Quality and Reliability Management †Free Samples to Students

Question: Discuss about the Quality and Reliability Management. Answer: Introduction: The importance of outsourcing in business organizations operating in todays global world cannot be overstated. Outsourcing is defined as a strategic action of an organization whereby the outside resources are being utilized by a company for accomplishing its business activities that are otherwise handled by the internal staffs and resources of the company. Many companies have been able to benefit immensely by outsourcing their business activities. Companies such as Google, Unilever, Alibaba, Acer, and others have been able to boost their business growth by outsourcing their activities only (McIvor 2016). The organizational flexibility that a company can achieve is the most important advantage of outsourcing business, and yet there are potential drawbacks such as security threat as well. Many companies are recently outsourcing their business activities as it lets them work with global talents, and helps a company focus on the core functions of business. Considering the importance of o utsourcing of business operations, the paper intends to investigate and critically analyse the advantages as well as disadvantages of outsourcing business activities in the globalized world of today. In the era of globalizations, most of the companies believe in working in an integrated way, in order to simplify its job as well as to reduce the cost. The cost and quality conscious companies prefer to outsource most of the non-core business works to the Asian countries like India, Malaysia and Singapore to ensure that it can focus on the core functions like business administration. This is why, a large part of the business functions such as payroll, inventory management as well as transaction processing, are being outsourced the external vendors. While cost effectiveness, and wide access to skilled resources are indeed two important benefits a company can derive through this, there are many companies that have not been able to manage outsourcing in a proper way and have met with failure. Companies like J.P Morgan and IBM met with disastrous failure while outsourcing their business activities. Hence, in this connection, it is important to take note of the benefits as well as challe nges a company is likely to encounter if it intends to outsource its business activities (Gerbl et al. 2016). This research project will help in explaining why outsourcing has emerged to be a significant business strategy and how todays companies can create and sustain value by outsourcing their business activities. At the same time, it is important to assess and analyse how in case outsourcing plan is not executed and planned, a company can also meet with failure. Thus, the company will also enlighten on how some companies met with disastrous failure owing to the numerous and unforeseen challenges associated with outsourcing activities. The present project intends to critically analyse and examine the benefits as well as limitations of outsourcing in todays highly competitive world. Often certain business operations of a company are operationally uncontrollable, in such situations, outsourcing can largely help a company. Outsourcing also benefits a company by enhancing its productivity and adds to the organizational success. It is a well-known fact that when a company outsources its business needs to an outsourcing partner like Flatworld Solutions, the outsourcing partner can easily bring in years of vast experience in business practices and expertise that helps it deliver complex outsourcing projects.Hence, it is important to know how and in what way exactly outsourcing contributes to organizational success, in a company. This research project will also help in throwing light on the pre-requisites of successful outsourcing program such as vendor selection, relationship management, and clarity of organizational goal s and objectives. Thus, the research will help in ensuing that the companies in future can properly utilize outsourcing activities in business. Many companies spend much time, energy and money on outsourcing their business activities. Hence, it is imperative for them to stay aware of the risks associated with outsourcing as well. This research will help in creating awareness amongst the business managers about the possible risks such as loss of sensitive data, hidden cost and legal problems as well as loss of managerial control in business that can also impede future business growth as well. In a nutshell, the project intends to enlighten business organizations about the scope and limitations of outsourcing in business. Advantages of Outsourcing in Business: One of the most obvious advantages of outsourcing is the cost savings that outsourcing activities brings to an organization. There is no gain stating the fact that often a company will outsource its business functions to a third world country where there is cheap availability of labour. Consequently, often business organizations in the European countries outsource their works to South East Asian countries where the employees agree to serve the company at a much cheaper cost. In fact, research reports suggest that a company by outsourcing its business to India can save up to 60% of the total cost (Lacity and Willcocks 2017). Thus, this also adds to the competitive advantage of the company. The lower cost of operation and labour, and reduction in overhead costs makes it attractive to outsource. The reduction in the manpower cost is one of the most important reasons why an organization decides to outsource its business. There is no point stating the fact that IT is becoming ever more cr itical to conducting businesses today. In many cases, whether public or a private company, an organization more than often lacks the scale or technical buying power to get best in class IT all the time. In such situations, by simply outsourcing IT functions, a company can easily have a predictable budget (Vaidhyanathan et al. 2013). A chief advantage of outsourcing is that it enables an organization focus on the most important aspects of business that merit organizational attention. Often the companies end up investing so much time and energy in the non-core business activities, that the main core business activities start suffering. By outsourcing the less significant business activities to other companies, an organization can easily concentrate on brand building activities, conduct research and development programs that help the organization provide higher value added services. In fact, it is important to note that outsourcing has turned up to be a smart and economic leadership tactic for those the small and emerging business organizations (Schniederjans et al. 2015). Often these companies assign more than one job