As a student, you were invited by
the Dean of
the Institute of Computing to attend a seminar-workshop
on information
systems planning with some of the faculty members. In one of the
sessions, a discussion of outsourcing came up. You have been asked to
present your evaluation about outsourcing the information systems
functions of the school.
Required
You are to take a position- outsource or in-source and justify your position.
(3000words)
If I were asked to present my evaluation about outsourcing the information
system functions of the school.The first thing to do is to analyze the problem
,I should know what is the function of information systems of the school and
what is outsourcing and why should be implemented or should used by the
school.Lets define Outsourcing
Outsourcing
a processthat signs a contract to perform part or all of the obligations of
another's contract.a process, such as product design
or manufacturing,
to a third-partyThe
decision to outsource is often made in the interest of lowering
cost or making better use of time and energy costs,redirecting
or conserving energy directed at the competenciesof
a particular business,
or to make more efficientuse
of land, labor,capital,(information)
technology
and resources[citationneeded].
Outsourcing became part of the business lexicon during the 1980s. It
is essentially a division of labour.Out sourcing in the information
technology field has
two meanings One is to commission the development of an
application to another organization, usually a company that
specializes in the development of this type of application. The other
is to hire the services of another company to manage all or parts of
the services that otherwise would be rendered by an IT unit of the
organization. The latter concept might not include development of new
applications.
BENEFITS
Costsavings. The lowering of the overall cost of the service to the
business. This will involve reducing the scope, defining quality
levels, re-pricing, re-negotiation, cost re-structuring. Access to
lower cost economies through offshoring called "labor
arbitrage" generated by the wage gap between industrialized and
developing nations.
the Dean of
the Institute of Computing to attend a seminar-workshop
on information
systems planning with some of the faculty members. In one of the
sessions, a discussion of outsourcing came up. You have been asked to
present your evaluation about outsourcing the information systems
functions of the school.
Required
You are to take a position- outsource or in-source and justify your position.
(3000words)
If I were asked to present my evaluation about outsourcing the information
system functions of the school.The first thing to do is to analyze the problem
,I should know what is the function of information systems of the school and
what is outsourcing and why should be implemented or should used by the
school.Lets define Outsourcing
Outsourcing
a processthat signs a contract to perform part or all of the obligations of
another's contract.a process, such as product design
or manufacturing,
to a third-partyThe
decision to outsource is often made in the interest of lowering
cost or making better use of time and energy costs,redirecting
or conserving energy directed at the competenciesof
a particular business,
or to make more efficientuse
of land, labor,capital,(information)
technology
and resources[citationneeded].
Outsourcing became part of the business lexicon during the 1980s. It
is essentially a division of labour.Out sourcing in the information
technology field has
two meanings One is to commission the development of an
application to another organization, usually a company that
specializes in the development of this type of application. The other
is to hire the services of another company to manage all or parts of
the services that otherwise would be rendered by an IT unit of the
organization. The latter concept might not include development of new
applications.
BENEFITS
Costsavings. The lowering of the overall cost of the service to the
business. This will involve reducing the scope, defining quality
levels, re-pricing, re-negotiation, cost re-structuring. Access to
lower cost economies through offshoring called "labor
arbitrage" generated by the wage gap between industrialized and
developing nations.
Focuson Core Business. Resources (for example investment, people,
infrastructure) are focused on developing the core business. For
example often organizations outsource their IT support to
specilaised IT services companies.
example often organizations outsource their IT support to
specilaised IT services companies.
Costrestructuring.
Operating
leverage is a measure that compares fixed costs to variable
costs. Outsourcing changes the balance of this ratio by offering a
move from fixed to variable cost and also by making variable costs
more predictable.
Improve [b]quality[/b]. Achieve a step change in quality through contracting
out the service with a new service level agreement.
Knowledge.
Access to intellectual property and wider experience and knowledge.
Contract.
Services will be provided to a legally binding contract with
financial penalties and legal redress. This is not the case with
internal services.
Operational
expertise. Access to
operational best practice that would be too
difficult or time consuming to develop in-house.
Access
to talent. Access to a
larger talent pool and a sustainable
source of skills, in particular in science and engineering.
Capacity [b]management[/b]. An improved method of capacity management of
services and technology where the risk in providing the excess
capacity is borne by the supplier.
Catalyst for change.
An organization can use an outsourcing agreement as a catalyst for
major step change that can not be achieved alone. The outsourcer
becomes a Change
agent in the process.
Enhance capacity for innovation. Companies increasingly use external
knowledge service providers to supplement limited in-house capacity
for product innovation.
