Is Outsourcing Positive? :: Globalization, Technology, Businesses, Financial

Is Outsourcing Positive??? Outsourcing- out†¢sourc†¢ing (out sà ´r s ng, -s r -) n.: <business> Paying another company to provide services which a company might otherwise have employed its own staff to perform, e.g. software development(dictionary.com) Outsourcing is becoming a common occurrence for industries in the United States. In order to save money, time, and employees, companies are hiring outside businesses to conduct operations for them, especially in the technology field. Many companies are choosing to use outsourcing. For example, government agencies are outsourcing. â€Å"Offshoring is going on to some degree in just about every State Government. At least 18 firms that specialize in offshore outsourcing are positioning themselves in no fewer than 30 States to capture a large share of the State Government market, especially in IT services," said the study, titled `Your Tax Dollars at Work... Offshore: How foreign outsourcing firms are capturing State Government Contracts'.† (sify.com) Unfortunately, most state governments do not even realize they are offshoring. Many governments subcontract work and never bother to find out where the work is actually being done. They assume that, because the company has a US office that the work is done in the US. However, there are several companies that simply have an office in that state but actually are owned by a parent company in another country. â€Å"As subcontracting is common, States are ofte n unaware of the exact identity and location of the company that ultimately performs the work.† (sify.com) Companies are outsourcing for several reasons. Mainly, it can save a company a lot of money. If a business can outsource to another company, locally or internationally, and get a job done cheaper than if they did it in house, why would they not? Information technology is one of the most common outsourced areas. This can be for several reasons. It is extremely expensive and time consuming to set up one’s own IT department. A company may also not have the resources and people to run such a department (cica.ca) â€Å"Outsourcing is also a common option for minimizing start-up times and avoiding the high costs of entering new markets† (cica.ca) Next, outsourcing can by used for efficiency. The outsourced IT company will be better versed in what technology would fit a particular business. Outsourcing often provides access to advanced technology that can result in distinct technical leadership.