Offshoring Vs. Outsourcing In The Workplace

1205 Words 5 Pages
For one to begin a proper analysis on outsourcing, an appropriate definition must be established. defines outsourcing as “(… a company or organization) to purchase (goods) or subcontract (services) from an outside supplier or source”. In other words, outsourcing allows different aspects of a business to be handled by those outside of the business, often through a contractor, who is a person or company that undertakes a contract to provide materials or labor to perform a service or do a job. (“outsource,” n.d.). Contractors are different than employees, dependent upon whether or not a worker is considered to be an employee or contractor can present serious legal dispute for some companies.
There are many reasons why a country
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The difficulty of outsourcing is dependent upon a company’s ability to hire and maintain workers and whether the outsourcing is domestic or foreign. However, before discussing foreign outsourcing, it is essential to be able to differentiate between offshoring and outsourcing. Offshoring is when a company does work differently from its own while outsourcing is the process of hiring contractors to do work that a company usually do themselves. However, it is possible for a business to outsource offshore. (“Offshoring vs Outsourcing,” n.d.). Local outsourcing can be as simple as hiring an accountant to handle the accounting for a business. Foreign or overseas outsourcing has the potential to be a more complicated endeavor. Businesses can handle all of their tech support and manufacturing in other countries as they often do. For example, though Apple Inc. products are designed in California as it is engraved on its iPhone, all of the manufacturing is done outside of the United …show more content…
A small business can save money by hiring fewer employees and more contractors, who are less expensive to a business especially when hiring in other countries. (Wililams, n.d.). This is why the cost of labor is one of the most common reasons for outsourcing overseas. (Lach, 2012). Smaller businesses tend to already have less resources and staff so seeking professionals free the business from undertaking all the duties that a business may need and allow them to focus on growing the business. (Wiliams, n.d.). Another great benefit is the transference of risk. Allowing some of the various risks of business to be transferred to someone who is more qualified to handle the task can benefit for businesses of all magnitudes.
Though deciding whether or not a business should outsource can be a difficult process, analyzing the effects of outsourcing on the economy, specifically outsourcing oversees is not an easy feat. The public perception of outsourcing in America has almost always been a poor one because many people believe that these jobs should be available to those who live in the United States. This is why companies tend to be quiet on its outsourcing practices. (Lach, 2012). Outsourcing often seems to be a great strategy for business, however, at the expense of

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