The Importance Of Global Outsourcing

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All thing surround us growing rapidly, this in include International Business competition. Thus enterprises must always remain ahead of the competition to ensure their survival. Therefore , the company need to alert with the rapid changes, be innovative, adapt with new technologies, techniques and also new systems. Company need to move faster with revaluate and redirect missing resources because of the global competition intense. Engage in global outsourcing activities are method to compete in the international business Furthermore, outsourcing plays a main role for enterprises because the cost of raw materials is important part of the cost of final product. So that, the organization need to choose the right supplier to reduces the cost…show more content…
Outsourcing to others what they do more efficiently is successful management strategy. Global outsourcing is not a new phenomenon, it have been performed for centuries as a part of trade between nations and company to make profit for essential product and service though third party. Nowadays, global outsourcing has been claimed as one of the major drivers for the globalization of production. Global outsourcing was developed in 1950s has had remarkable influences on international business as well as on global market places (Burkholder, 2006). Global outsourcing provide huge impact on world politics and economic environment. This dramatic changes also cause in being the controversial influence in the world economies. All this can be do it through the development and advancement in technology which is not only eliminating the borders but also bringing the closer to each other. Though global outsourcing it give opportunities to company provide more jobs in overseas in order to be proved as cost cutting for company. This mean that , global outsourcing has positive effect on both side between provider and clients. Global outsourcing has been spread in many countries, particular in Asian countries in this science and technology advanced…show more content…
There must be provide benefits to the company that make certain company decide to outsourcing. There have a few reason why company choose to engage in outsourcing and how global outsourcing benefits the company. The main reason for company to outsourcing is to save cost. Organization realize that cost can be cut down by doing outsourcing activities. Global suppliers are highly specialized in their own business, which allowing them to produce the product at lower costs rather than outsourcing firm. Therefore, a firm can improve production cost level by outsourcing non-core activities (Kotebe. M et al, 2007 cited Hendry, 1995 and Quinn, 1999). Furthermore, outsourcing of products and processes can result in the decision not to buy new technology due to all technology will cover by third part in global outsourcing activities. Therefore, it proved that global outsourcing give benefits to the companies which is it help reduce the overall of cost. This cost may include labour cost, capital and also restructuring cost. The manufacturing process can be done at lower cost and also provide a better quality. For example, if the company outsource their work to India, the job can be done at a lower cost due to India provide lower cost in labour cost. The wage of workers much lower than U.S and Europe. It not just India who are willing to work for less. In fact, companies

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