Outsourcing pro and cons

Outsourcing has many advantages but at the same time it has some disadvantages that cannot be ignored. So let us look at some outsourcing pros and cons

Pros of Outsourcing

• Global outsourcing gives employment opportunities in developing countries like India, China, Philippines, Mexico, Brazil etc.
• Offshore outsourcing helps increase the standard of living in third world countries
• Companies in developed nations can cut huge costs and concentrate on their core businesses by outsourcing their back office jobs
• Outsourcing helps the companies in developed nations to provide better customer satisfaction
• Customers in developed nations can get cheaper and newer products with better service
• Outsourcing can help people produce newer and better jobs in the long run

Cons of Outsourcing

• As services get outsourced to off shore destinations, there are large scale job losses in developed counties
• If companies outsource without proper research and planning they can get heavy losses
• Customers in developed nations can get annoyed if they find out their personal details (bank, credit-cards etc) are in foreigner hands
• Lack of communication between the parent company and their outsourcing partner could lead to major losses.

The Bush government has stopped federal government IT outsourcing but at the same time support other forms of offshore outsourcing. According to the Bush government political implications of insourcing will cut out the job losses caused because of outsourcing us jobs. Most economists also believe that Outsourcing jobs to foreign countries will help improve the US economy in the years to come.



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