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Thread: What Is The Future of Outsourcing?

  1. #11
    Diamond Member Corzhens's Avatar
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    Default Re: What Is The Future of Outsourcing?

    Quote Originally Posted by Vampa View Post
    I expect that companies will be outsourcing more in order to cut costs. I believe though if outsourcing will be cutting into the taxes government collect, they may have companies which outsource pay more taxes thus canceling the savings they'd make. So while outsourcing will be around for a while when people start losing their jobs because of it, there has to be a change unless companies want to relocate overseas.
    In the long run, it is more expensive to outsource since the salaries are premium. However, companies tend to resort to outsourcing in order to avoid the hassle of giving free training to the newly hired. Besides, when there is an issue with an outsourced worker, they can easily ask for a replacement, as simple as that. It is like hiring a worker with a guarantee that it will perform good otherwise it would be like a product that would be requested for a refund (or replacement). And for overseas factories, particularly in poor countries, the cost of salaries are way too low compared to the local workers. In effect, the amount of savings in terms of salaries is substantial to maintain an office abroad.

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  3. #12
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    Default Re: What Is The Future of Outsourcing?

    Quote Originally Posted by gracer View Post
    Outsourcing is still increasingly being utilized by big companies especially from rich countries into poorer countries where salaries and cost of operation is far lesser than running them in their own country. The Philippines is one of the recipients of outsourced work and it is also one of the major source of income of residents here nowadays. I think it's an advantage both on the businesses outsourcing some of their work and on the countries or areas receiving the work.

    What do you think is the future of outsourcing? How do you see it in 5 or 10 years?

    I personally believe we're exciting that era, and that outsourcing has a rather grim future. This is a natural pattern, as industry evolves processes improve and we get more efficient at doing the same task, which means: more automation, less need for human intervention/labour hands.

    Even support call centres will get less work as the processes improves and there is less need for troubleshooting and/or the business process is more efficient and automated so the client doesn't have to call just to, say, change his address.

    Industry wise, the outsourcing mainly happened with laborious industry with low levels of automation (such as garment/textile). Even this in the long run is on the wane, because research is happening right now to create robots capable of handling flexible objects. And I believe it is only a matter of time before such robots become a reality and tons of jobs in Textile/food processing/wire assembly will simply be flushed.

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  5. #13
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    Default Re: What Is The Future of Outsourcing?

    In the trend of outsourcing the smaller companies which are reluctant to outsource would get thrashed because of higher labour cost.

    We are already seeing a huge shift in the strategy of bigger companies who can create their own office in third world countries, pulling out of contracts to outsourcing companies and setting up their own office in those countries.

    So in the future the only clients the outsourcing companies would have would be the ones for whom it does not make economic sense to open their office in that country.

    The outsourcing industry also is gearing up for the same.

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    Default Re: What Is The Future of Outsourcing?

    Quote Originally Posted by Dropshipping View Post
    In the trend of outsourcing the smaller companies which are reluctant to outsource would get thrashed because of higher labour cost.

    We are already seeing a huge shift in the strategy of bigger companies who can create their own office in third world countries, pulling out of contracts to outsourcing companies and setting up their own office in those countries.

    So in the future the only clients the outsourcing companies would have would be the ones for whom it does not make economic sense to open their office in that country.

    The outsourcing industry also is gearing up for the same.
    I've been seeing this a lot in my country lately. More and more companies from high economic countries are now opening businesses here in my country and I do think this will still be increasing soon. Even Trump has opened his business here which has been called the "Trump Tower". Paris Hilton also opened a real estate business way ahead of Trump which has been called the "Paris Beach Club".

  7. #15
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    Default Re: What Is The Future of Outsourcing?

    Quote Originally Posted by gracer View Post
    Outsourcing is still increasingly being utilized by big companies especially from rich countries into poorer countries where salaries and cost of operation is far lesser than running them in their own country. The Philippines is one of the recipients of outsourced work and it is also one of the major source of income of residents here nowadays. I think it's an advantage both on the businesses outsourcing some of their work and on the countries or areas receiving the work.

    What do you think is the future of outsourcing? How do you see it in 5 or 10 years?
    Let's not confuse the term Outsourcing with Offshoring.

    Outsourcing in Supply Chain and Logistics generally just means 'contracting out' to a third party. Hence the term 3PL, Third Party Logistics.
    Regards

    Top Link - Site Founder

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  9. #16
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    Default Re: What Is The Future of Outsourcing?

    Even though personally I do not advocate outsourcing, I think it's going to flourish well in future. As already pointed out nowadays the main target of outsourcing firms is "third world countries" where they can get manpower at the lowest possible cost . So they are able to reduce cost of operation and also they don't have any statutory liability on these workers.

    But at the same time the quality of service is badly hit by over outsourcing. I think in almost all companies most of the customer care operations are now outsourced. When we contact a customer care executive he/she may not be aware of the local issues exist in that location as he/she belongs to another country. This may lead to low customer satisfaction but it won't matter as all companies goes through the same way of operations. Finally the customer is left with no other option but to use the same service.

  10. #17
    Silver Member Alexandoy's Avatar
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    Default Re: What Is The Future of Outsourcing?

    Our country is phasing out the contractual scheme of employment. As an effect, companies have turned to outsourcing to avoid legal complications. Therefore it is a clear indication that the outsourcing industry is thriving and will continue to progess because of the hiring going on. Outsourcing by international companies is a big industry and now local outsourcing is following the act which means the outsourcing industry is getting bigger.

  11. #18
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    Default Re: What Is The Future of Outsourcing?

    Outsourcing will exist as long as there is a need for corporations/businesses to drive the bottom line. The concept of outsourcing is to provide a basis for comparison/assessment against our status quo. It does not matter whether this basis comes from a foreign country or in your own country. Increasing competitiveness will drive corporations/businesses of the future to source for alternatives to meet their bottom line targets.
    This phenomenon is also showing in the lifestyle of younger generations whom no longer desire to work under employment, and would rather work as private contractors. Developments in electronic communication platforms via the internet have increased the ability of businesses and contractors to communicate needs and solution providing. These factors would contribute to the growth of the concept of outsourcing at all levels in the face of competition in the future.

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    Default Re: What Is The Future of Outsourcing?

    Outsourcing has become an essential element of most of the companies. It has become a key business strategy for both small and large business enterprises who believe in devoting 100% to their key business operations and outsourcing the rest to specialized vendors.Global companies who wanted to leverage the cost benefits of outsourcing started outsourcing high-end functions. Manufacturing and Pharmaceutical businesses will move to cheaper destinations, such as India to take the advantage of low labor and operating costs.

  13. #20
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    Default Re: What Is The Future of Outsourcing?

    I have been experiencing great success with outsourcing with the current project that I have been working on. We saw the cost effectiveness of outsourcing compared to our own operations and outsourcing saved 50% cost efficiency for the same results, in 2 different areas of operations.

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