How is outsourcing an efficient business?

Answer 1

well, it's not. management bought the idea from consultants, who will make money at both ends, firing and hiring.

Answer 2

Companies save money on employee costs. Let me give you an example.

McDonald's corp. was thinking about outsourcing their drive up window employees to a call center in India. In effect, when you would go to McDonald's and order your food, you would NOT be talking to some guy or girl in a drive up window just a few feet away, but instead to an Indian guy or girl, thousands of miles away. The call for your order would be sent to India and then relayed back to McDonalds and presto! Your food still ready within seconds!

Why would McD's outsource this avenue of business? They figured that they would save literally 2 cents per order and over a Million dollars each year!! Theyr'e also saving a little bit on paying those employees (though they have to make up for that with Indian employees, payed a little less, but the calls would cost)-though they figured they'd make a profit by outsourcing this part of the business to others to do it for less, and perhaps even more efficiently!

Answer 3

Keeps costs low--and generates more profit. Companies that have greater profit will expand and invest, thus creating more jobs. It also fosters competiton. If you force companies to keep jobs in an environement where the work force costs too much, then profits fall--investors don't make as much--and then the company will be forced to cut back and lay people off--thus making LESS jobs available. I gave you a very simplistc example of how it works-but that's how I understand it. If you are on the end where the jobs are leaving, it sucks. But it does force that group of people to become innovative and create different jobs that the work force is capable of doing that job the best and most efficiently.

Answer 4

outsourcing is definetly an efficient business.Following r it advantages.
1) it gives u forgein currency
2) it increases Employment oppourtunity.
3) it provides good pay package to Youngsters.
4) it helps to know & increase forgein Accent.
5) it pays higher taxs to government.

But there r some disadvantages.
1) it is highly risky for the company, as there r chances of fraud with the data given.

Also it depends upon the region where ur business is located:-
1) Avalibilaty of educated manpower.
2) Proper infrastructure
3) Policy of the Govt. regarding outsourcing

Answer 5

Outsourcing is efficient compared with regular in house support for the following reasons :

- It has no capital investment ; no expense for office space-utilities; no salaries/overtime pay for employees; no vacation/sick benefits to employees; no payroll taxes & premiums incurred.

While regular in house support incurrs the following :

- needs subtantial IT/Equipment outlay; incurres variable, material expenditure; incurres vacation & sick leaves which are equivalent to 30 days per annum; incurs high payroll taxes which are imposed at around 8% to 25% of basic rate.

Answer 6

It doesn't make sense to pay high wages for people to perfom menial tasks. Therefore, companies go overseas to places like China and India to hire workers who expect far less monatarily from an employer.

Outsourcing, if not overdone, is very beneficial to the American economy, as American workers then move into higher skilled areas of the workforce.

Answer 7

Outsourcing and free trade is destructive to the American economy and way of life. Only narrow minded fools who have been brain washed by the theoretical rhetoric and ideological philosophies would believe otherwise. The proliferation of outsourcing and so called "free trade" will mark the turning point of the American economy as the leading economy in the world. That is not to say it isn't very lucrative for a select group of Americans. Selling out of America has proven very profitable for some and they will continue promoting these short sighted solutions to fill their wallets, while selling out America's future.

In order to see through the nonsense and half witted arguments that have been created in order to promote these concepts one simply has to analyze what it really means to "compete". Alan Greenspan claimed that Americans simply need better training in order to compete in the global economy. It is a shame that such an intelligent person has succumbed to telling such blatant lies. For he must realize that when companies like Dell outsource, it is not because the people they are outsourcing to are smarter or any more motivated. It is because their labor is cheaper. For as long as the United States has been in existence it has been cheaper to have work performed in China. However, until China was brought into the WTO it was against the law in the U.S. to outsource technical jobs there.

The equation is simple, it is always going to be more expensive for labor in a mature economy like the US or Japan than it is in a third world economy. The fact is that the US has a very mature economy. It has rules that form the basis for "fair" trade. The Environmental Protection Agency is a perfect example. If a company has to abide by the rules of the EPA in the US, but another company in India does not have to, then the company in India will have an advantage. The same goes for a company in India that doesn't have to match employee social security or Medicare taxes. With a little thought one could see that this applies to an entire realm of things. There is a minimum wage in the US. How can a person making minimum wage in the US compete with a Chinese employee doing the same job getting paid the equivalent of fifty cents per hour? They may work just as hard and perform work that is the same quality, but the Chinese will win as long as they have no minimum wage or it is lower than the minimum wage in the US.

Therefore, THE MAIN BENEFIT OF OUTSOURCING IS TO AVOID THE RULES that have developed over time in a mature economy. Since other countries allow employers to play by vastly different rules than the US does, OF COURSE IT IS CHEAPER TO DO WORK THERE! This is defined as a RACE TO THE BOTTOM! The middle class in the U.S. has spent decades trying to raise the standard of living of middle class workers. If you remember, during the early years of this century 12 hour days in sweat shops to build fortunes for a few wealthy factory owners was the norm. If you're in favor of outsourcing and so called "free" trade in it's current form, then you're saying you want to go back to the past. Of course the wealthy barons would have to agree with you….they liked the past. These are the same types of people that did not have a problem with slavery.

If you want "free" trade as described by text books you need something that text books never mention….FAIR RULES TO GOVERN TRADE THAT EXTEND BEYOND BORDERS so that it is in deed fair trade. Only a complete moron and total idiot would believe you could maintain a "competitive" environment without strict rules to govern trade. After all, why are there rules in the Olympics? TO FOSTER COMPETITION! Otherwise the winners would be those that used the most steroids or perhaps those that figured out that if they use a cork filled bat they could hit the ball farther. Hardly the best performers.

WAKE UP AMERICANS!….you're being led astray by the wall street investment bankers who want to get a foot in the door in emerging markets. They're willing to trade YOUR job so that they can invest in these booming countries. They no longer feel bound to this country….after all, with their millions they can live anywhere, even if the economy and the future of the US goes in the s*$t can.

So basically, what so called free trade and outsourcing amount to is here…..we'll give you some loser middle class worker's jobs, if we can be granted the privilege of owning something in your country and buying investments there. Note the people offering up jobs in exchange for access are not offering up their own jobs. After all, though we can outsource and send every last job in America to places like India, and people from India or virtually anywhere in the world can invest in American companies and buy property in the US, IT IS ILLEGAL FOR AN AMERICAN TO BUY PROPERTY IN INDIA OR CHINA or for the most part invest in the countries that our leaders are tripping over each other to offer up the jobs of Americans…..so their investment friends can be wealthier and more powerful. Hardly beneficial for the average American who can expect a lower standard of living in the very near future.

Answer 8

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