As we began to learn about outsourcing, its impact and the way it is perceived by society and the information technology industry, we come across some issues that seem to define outsourcing. Some of the problems are positive about outsourcing and some are negative. One negative issue is identified as a problem statement for this istraživanje.Outsourcing industry in the United States was the target of political ideologues and a fair amount of fear. In this experiment we will try to explain the social and political environment that affects outsourcing. Also, many American companies have suffered losses to outsourcing, because the infrastructure in the host is not up to standard. We will try to address that question too.
History of outsourcing
History of outsourcing
...In our study we focused on information technology (IT) outsourcing. IT outsourcing has gained momentum after the internet began gathering every corner of the world, and globalization collapsed national barriers. Today, U.S. companies such as Intel and Sun Microsystems have higher research and development outside the United States within a nation, a Citibank card processing external to India, and customer support at Dell is coming from the Philippines.
Some view outsourcing as a way in which developing countries can have access to the new technology enjoyed by industrialized countries and the path towards economic and social empowerment.
relevant research on outsourcing
relevant research on outsourcing
...However, it must be said here that we found a lack of theoretical research on outsourcing.Baza knowledge of the industry does not focus on theoretical research, but the financial data and global economic and political trends. What we noticed is that the IT industry is looking at outsourcing as an economic phenomenon, rather than focusing on research in a way that is applied to software, microprocessors, Internet, etc.
Why is outsourcing an important issue? Referring to our problem statement, we would like to emphasize that the problem is significant not only because of its impact on the IT outsourcing industry, but also because of the global economy as a whole. We know that outsourcing is a $ 400 billion a year industry and IT outsourcing is a vital part industrije.Kriza in IT outsourcing means a loss for the global economy.
of the problems facing outsourcing (such as political pressure in the U.S. and the lack of infrastructure in developing countries, computers) can severely retard the growth of IT outsourcing, the problem facing this industry is significant.
Finally, we would like to state that nothing should be assessed in a void. If we judge outsourcing by itself could not say whether it is good for society or not, but if you've seen outsourcing from the perspective of the world economy, increasing globalization, the rise of production costs in the U.S., and lower costs in developing countries, we can see that outsourcing is a positive side too. Although less than 20% of the total American software companies outsource their work, generally offshore outsourcing ("offshoring") is seen as something bad for America. We hope that with this work will be able to present a balanced picture of outsourcing.
within the outsourcing debate: How DuPont benefit from outsourcing to China
When we started looking at the debate about outsourcing, we came across DuPont, who outsourced their project to create a database on-line materials in China. In a report published in Asia, outsourcing website, said that outsourcing to China, the company is able to create a 24 / 7 operation and complete the project before schedule. The report also points out why the company has chosen China as their destination, and also talks about the future of China as an outsourcing destination. (Rosenthal, 2005, p.6)
How the U.S. Government can benefit from outsourcing
Looking at the example of DuPont, where outsourcing has helped the company to complete the project on time and save costs, we decided to look at how outsourcing can help the government. We have come across reports about the U.S. government IT challenges and how outsourcing can be helpful in Asia, outsourcing sites. The report states that, in the year 2005, 50 percent of the federal government's 70,000 IT workers will become eligible for retirement, according to the 1999 study. Also, the Government IT legacy systems are aged. So even if young people join the workforce are trained in the old system. They must be trained, which means increased costs and costs for the government. This gap has opened doors to suppliers to offer outsourcing as a solution to the problem. (Harney, 2005, p.2) The report mentioned that many unions and government workers against outsourcing because they fear it will raise unemployment in the United States. Although the general fear of outsourcing to the public, we believe that if we are able to create a mutually beneficial outsourcing relationship between the two parties and show people the benefits, they will begin to feel positive about it.