to an employee, that not only affects employee productivity but also employee motivation. This is why, outsourcing the basic business functions such as web development, copywriting, taxes and payroll as well as IT related works, an organization can easily focus on the core business processes rather than the supporting ones (Gerbl et al. 2015). It should be remembered that core competencies of a business determines its sustainability, and hence the core competencies should be strengthened within an organization and it is clearly evident that productive outsource can always simplify the workload of a company. Increased Efficiency in Business: Though it is a less acknowledged fact, it should be remembered that most of the times outsourcing results in nothing short of increased efficiency in business, and helps in raising the productivity level. An organization outsources its business to other vendors only when they possess the required technical expertise as well as specific equipments necessary for the smooth completion of the task. As a result, as and when a task is being allocated to an external party, the tasks are usually accomplished faster and with far better quality output (Jackson 2014). However, while outsourcing, it is important to ensure that the outsourcing partner is not a new and emerging one, but rather a reliable one such as Flatworld Solutions, that can deliver complex outsourcing projects with the help of their years of experience in business practices. One of the biggest challenges of recruiting and training existent workforce in order to develop and enhance the skills and expertise they otherwise do not possess. However, by outsourcing business to a third party, an organization does not need to hire or groom individuals in-house (Sun et al. 2014); hence the recruitment as well as the operational costs can be minimized to a considerable extent. This is one of the major advantages of offshore outsourcing that the work in which the existent employees lack expertise can be outsourced to other companies. A very important advantage of outsourcing business function is the time zone advantage. More than often the countries in the West outsource their business activities to the countries in the East. As a result, due to the difference in time resulting from difference in location, it is easily possible to get the job done while the outsourcing company is closed for the day so that it can easily wake up to the service being delivered the next morning. As a result, outsourcing helps in providing round-the-clock service to the company (Fogarty and Bell 2014). Disadvantages of Outsourcing in Business: Despite its multiple benefits, outsourcing offers an organization, it is one of the chief disadvantages of outsourcing is that it carries the risk of exposing confidential data to a third party. The threat to security and confidentiality is a major drawback of business process outsourcing. As and when a company decides to outsource its payroll, medical records or other vital HR documents to a third party organization, there is a moderate chance that the confidentiality of the outsourcing company will get compromised (Gummerus et al. 2016). This is the reason why companies are always better advised to choose the outsourcing partner with much discretion, as otherwise sharing of valuable company information such as proprietary data can prove to be highly detrimental to a company. Outsourcing business process can create potential difficulty for a business organization. This is because the moment an organization entrusts its duty and function of a specific department to another company, it is shifting the management and control of that department to another company as well. As a result, the outsourcing company may encounter difficulty in managing the offshore provider. The company will lose its power of determining how it will make profit in business, and its profit will be determined by how the outsourcing partner chooses to manage its business. Although while outsourcing business process to an external vendor, an organization will ask the outsourcing partner to sign a contract which will contain the terms of the agreement as well as the details of the expenses, some expenses may not be specified in the agreement. Anything that is not being specified in the contract such as legal fees for retaining a lawyer, travelling expenses or expenses involved in creating infrastructure for the smooth operation of the outsourced activities are difficult to be predicted beforehand (Caruth et al. 2013). Consequently, those companies which do not plan properly often encounter financial trouble. Lack of Quality Assurance: There is no gain stating the fact that in most of the cases, an outsourcing company is driven by profit, and hence cares not much about the quality of work being delivered. Once a contract is entered upon, the total price they can get for the accomplishment of the task will be fixed (Vaxevanou and Konstantopoulos 2015). As a result, these companies will try to reduce their expense while trying to increase the profit. This can lead to low quality service being delivered as the outsourcing partner will not prioritize any company and its profit, while handling too many companies at the same time. Conclusion: In the globalized era, the advent of advanced technology has simplified business conducting process for organizations. It has become easier for companies to choose an external service provider for the accomplishment of the tasks that it cannot otherwise cannot complete, owing to shortage of time and scarcity of skills and expertise. However, nevertheless, it is undeniable here that the security threats and risks, quality problem and hidden cost, as well as dependence on other company, are some of the potential weaknesses of business outsourcing process. Hence, it is recommended that when an organization decides to outsource its business activities, it must ensure the selection of right service provider and effective, periodical supervision of the outsourced business activity. Reference List: Caruth, D.L., Haden, S.S.P. and Caruth, G.D., 2013. Critical factors in human resource outsourcing.Journal of Management Research,13(3), p.1. Fogarty, D. and Bell, P.C., 2014. Should you outsource analytics?.MIT Sloan Management Review,55(2), p.41. Gerbl, M., Gerbl, M., McIvor, R., McIvor, R., Humphreys, P. and Humphreys, P., 2016. Making the business process outsourcing decision: why distance matters.International Journal of Operations Production Management,36(9), pp.1037-1064. Gerbl, M., McIvor, R., Loane, S. and Humphreys, P., 2015. A multi-theory approach to understanding the business process outsourcing decision.Journal of World Business,50(3), pp.505-518. Gummerus, A., Airaksinen, M., Bengtstrm, M. and Juppo, A., 2016. 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