image.jpg - Chapter 12 Outsourcing project work Outsourcing > the transferring of business functions or processes to other foreign companies Advantages

image.jpg - Chapter 12 Outsourcing project work Outsourcing...

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Unformatted text preview: Chapter 12 Outsourcing project work Outsourcing > the transferring of business functions or processes to other foreign companies. Advantages of outsourcing project work include: 1. Cost reduction > Companies can secure competitive prices for contracted services, especially if the work can be outsourced offshore. 2. Faster project completion-> Work can not only be done more cheaply but also faster. Furthermore, outsourcing can provide access to equipment that can accelerate completion of project tasks. 3. High level of expertise-> A company can focus on developing its core competencies and hire firms with the know how to work on relevant segments if the project. 4. Flexibility > Organizations are no longer constrained by their own resources but can pursue a wide range of projects by combining their resources with talents of other companies. Disadvantages of outsourcing project work include: 1. Coordination breakdowns > Break downs are challenging, and those challenges are exacerbated by physical separation with people working in different buildings, different cities, and possibly different countries. 2. Loss of control-> Because the core team depends on other organizations that they have no direct authority over. 3. Conflict-> Projects are more prone to interpersonal conflict since the different participants do not share the same values, priorities, and culture. 4. Security issues > Confidentiality is a concern for companies have to be very careful when outsourcing processes like payroll, medical transcriptions, and insurance information. 5. Political hot potato-> Foreign outsourcing of wok is perceived as a major cause of underemployment and US companies are under increased pressure to keep jobs local. Request for proposal (RFP) Outline for the development of a detailed RFP 1. Summary of needs and request for action-> background and a simple description of the final project....
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