Executive SummaryThis report is written to provide information on offshore outsourcing and to discover what challenges await a small company that plans to get on it. By way of completing this report, practical suggestions are provided as to how the obstacles to offshoring may be surmounted. Facilitated by globalization and information and communication technology, affshoring, as it is known now, is relatively new. It was practically an offshoot of ever evolving history of economics, which is essentially concerned about lessening the cost and maximizing the gains of doing business.
When this business option – with its advantages and disadvantages – is taken, offshoring has significant impact on the ways by which a business is managed. It results to having a diverse workforce, which requires a kind of leadership fitting for the kind of situation that it gives rise to. It impacts, too, on the kind of decision making style and process that the management follows and the system of human resource management that it implements. The planning and organizing functions of management is not spared either. Offshoring may be carrying with itself several challenges, but there are several measures that the management may undertake to get over these hurdles.
For now, what is certain is that offshoring is going to be here as a business option – open even for small organizations. TABLE OF CONTENTSExecutive Summary1IntroductionBackgrounder on the report3The objectives of the report3Layout of the report3Conclusions from the research3-4OffshoringWhat is offshoring? 4-5Advantages of offshoring5-6Disadvantages of offshoring6-7People ManagementManagement of diverse workplace7-8Leadership8-9Decision making9-10Human resource management10-11Planning and organizing11-12Conclusion12References13IntroductionBackgrounder Rethinking the way how the business organization is run, the management of small firm of fifty (50) persons seriously considers the option to have some key support functions of the business – such as the IT services, accounting, customer service and marketing – be offshored.
This report is preliminary to deeper consideration of offshoring as a business option. The objective(s) of the reportThis report specifically delves into the fundamentals of offshoring, but its main concern is on the difficulties that are faced with managing staff in another country. This is meant to inform the management of a small business organization as they consider taking offshore outsourcing as a business option. The layout of the reportThis report is made up of two main sections.
The first section focuses on the practice of offshoring, and brings to the surface the advantages and disadvantages that go with it. The second section identifies five management areas that will be impacted on by offshoring, features a short and snappy discussion of these, and makes suggestions as to how these impacts may be addressed. Conclusions from the researchExpectedly, emerging business options necessitates adjustments especially on how firms are managed. Offshoring has accompanying challenges. But there are also measures that may be taken to offset these.
This is especially significant to note as it constitutes a step towards a deeper probe into the option that the firm has taken. That is, having considered the advantages and disadvantages of resorting to offshore outsourcing, its practicalities may now be dwelt on. OffshoringWhat is offshoring? To more fully understand offshoring, it needs to be comprehended from within the bigger context of outsourcing. Outsourcing is the transfer of non-core business operations from internal employees to an external organization. More specifically, it is the use of external resources to carry out activities that were performed traditionally in-house (Pyndt & Pedersen 2006, pp.
11). As a strategy, outsourcing makes a company focus on its core business, add value to the outsourced job and save costs (see Green 2007).