Strategic Management Assignment: Outsourcing in the Global Economy

This report analyzes the outsourcing strategies of Ford Motor Company (FMC) and CISCO in a globalized economy. The report examines how these companies, both based in the U.S., have outsourced various IT and technological services to India. Ford has outsourced IT software, development, and customer support to reduce workload and address technological issues, while CISCO has outsourced structuring and technological developments, establishing a research and development facility in Bangalore. The analysis covers the value chain activities outsourced, focusing on customer satisfaction and technological advancements. The report argues that these outsourcing activities enhance the companies' competitive capabilities and discusses the strategic alliances formed to manage these outsourcing relationships, highlighting the mutual benefits for both the U.S. companies and their Indian partners. The report references several academic sources to support its arguments and conclusions.

Running head: STRATEGIC MANAGEMENT
Strategic Management In a Globalized Economy
Name of the Student:
Name of the University:
Author’s Note:

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two companies in different industries that have entered into outsourcing agreements with
firms with specialized services.
Many companions have entered into outsourcing business along with other counties to
make sure that they can get a good amount of profit in the market. Outsourcing is useful as it
helps in a steady and smooth flow of business ideas and also about developing new products and
services for the market. However, this must be ensured that the two companies are abiding by all
the ethical rules and regulations so that they can maintain a proper political obligation as well
(Lacity & Willcocks, 2017). The two companies of U.S hat have entered into outsourcing
business are Ford Motor Company(FMC) and also CISCO. These two companies are among the
well known and popular companies of the U.S who have entered into the outsourcing business
with India. Ford is an automobile company of America that has outsourced the IT software, IT
development, IT customer support and other such technological services to India also that they
can reduce the workload and also make sure that they are being able to work over the
technological issues properly. E-commerce solution is mainly outsourced to India so that they
can gain several customers' and also make sure that they are being able to carry on with their
other works properly (Mani & Barua, 2015).
The other company is CISCO that has also outsourced some of its operations to India.
The company has mainly outsourced the Structuring and technological developments to India.
They have also been able to establish one of the second largest research and development facility

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in Bangalore. This is because they can want to get the technology relates solutions in a very fast
way and also in a time optimizing manner (Gerbl, McIvor & Humphreys 2016).
Describe what value chain activities the companies have chosen to outsource.
CISCO has developed a research and development center in India as that they can
develop newer products and also make sure that the technology-related solutions and the queries
are being solved at a very rapid rate. On the other hand, they have also outsourced one of their
most important value chain activity that is customer satisfaction (Johnson, 2016). This is because
they want their customers to get all the necessary support via the live chat processes.
Ford Motors have outsourced the technological developments and also the IT software
developments to India so that they can get the instant solutions and understanding about the
different advancements and developments that are taking place in the field of the technology and
IT software systems.
Outsourcing agreements and companies' competitive capabilities
The outsourcing activities do not threaten the competitive advantage of any of the
companies because this helps make the companies much more efficient (Kale, 2017). They can
treat their clients in a much better and faster way, Outsourcing their IT software development
and customer care services to India the companies have been able to make their services much
better and also developed the status of a more efficient company. For an example CISCO has

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been able to develop a large research and development center in Bangalore, India which has
helped them to get the brilliant Indian expertise in order to understand about the different new
innovations that are being developed in India and the different ways in which the same can be
used for the overall development of their activities worldwide.
Strategic alliances to manage their outsourcing
The companies have been able to develop strategic alliances because on one hand they
are outsourcing their jobs and on the other hand they are also generating good revenue for the
Indian companies as well. In other words, thee are facilities like onsite projects where the
employees from India or the other countries are being sent to work for the company headquarter
in the foreign locations. Therefore both the companies are getting mutually benefitted because of
the strategic alliance. CISCO is leveraging the networking skills of the Indian networking experts
and also, in turn, generating a good Global exposure and money for the development of the
Indian networking companies as well.

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References
Gerbl, M., McIvor, R., & Humphreys, P. (2016). Making the business process outsourcing
decision: why distance matters. International Journal of Operations & Production
Management, 36(9), 1037-1064.
Johnson, G. (2016). Exploring strategy: text and cases. Pearson Education.
Kale, D. (2017). Sources of innovation and technology capability development in the Indian
automobile industry. Institutions and Economies, 121-150.
Lacity, M., & Willcocks, L. (2017). Conflict resolution in business services outsourcing
relationships. The Journal of Strategic Information Systems, 26(2), 80-100.
Mani, D., & Barua, A. (2015). The impact of firm learning on value creation in strategic
outsourcing relationships. Journal of Management Information Systems, 32(1), 9-38.
Skorin-Kapov, J. (2019). Professional and Business Ethical Challenges. In Professional and
Business Ethics Through Film (pp. 187-246). Palgrave Macmillan, Cham.