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Advantages and Disadvantages of Outsourcing

The popularity of the term outsourcing has increased in America. Outsourcing is not limited to manufacturing since it is possible to get customer support from people in other states. However, popularity does not mean you should always go for outsourcing. Outsourcing has its cons and pros as explained in this article.

Outsourcing is helpful since it helps one to cut labor costs. One of the major factors that influence the amount you pay for this product is the much labor costs. Prices at which companies do offer their products are determined by the much its labor costs. America has a higher cost of living, making factories to spend a lot in wages. However, India and Chinas cost of living is lower and you can pay employees less and meet their needs. This makes the cost at which factories manufacture to be low, enabling them to sell their products at prices that are competitive.

It is helpful to outsource because it avails more hours. While there are 40 working hours a week for the Americans, time is not a concern when technical issues are concerned. In case a company has an interest in offering customer support in-house; employees have to remain active the entire day a whole week as suggested on this website. Employees working at midnight might develop issues like irritability, insomnia, difficulty with personal relationships, insufficient sleep, lack of energy, and difficulty in concentrating. However, if someone in India answers customer service at midnight, it is day time for them. As a matter of fact, some IT companies subcontract services to all time zones to maximize the time they offer services.

It is disadvantageous to subcontract because you are not able to control quality. When everything is performed in-house, walking around can help you to do a quality check. When you outsource from another company, you will not find it hard to control quality. Therefore, issues can be taking place for weeks only for you to notice them as customers complain or you decide to fly overseas to see the progress.

It is not advisable to outsource as this lowers employee morale. Company morale is at stake when workers feel they are not secure with their jobs. Upon starting to outsource different services overseas, the remaining employees begin to feel insecure. They tense and begin to search for greener pastures.

Outsourcing is disadvantaged by cultural barriers. Value systems differ slightly in different parts of the world and what is acceptable in a region may be a taboo to another. In case you outsource a company whose cultural values vary from your companys, they will have business priorities that differ, thus causing chaos. A language barrier also brings about frustrations among clients and service providers.