Discussion: Strategic Management of Outsourcing at Microsoft, IBM

This discussion post examines the strategic management practices of Microsoft and IBM, specifically focusing on their outsourcing strategies within the global economy. The analysis highlights the importance of risk management frameworks in navigating the challenges of outsourcing, particularly in the technology industry. The post references key articles that discuss the impact of outsourcing on profitability and supply chain networks. It provides a comparative analysis of Microsoft and IBM's approaches, including their use of suppliers, cloud computing, and investment in technology. The discussion also touches upon the significance of strategic human resource management and innovative ideas for achieving organizational goals. It emphasizes the need for proactive research and strategic planning to address competition and achieve market success, as supported by academic research and real-world business applications. The post also includes a discussion on the importance of managing cybercrime risk in outsourcing operations.

Running head: MANAGEMENT
Strategy management in a global economy
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Article: Bahli, B. and Rivard, S., 2017. The Information Technology Outsourcing Risk:
A Transaction Cost and Agency Theory-Based Perspective. In Outsourcing and
Offshoring Business Services (pp. 53-77). Palgrave Macmillan, Cham.
Most of the companies like Microsoft and IBM have adopted outsourcing for
expanding the scope and arena of the operations. Outsourcing the information has both
positive and negative connotations, affecting the profitability of the technology industry.
Conceptualizing the potential risks is a means for enhancing the awareness of the readers
about the challenges, which the companies encounter while conducting the outsourcing
activities (Bahli and Rivard 2017). Risk management framework is used by the industry for
mapping the intensity of the risks and its impact on the overall productivity. Consideration of
the actual scenarios is an aid in terms of enriching the knowledge about overcoming the
external challenges according to the needs, demands and requirements of the stakeholders.
Hiring the agents, through negotiation, is a direct initiative towards expanding the dynamics
of the business, adding diversity into the operations of the industry. Mention can be made of
Microsoft Company, who holds meeting for conducting audits for the planned strategies.
Comparative analysis of Microsoft and IBM regarding value chain analysis
In case of Microsoft, hiring numerous suppliers from overseas borders expands the
scope and arena of the supply chain network. Intelligent cloud computing systems is
assistance in terms of adding digitalization into the business. Liu and Xu (2017) is of the
view that Original Equipment Manufacturers (OEM) expand the distribution channel. On the
other hand, machining, packing, assembling and testing governs the supply chain network of
IBM. Technology is assistance in terms of selecting the raw materials and applying business
models for developing customer loyalty, contributing to the growth and development of the

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technological industry. Typical example can be cited of investing on the high pay programing
jobs, which IBM bears for enhancing the ties with China in lower costs.
Abstract
Managing is an essential aspect, which is vital for systematizing the operations
according to the identified and specified targets. This is also applicable for technological
industry, in case of outsourcing for averting the illegal instances of cybercrimes, which can
degrade the fame and glory of the companies like Microsoft and IBM. Risk assessment and
management gains an important position in this context for mapping the challenges, which
the industry might encounter in the process of outsourcing the operations to the native and
overseas clients.

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References
Bahli, B. and Rivard, S., 2017. The Information Technology Outsourcing Risk: A
Transaction Cost and Agency Theory-Based Perspective. In Outsourcing and Offshoring
Business Services (pp. 53-77). Palgrave Macmillan, Cham.
Liu, Y. and Xu, X., 2017. Industry 4.0 and cloud manufacturing: A comparative analysis.
Journal of Manufacturing Science and Engineering, 139(3), p.034701.
Saorín-Iborra, M.C., Redondo-Cano, A., Revuelto-Taboada, L. and Vogler, É., 2015.
Negotiating behavior in service outsourcing. An exploratory case study analysis. Service
Business, 9(4), pp.771-801.