Outsourcing Research Paper

Submitted By thehawkmaster1
Words: 706
Pages: 3

Jacob Drenth
Per. 3
I. Thesis Statement: There are numerous advantages of outsourcing; such as companies can focus on their core works, reduce their production costs, and save time to increase productivity.
II. Large corporations outsource many of the components of their products from external suppliers.
A. Sun Microsystems used a form of outsourcing so that they were able to expand their company and prosper in a free enterprise system. (Andrea 23)
1. In 2000 Sun Microsystems had a bubble burst Sales in Sun's important hardware division went into free-fall as customer’s closed shop and auctioned off high-end servers. (Jones 45)
2. Several quarters of steep losses led to executive departures, rounds of layoffs, and other cost cutting. In December 2001, the stock fell to the 1998, pre-bubble level of about $100.(Jones 46)
B. North American made Automobiles have even imported parts from other countries regardless of its authenticity
1. Some American made cars have even been manufactured in other countries because of the profit margin for the company is much greater if they are made in different countries. (Moad 2)
2. American made automobiles have given rise to new forms of outsourced goods that claim to be American made. Most of an American car parts are manufactured in different countries so that when it is assembled in America it’s much more sot effective to do so. (Moad 2)
III. A special keen interest in a company’s core works is the first advantage of outsourcing.
A. The focus and specialization of outsourcing is a key factor in a company’s success in a growing mature economy.
1. Specialization or the theory of costs the main reason for the continued relevance of outsourcing. This is the reason why outsourcing works best for the service industry-where there is no physical product that needs relocating.(Hilgendorf 10)
2. As costs of outsourcing rise in growing and maturing economies like India the venue may change , but outsourcing will always happen for there will always be regions which will perform certain functions at an advantageous cost to the outsourcer. (Coghlin 14)
B. Better production can be the result of outsourcing companies and can provide more jobs for hard working people.
1. Having better production can have financial benefits; it can clean up your balance sheets by eliminating assets, and have a more stable cash flow.(Hilgendorf 46)
2. Outsourcing can also provide Market discipline, alongside the production quality someone can align ones cost with the suppliers in the field. (Marom 67)
3. Outsourcing production to other countries such as china might introduce a revolutionary technology that might benefit the company if it fits the criteria of the capital good. (Marom 69)
4. Outsourcing might help the flexibility