Reduce time to market. The acceleration of the development or
production of a product through the additional capability brought by
the supplier.
Commodification.
The trend of standardizing business processes, IT Services and
application services enabling businesses to intelligently buy at the
right price. Allows a wide range of businesses access to services
previously only available to large corporations.
Riskmanagement.
An approach to risk management for some types of risks is to partner with
an
outsourcer who is better able to provide the mitigation
VentureCapital.
Some countries match government funds venture capital with private venture
capital for startups that start businesses in their country
Tax Benefit. Countries offer tax incentives to move manufacturingoperations to counter high corporate taxes within another country.
QualityRisks
Qualityfade is the deliberate and secretive reduction in
the quality of
labor in order to widen profit margins. The downward changes in
human capital are subtle but progressive, and usually unnoticeable
by the out sourcer/customer. The initial interview meets
requirements, however, with subsequent support, more and more of the
support team are replaced with novice or less experienced workers.
India IT shops will continue to reduce the quality of human capital
under the pressure of drying up labor supply and upward trend of
salary, pushing the quality limits. Such practices are hard to
detect, as customers may just simply give up seeking help from the
help desk. However, the overall customer satisfaction will be
reduced greatly over time Unless the company constantly conducts
customer satisfaction surveys, they may eventually be caught in a
surprise of customer churn, and when they find out the root cause,
it could be too late. In such cases, it can be hard to dispute the
legal contract with the India
outsourcing company, as their staff
are now trained in the process and the original staff made
redundant. In the end, the company that outsources is worse off than
before it outsourced its workforce to India
Public
opinion
Negative Effect
There
is a strong public opinion regarding outsourcing (especially when
combined with
offshoring)that
outsourcing damages a local labor market. Outsourcing is the
transfer of the delivery of services which affects both jobs and
individuals. It is difficult to dispute that outsourcing has a
detrimental effect on individuals who face job disruption and
employment insecurity; however, its supporters believe that
outsourcing should bring down prices, providing greater economic
benefit to all. There are legal protections in the European
UnionTransferof Undertakings (Protection of Employment). Labor
laws in the
United
States are not as protective as those in the European Union. On June 26
2009, Jeff Immelt, the CEO of General Electric, called for the
United States to increase
its manufacturing base employment to 20%
of the workforce commenting that the U.S. has outsourced too much
and can no longer rely on consumer spending to drive demand.
Insourcing
Insourcing is the opposite of outsourcing; that is
insourcing (or contracting in) is often defined as the delegation of operations
or jobs from production within a business to an internal (but 'stand-alone')
entity that specializes in that operation. Insourcing is a business decision
that is often made to maintain control of critical production or competencies.
An alternate use of the term implies transferring jobs to within the country
where the term is used, either by hiring local subcontractors or building a
facility.
Insourcing is loosely referred in call centers who are doing
the work of the outsourcing companies. Companies that outsource include Dell,
Hewlett Packard, Symantec, and Linksys. The callcenters and technicians that
are contracted to handle the outsourced work are usually over-seas. Customers
may refer to these countries as "India" technical support if
they are hard to understand over telecommunications. These insourcing companies
were a great way to save money for the outsourcing of work, but quality varies,
and poor performance has sometimes harmed the reputations of companies who
provide 24/7 customer/technical support.
MY JUSTIFICATION
For me if I given a chance to justify my position to
information systems functions of the school. I would probably choose d
outsource simply because this institute is a university not a business so
we should find a outsource
to study the needs of the school.The university should not used the faculty to
analyzed or do things that is not necessary for them to do. As I observed like
faculty in the institute of computing ,many faculty members were the one who
instantiate the information system that made the faculty overloaded but then d
same salary they get.
As we have understand outsourcing .It means looking for
people outside the firms. These would help for the firm not to used there human
resource to do task that they are not into.
So I hope the university could analyze these things for the
teacher can focus there self to the student, for us endure knowledge as we
grow.
Visit my blog:
http://gleizelle@blogger.com
Reference:
http://en.wikipedia.org/wiki/Insource
http://en.wikipedia.org/wiki/Outsourcing
leverage is a measure that compares fixed costs to variable
costs. Outsourcing changes the balance of this ratio by offering a
move from fixed to variable cost and also by making variable costs
more predictable.
Improve [b]quality[/b]. Achieve a step change in quality through contracting
out the service with a new service level agreement.
Knowledge.
Access to intellectual property and wider experience and knowledge.
Contract.
Services will be provided to a legally binding contract with
financial penalties and legal redress. This is not the case with
internal services.
Operational
expertise. Access to
operational best practice that would be too
difficult or time consuming to develop in-house.
