identifying the literature on the concept of business function outsourcing, the study
has delivered primary and secondary questions that will be taken into account for the further
research. Furthermore, the entire research design describes the process of quantitative and
qualitative research methodology that can be considered to collect primary and secondary data
and information related to the study (Retová and Pólya, 2011). Also, the research plan has been
given for the reader to identify the schedule of the research study.
4. Literature Review
In the contemporary business environment, modern companies have precisely valued the
outsourcing process to get a job done by the third party professionals. According to Lee and Choi
(2011), the process of outsourcing cannot be defined as the core business activity of a corporate
firm although the outcome of the procedure is significantly profitable for the organisations.
Currently, a number of HRM functions including marketing, customer support, and accounting
system has been outsourced involving third-party professional companies. Effectively, during
outsourcing of a business function, the management of a firm must include the legal obligations
and terms to the outsourcing company so that any misconduct can be dealt under the legal
procedure. In this way, security of data and information can be protected. Primarily, modern
organisations have opted for outsourcing of business functions due to a number of reasons.
According to Lin, Pervan, and McDermid (2007), outsourcing reduces the organisational cost.
For instance, to complete a function by a specialist will require significant investment and
maintenance as hiring can be expensive for the management. Therefore, to reduce the cost, the
process of outsourcing can be taken into account.

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Furthermore, by outsourcing the less prioritised business functions, firms can concentrate
on the core business activities that will lead to a higher amount of profitability. Clearly,
outsourcing some of the supporting activities in the business can provide ample space and time
for the organisational human resources to shift the focus on core business activities that can earn
the majority of the revenue (Kremic, Icmeli Tukel and Rom, 2006). Apart from such benefit, the
aim of outsourcing functions is to increase flexibility in the HRM. As support activities are
shifted to the third party, the accountability of the support tasks is eliminated from the shoulder
of the management. In this way, management can become more flexible to control the core
activities profitable for the business. In addition to that, outsourcing provides quality of service.
As an organisation assigns significant HRM functions to the professionals, quality of service can
be enhanced. In this way, the technique of outsourcing can improve the overall performance as
well (Whitfield, 2014).
Apart from the advantages, there are a number of harmful effects related to the
outsourcing of functions. Most essentially, outsourcing can make a massive impact on the job
market. As corporate businesses have outsourced the tasks to other countries, the number of
employment has been reduced. Besides, security of information and data can become a huge
question in case of outsourcing of functions. In order to outsource the tasks, corporate
information has to be shared with the third party that can be a threat to the security of a company
(Fitz-Enz et al., 2014). Also, many of the time, outsourcing can provide poor results due to lack
of monitoring. With the firm, the functions have been supervised time to time to get the most
appropriate outcome whereas in case of outsourcing such things can be overlooked at times.
In the meanwhile, the review of the literature mostly elaborates the pros and cons of
outsourcing. However, in the bigger perspective, the academic researchers must evaluate how

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outsourcing has opened up job opportunities at the emerging economies (Lall, Gereffi and
Sturgeon, 2009). In the time of the internet and digital media, outsourcing has become one of the
most effective tools for the HRM to get the supportive activities in a cost-effective manner.
Although there are ethical concerns and customer resistance associated with the outsourcing,
precise policy and strategy can eliminate such risks in the upcoming time. Additionally, further
study should be focused on the legal aspects that can strengthen the validity of outsourcing in
corporate business (Raiborn, Butler and Massoud, 2009). In terms of business benefits,
outsourcing encourages corporate firms to invest the most valuable time, resources, and capital
to the core activities that can deliver the majority of the revenue.
5. Research Questions/Hypothesis
The primary research question that will be answered in the study is presented herein
below:
 How does business functions outsourcing benefits an organisation and what are the
problems associated with business functions outsourcing?
Furthermore, some of the secondary research questions that will be analysed and
answered in the study are:
 What sorts of business functions are primarily outsourced?
 Is business function outsourcing an effective way of reducing operations costs?
 What economic benefits are achieved through business function outsourcing?
 Does business process outsourcing leads to organisational effectiveness and increase in
productivity?
 How business process outsourcing does lead to outflow of money to foreign economy?

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 How do the organisations in emerging economies get benefitted through business process
outsourcing?
6. Research Design and Methodology
Qualitative research
Qualitative research is a type of exploratory research that is conducted to understand the
reason, motivations and opinions regarding a particular problem. Qualitative research provides
better understanding of the problem and helps to develop ideas to solve the issue. In this
research, the qualitative research technique will be used by conducting primary interview of 3 to
5 entrepreneurs belonging to different organisations. The interviews will be conducted over
phone calls or face-to-face meetings (Gray, 2014). The entrepreneurs will be asked about their
views regarding outsourcing of business processes and the problems faced by them while
entering into an outsourcing agreement. Additionally, the secondary data will be used to backup
the findings through adequate theory and literatures. The secondary data collected from various
articles, reports, books and online sources will be used to check the validity and reliability of the
primary data (Fletcher, 2016). The analysis will be based on hypotheses to find out the
advantages and problems related to outsourcing. Finally, the findings of the study will be
presented in a descriptive manner to answer the research questions and hypotheses.
Quantitative research
Quantitative analysis will be conducted in the research in order to check the validity and
reliability of the primary data collected from the participants in the form of questionnaire
surveys. Online surveys will be conducted to collect data from around 125 to 150 participants
working in different organisations at different position. However, the research will aim to

