Business outsourcing case styudy

Business outsourcing case styudy - Keenan Ebanks Worlds...

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Keenan Ebanks World’s Airlines Increase Outsourcing 1. Explain the tern ‘outsourcing’ Outsourcing is the process of using another business to undertake some task or work process rather than doing it within the business, e.g. the manufacture of components or the provision of a specialist service such as IT training. 2. Analyze two potential benefits to major airlines from outsourcing the maintenance of their aircraft. Major airlines may benefit greatly from outsourcing their maintenance of the aircraft. One major advantage is that they can hire mechanics for much cheaper prices. In the case study it states that most global airlines would pay up to $60 per hour for their own highly qualified mechanics. However Mechanics working for outsourcing companies don’t have to be qualified and usually earn between $10 and $20 an hour. This is huge cut compared to having internal mechanics. This saves a lot of costs for the business and would therefore increase profit margins. Another huge advantage with outsourcing the maintenance of their aircraft is that the business can therefore concentrate on the core of the business. By outsourcing all non- core functions, such as maintenance, employees can be put to better use. An example would be one of the major airliners using their mechanics for maintenance all the time instead of designing more efficient parts of the airplanes. 3. Explain two reasons why Malaysia Airlines may not want to outsource in-flight retailing.     Malaysia Airlines views their in-flight retail business ‘Golden Boutique’ as a ‘non-core, but good value’ business. This means that they will want to make sure this business is run the way they want it in their style to make sure it maintains its good value. If this was
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This note was uploaded on 12/07/2011 for the course ECON 101 taught by Professor Vladimir during the Spring '11 term at Central Mich..

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Business outsourcing case styudy - Keenan Ebanks Worlds...

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