Access
to talent. Access to a
larger talent pool and a sustainable
source of skills, in particular in science and engineering.
Capacity [b]management[/b]. An improved method of capacity management of
services and technology where the risk in providing the excess
capacity is borne by the supplier.
Catalyst for change.
An organization can use an outsourcing agreement as a catalyst for
major step change that can not be achieved alone. The outsourcer
becomes a Change
agent in the process.
Enhance capacity for innovation. Companies increasingly use external
knowledge service providers to supplement limited in-house capacity
for product innovation.
Reduce time to market. The acceleration of the development or
production of a product through the additional capability brought by
the supplier.
Commodification.
The trend of standardizing business processes, IT Services and
application services enabling businesses to intelligently buy at the
right price. Allows a wide range of businesses access to services
previously only available to large corporations.
Riskmanagement.
An approach to risk management for some types of risks is to partner with
an
outsourcer who is better able to provide the mitigation
VentureCapital.
Some countries match government funds venture capital with private venture
capital for startups that start businesses in their country
Tax Benefit. Countries offer tax incentives to move manufacturingoperations to counter high corporate taxes within another country.
QualityRisks
Qualityfade is the deliberate and secretive reduction in
the quality of
labor in order to widen profit margins. The downward changes in
human capital are subtle but progressive, and usually unnoticeable
by the out sourcer/customer. The initial interview meets
requirements, however, with subsequent support, more and more of the
support team are replaced with novice or less experienced workers.
India IT shops will continue to reduce the quality of human capital
under the pressure of drying up labor supply and upward trend of
salary, pushing the quality limits. Such practices are hard to
detect, as customers may just simply give up seeking help from the
help desk. However, the overall customer satisfaction will be
reduced greatly over time Unless the company constantly conducts
customer satisfaction surveys, they may eventually be caught in a
surprise of customer churn, and when they find out the root cause,
it could be too late. In such cases, it can be hard to dispute the
legal contract with the India
outsourcing company, as their staff
are now trained in the process and the original staff made
redundant. In the end, the company that outsources is worse off than
before it outsourced its workforce to India
Public
opinion
Negative Effect
There
is a strong public opinion regarding outsourcing (especially when
combined with
offshoring)that
outsourcing damages a local labor market. Outsourcing is the
transfer of the delivery of services which affects both jobs and
individuals. It is difficult to dispute that outsourcing has a
detrimental effect on individuals who face job disruption and
employment insecurity; however, its supporters believe that
outsourcing should bring down prices, providing greater economic
benefit to all. There are legal protections in the European
UnionTransferof Undertakings (Protection of Employment). Labor
laws in the
United
States are not as protective as those in the European Union. On June 26
2009, Jeff Immelt, the CEO of General Electric, called for the
United States to increase
its manufacturing base employment to 20%
of the workforce commenting that the U.S. has outsourced too much
and can no longer rely on consumer spending to drive demand.
Insourcing
Insourcing is the opposite of outsourcing; that is
insourcing (or contracting in) is often defined as the delegation of operations
or jobs from production within a business to an internal (but 'stand-alone')
entity that specializes in that operation. Insourcing is a business decision
that is often made to maintain control of critical production or competencies.
An alternate use of the term implies transferring jobs to within the country
where the term is used, either by hiring local subcontractors or building a
facility.
Insourcing is loosely referred in call centers who are doing
the work of the outsourcing companies. Companies that outsource include Dell,
Hewlett Packard, Symantec, and Linksys. The callcenters and technicians that
are contracted to handle the outsourced work are usually over-seas. Customers
may refer to these countries as "India" technical support if
they are hard to understand over telecommunications. These insourcing companies
were a great way to save money for the outsourcing of work, but quality varies,
and poor performance has sometimes harmed the reputations of companies who
provide 24/7 customer/technical support.
MY JUSTIFICATION
For me if I given a chance to justify my position to
information systems functions of the school. I would probably choose d
outsource simply because this institute is a university not a business so
we should find a outsource
to study the needs of the school.The university should not used the faculty to
analyzed or do things that is not necessary for them to do. As I observed like
faculty in the institute of computing ,many faculty members were the one who
instantiate the information system that made the faculty overloaded but then d
same salary they get.
As we have understand outsourcing .It means looking for
people outside the firms. These would help for the firm not to used there human
resource to do task that they are not into.
So I hope the university could analyze these things for the
teacher can focus there self to the student, for us endure knowledge as we
grow.
Visit my blog:
http://gleizelle@blogger.com
Reference:
http://en.wikipedia.org/wiki/Insource
http://en.wikipedia.org/wiki/Outsourcing
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