The paper "IT Outsourcing and Offshoring of Personnel in the Financial Sector" is a perfect example of a finance and accounting essay. IT outsourcing and Offshoring continue to be on the increase with increased reforms in the financial sector. As the situation turns from bad to worse, there is a developing conflict between senior managers in the financial sector and their IT department employees. In an article by Bennet (2012) in the Australian on the increasing cases of IT offshoring, Bennet points out that with the increasing costs of maintaining IT departments and functions in financial institutions, outsourcing and offshoring seems to be the most logical answer.
Westpac Bank and Macquarie are some of the affected financial institutions as they aim to reduce the running costs of their businesses. Westpac bank mostly offshores its IT workers to India while Macquarie is reported to have culled about 1000 jobs and offshored many more. The finance sector union estimates that a minimum of 6000 jobs in Australia has been offshored between 2007 and 2012 and that there is a high probability that the trend will continue.
While employers view offshoring as an opportunity to reduce their operating costs and make back on their investments, offshoring is not a very welcome idea to worker’ s unions and the thousands of employees losing their jobs. This paper will study the conflict brought about by outsourcing and offshoring of personnel in the financial sector. It will come up with solutions to this continuing conflict between senior management and their employees and settle on the best solution among the available solutions. Offshoring Nassimbeniet al(2011) defines Offshoring as the relocation of processes of an organization from one country to a foreign country irrespective of the affiliation between the service provider and the offshoring organization.
Outsourcing on the other hand is the relocation of services or processes to external providers, their location notwithstanding.
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