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interview management level people from both developed as well as emerging nations in order to
gain adequate information about the outsourcing processes (Elmarie, Yaeesh and Nirupa, 2012).
Furthermore, SPSS tool will be used to conduct statistical analysis in order to perform
correlation text, ANOVA test and several other numerical analyses (Gray, 2014). Additionally,
the findings of the statistical analysis will be presented through descriptive analysis in order to
backup the results with previous findings and literatures.
7. Research Limitations
In the research, a number of complexity and limitations have to be taken into account so
that the entire study will evaluate the most effective outcome. Precisely, in case of selecting the
research methodology, the researcher has to provide the process of methods as well as validity of
the analysis. On the other hand, sampling of the research has been a leading challenge for the
researcher. During the primary research, a number of limitations and ethical guidelines have to
be followed so that the research outcome cannot affect the interviewers (Lacy, 2014). The
personal information of the interviewers has been kept hidden according to the policy of the
research. Evidently, lack of extensive experience of the researcher can be defined as a major
limitation of the research study. Therefore, the researcher has to adopt precise data collection
method via questionnaire to get the primary data. In terms of research scope, lack of professional
experience can be reflected in the research area as well (Lacy, 2014). Due to this, the depth of
the discussion has seemed to be compromised at different stages of the research. Hence, the
research outcome cannot be compared with the research conducted by academic scholars.

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8. Time Schedule
The limitation of time is a major constraint for a research and a proper research plan is
required to complete the paper in time. It is assumed that the entire research will require around
12 weeks to be completed. Furthermore, the time required for the collection of primary data will
be 4 weeks. A detailed time schedule for the research has been presented in appendix 2 with the
help of a Gantt chart for further consideration.
9. Conclusion
By considering the above proposal, it can be seen that outsourcing of business function is
a primary strategy for several international expanding companies to minimise their cost.
However, there are several challenges that are faced by the organisations while outsourcing the
business processes to third party enterprises. Moreover, outsourcing of business functions lead to
drainage of domestic earnings to foreign markets and negatively impacts the employment in the
home country. Hence, the research will evaluate the benefits as well as problems associated with
outsourcing of business functions in details in order to help the management level executives in
better decision making.

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10. Reference List
Elmarie, P., Yaeesh, Y. and Nirupa, P. (2012). Internal audit function: Current status and
perception of outsourcing. African Journal of Business Management, 6(49), pp.11829-11838.
Fitz-Enz, J., Lawler, E., Madden, J. and Ulrich, D. (2014). Human resources business process
outsourcing. 4th ed. San Francisco, Calif: Jossey-Bass.
Fletcher, A. (2016). Applying critical realism in qualitative research: methodology meets
method. International Journal of Social Research Methodology, 20(2), pp.181-194.
Gray, D. (2014). Doing research in the real world. 4th ed. London: Sage Publications.
Kremic, T., Icmeli Tukel, O. and Rom, W.O. (2006). Outsourcing decision support: a survey of
benefits, risks, and decision factors. Supply Chain Management: an international journal, 11(6),
pp.467-482.
Lacy, S. (2014). Reducing Limitations on Practical Academic Research. Newspaper Research
Journal, 15(2), pp.76-82.
Lall, S., Gereffi, G. and Sturgeon, T. (2009). Measuring success in the global economy:
International trade, industrial upgrading, and business function outsourcing in global value
chains. Transnational Corporations, 18(2), pp.1-35.
Lee, J.N. and Choi, B. (2011). Effects of initial and ongoing trust in IT outsourcing: A bilateral
perspective. Information & Management, 48(2), pp.96-105.

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Lin, C., Pervan, G. and McDermid, D. (2007). Issues and recommendations in evaluating and
managing the benefits of public sector IS/IT outsourcing. Information Technology &
People, 20(2), pp.161-183.
Raiborn, C., Butler, J. and Massoud, M. (2009). Support function outsourcing: the hidden
costs. International Journal of Strategic Business Alliances, 1(2), p.205.
Retová, J. and Pólya, A. (2011). Offshore Business Process Outsourcing. Studia commercialia
Bratislavensia, 4(15).
Sako, M. and Tierney, A. (2015). Sustainability of Business Service Outsourcing: The Case of
Human Resource Outsourcing (HRO). SSRN Electronic Journal.
Weidenbaum, M. (2015). Outsourcing: Pros and cons. Business Horizons, 48(4), pp.311-315.
Whitfield, M. (2014). Strategies: Energy IT and Business Process Outsourcing-Key Concepts
and Trends. Natural Gas & Electricity, 31(3), pp.24-27.

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11. Appendix
Appendix 1: Questionnaire
Please answer the following questionnaires as per your choice:
1. Name: ___________________________________________________________
2. Designation: ______________________________________________________
3. Name of Organisation: ______________________________________________
4. Country of the Organisation:__________________________________________
5. Age: ____________________________________________________________
6. Gender: _________________________________________________________
7. Number of employees (size of the organisation)
a. Less than 250
b. 251 to 500
c. 501 to 1000
d. More than 1000
8. What functions does your organisation presently outsource (Please tick all that apply)
a. IT support or training
b. Recruitment
c. Credit control
d. Payroll services
e. Accounting or book keeping
f. Other (Please Specify) _____________________________________
g. Not Applicable