US outsourcing jobs to third world countries-Pros and Cons

With the aim of cutting cost, the US companies are outsourcing their jobs to third world countries.  Yes, US, has accepted the outsourcing of various service sector jobs.  Various US companies like IBM, Microsoft, Accenture and the likes have been adhering to this trend by hiring the workforce in developing countries.

With the advantages of globalization being so more profitable, major economies of the world are behind reaping the profits from it. However, profitable this may sound; the outsourcing has both benefits and disadvantages attached to it. This article shall give a small summary on the merits and demerits of outsourcing.

Pros:

Many US based multinational companies in the run up to cutting costs, are choosing to outsource some of their functions to outsourcing companies in developing or third world countries like India, China, Philippines and the likes.

The advantages reaped range from cost cutting benefitting the multinationals, to the companies residing in developing countries, and their economy.
It is obvious that when a US multinational company is outsourcing their functions to the companies in developing countries, are cutting operational costs, thereby earn more revenue and getting the same work done at lower price and  at an excellent quality.

On the other side, this trend is also benefiting the companies in third world countries, for, they are getting more work, more work means, more employment done for getting more employees, more projects, more profits.

This not only affects positively the growth of the company but when looked from the macro level, this trend facilitates employment generation and industrialization, much needed in developing countries to help pump their economy and development.

Cons:

However, this is only one side of the coin.  There is also the second side of the story, which is a bit more critical about the trend of US jobs outsourced to companies in developing countries.

When a US company outsources its operations/jobs to companies in developing countries, it is earning more and it helping let develop the economy of the vendor outsourcing company, however, this is said to have a negative impact on the US's economy.

The outsourcing of jobs means the employees working on that particular job are no more employed. This means the trend is to have a negative impact on the employment rate of the US economy. Once, the employment goes down, this creates the discontent among the workers with their employers.  This might lead to immigration of talented unemployed workforce to the other countries; the employers in the need to cut down on costs might never realize the worth of the unemployed workforce. It might even lead to a rebellion, one between the haves and haves not.  This might create an entire imbalance in the economy and polity of the state and might affect their overall growth and development.

Therefore, it is of vital importance for US companies that while reaping the benefits of global economic trends, and wanting to accelerate company profit, also be careful and diligent enough in fulfilling their duties as socially and economically responsible employers towards the state they are located in and are working for.

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Slap Recession - support your Economy by Outsourcing

Today, outsourcing has become the order of the day. Its advantages are far, wide and strong and not enough can be said about it. Major economies of the world, hard hit by economic times, can now sustain their business and keep it floating by resorting to transferring some of the non –core functions to outsourcing companies in third world countries.

Let us see how outsourcing in third world countries can land companies in west a helping hand in such times:

With the trend of globalization on high, outsourcing some of your non-core functions to outsourcing companies in developing countries can help you cut down on operational costs that would have to be borne had you still managed to work on those processes.  These developing countries have the advantage of providing you services at low cost by educated bunch of professionals at great quality level.  So, after outsourcing your functions, you can easily focus your finances and manpower on core functions while also be rest assured of the fact that your non-core functions are being taken great care.

By outsourcing to companies in developing countries you're also finding it relieved over the fact that you won't have to compromise on issues of laying off your personnel and budget squeezing. Since, you no longer are responsible for that function, you are extremely carefree and you know that your work will be done by them and that their employees shall help finish all your assignments in a timely manner. The budget that you've had allocated for those functions, can now be scrapped and in such time you can utilize the finances from that budget in other urgent needful liabilities to be put off.

With due finances in the outsourcing companies, there is no fear among these companies that their employees shall be axed or that they will have to minimize on their functions or cannot just complete the work due to lack of finances, and thus, the employees of the outsourcing company can freely complete the work of the parent company and help keep their clients happy and accelerate their growth.

Thus, with this current trend of globalization, it would be a fool's job if you don't utilize the advantages that the trend has to offer you.  By allowing your economies to integrate, you're allowing to ease your condition and position in this time of recession.  Thereby, allow your company to co-depend on the strengths and powers of your developing nation's companies by outsourcing and reap the benefits even out of recession.

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Factors to consider while option for an apt Outsourcing Company

It is of considerable significance for a fast growing company, large company or small company, the necessity to outsource. In this day and age of globalization, market by rapid growth in technology and wreaking economies, outsourcing your company's non-core business functions might help you lot. While you can focus on core functions, the outsourcing company can help you make stronger by performing on lesser important functions.

However, when you plan to outsource your work to a company, you have to make it sure that you choose an outsourcing company that is seamless and is better able to comprehend your company's requirements and is willing to offer you just what you want.

Following are some of the vital factors that need to be taken in consideration whilst you choose your perfect outsourcing company:

1. Hire that outsourcing company which provides you with cost-effective as well as competent services
2. Make sure the company you choose for your outsourcing work, has a good, well-organized management team, a team marked by the extraordinary industry exposure and thus skillful.  This will ensure balanced employer-employee relationship between both the companies and effectively solve customer as well as employee problems, if faced any.
3. Ensure to make an accurate SLA – Service Level Agreement. It is an official legal document which mentions clearly all your work requirements, your quantitative and qualitative work expectations from your outsourcing company.  Mentioning all that you require, is said in a simple, short and sharp way, in an official legal document, helps minimize confusions should any problem regarding work arise.
4. Make sure your vendor company has all the resources in terms of manpower, technology, finances, and infrastructure to ensure your company quality work.  Having all these qualities will help your outsourcing company to carry on their operation on smoothly on day to day basis and that shall also send you a sigh of relief that your non-core functions are being taken care of in the right hands.

All in all, make it sure that while finding your outsourcing company, you keep this checklist handy and implement on the points mentioned, for these cautions only shall provide your company a great opportunity for growth and help not only flourish but also guarantee you a sustained growth.

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