Creating a mutually beneficial outsourcing relationship
a report titled "Creating Win-Win Culture" in outsourcing your talking about QinetiQ, which was reaching the end of an existing outsourcing contract and understand the need for a single source solution to provide a wide range of services and also reduce overall costs for IT services. In 2003, the company signed a contract with Accenture to provide a wide range of applications, hardware and service provider data centers, as well as acquisition and program management. To achieve early savings, the two companies bought the structure and effective management of the establishment of good relations at all levels in both organizations. They were able to exceed the savings target in the first year of their partnership through open communication, continuous innovation and the win-win solutions based. Looking at the example of QinetiQ and Accenture, we can say that a good outsourcing relationship can create a win-win culture, which can be used on both sides. More and more companies trying to copy the success of these two companies. (Garner, 2005, pp.4)
After talking about the positive aspects of outsourcing, the benefits it can offer business and government, now turn to discuss the negative side of outsourcing in fact decline in satisfaction among customers outsourcing, security risks, societal impacts and public opposition. Declining satisfaction among outsourcing clients report declining satisfaction among outsourcing clients published on ZDNet talks about Diamond Cluster International study, which found that the number of satisfied customers out of their offshoring providers fell from 79% to 62%. Also number of offshoring their customer termination of the contract early has doubled and reached 51%. (Frauenheim, 2005, p.2)
the security risks of outsourcing
This reduction in the rate of satisfaction will not help the recent reports of security breaches at call centers in India. It was reported on the BBC for Zubair Ahmed that some employees of Mphasis India's call center in Pune transfer large sums of money for a fake account created from the accounts of U.S. Citibank customers, whose call operations are handled by the company. This incident brought into focus the lack of an integrated safety management system in India call centara.Industrija is still at the stage of growth, not much attention is paid to ensure that proper safety procedures followed. It is only after this incident that the company started doing background checks on employees and have made verification of standards in the hiring process. This incident raises many questions regarding safety and security of data during the process are outsourced, and the ability of Indian companies for data processing is certainly in question. (Ahmed, 2005, p.2)
social effects of outsourcing
while the data security in outsourcing is the issue, no question about the social effects of outsourcing too. This question has largely been marginalized, because the industry is mainly engaged in the more visible effects of outsourcing as a cost reduction and profit, rather than seek a slow but steady social change in outsourcing is the cause. Kaushik Basu talks about this issue in his article, "Politics Business Outsourcing," published on the website of Project Syndicate. In his article he says that the loss of jobs due to outsourcing can lead to protectionism and nativism. In the long run this can lead to racism and other discrimination. So it is very important to help laid-off workers, so they do not develop this kind of feeling towards the country where his job was gone. (Basu, 2004, p.9)
Unions opponent outsourcing IT
Unions in America have looked to one side of the social effects of outsourcing - job loss and the effect it has on family and society. They are protesting against outsourcing and pushing the government to legislate to ban outsourcing. In his report, "Unions step up anti-outsourcing efforts," Juan Carlos Perez says that information technology trade unions are struggling to make American jobs in America. Leading this fight is the International Federation of Professional and Technical Engineers (IFPTE), who tries to convince the United States Congress to enact legislation that will protect jobs from being outsourced. The Union is also lobbying hard to get a working visa, a special H1B regulations stricter, so that regardless of the jobs stay in America goes to the Americans. (Perez, 2005, p.4) While we are concerned that unions images outsourcing as the sole reason for the loss of jobs in the IT industry, while they turn a blind eye for other reasons such as stagnating industry, high costs and increasing competition of foreign-based companies . It would be better for industry and for IT professionals if they start seeing the whole picture, instead of targeting outsourcing as the only evil.
damage the IT talent pool in the U.S.
damage the IT talent pool in the U.S.
...Having discussed at length about issues such as outsourcing of security concerns, questions about job loss, covering the talent pool in America, and others, now move our discussion destination for outsourcing and IT infrastructure in these destinations. Outsourcing Destinations India and China have emerged as a leading destination for IT outsourcing business. For the analysis we did not study outside of China as an outsourcing destination.
Report "Country Analysis: China" talk about China as an outsourcing odredište.Ističe the report are summarized as follows: software outsourcing market in China was U.S. $ 1.5 billion market with annual growth rates of around 35% . the current position in China where India used before 12 godina.Rast in this sector has driven large amounts of low-cost and skilled workforce and a large internal market. Although the Chinese market is promising is suffering from some serious problems such as lack of English language among developers and managers of Chinese companies have established a quality control procedure as well as their Indian counterparts. Also a big piracy problem in China is to help you become a credible destination for development softvera.Kineska government is launching a program to encourage the development of software industry. But that does not have a good international image of the UN-democratic style of management and many European companies and U.S. companies are hesitant of doing business in China because of it.
Report "Country Analysis: China" talk about China as an outsourcing odredište.Ističe the report are summarized as follows: software outsourcing market in China was U.S. $ 1.5 billion market with annual growth rates of around 35% . the current position in China where India used before 12 godina.Rast in this sector has driven large amounts of low-cost and skilled workforce and a large internal market. Although the Chinese market is promising is suffering from some serious problems such as lack of English language among developers and managers of Chinese companies have established a quality control procedure as well as their Indian counterparts. Also a big piracy problem in China is to help you become a credible destination for development softvera.Kineska government is launching a program to encourage the development of software industry. But that does not have a good international image of the UN-democratic style of management and many European companies and U.S. companies are hesitant of doing business in China because of it.
...Although China has a huge supply of IT professionals, those skilled in software engineering, and software is very limited, because Chinese universities still emphasize the traditional engineering fields such as engineering and electrical engineering. Also, China has made great progress in telecommunications infrastructure, but the movement is concentrated in large cities and near coastal regije.Unutrašnjosti and rural areas are still far behind. This limits the Chinese market for software sales and development. We can see that China is a promising destination for IT outsourcing, but it has some problems previše.Zemlja trying to occupy the position of India in the outsourcing market, which may be able to, if we look at IT infrastructure and other environmental issues affecting the development of IT in the South Asian market.
...The Internet is the way to South Asia in the late 1980s to the bulletin boards, government and NGO initiatives. In India, in 1995 the state-owned VSNL started offering Internet access to the public. Private companies entered the market in 1998. In Nepal, it was introduced in 1993 and 1996 people are given access to the World Wide Web. Initially, only large cities in the region have access to the internet, but now using the Internet has spread to rural areas too. For example: In India, many villages' government agencies have set up their websites and offer many of its services online
.Although the Internet is expanding in South Asia, the lack of infrastructure, outdated legislation, language barriers and the high cost of Internet access they hinder growth. We can see that the South Asian IT infrastructure faced with problems, but the industry is trying to overcome and keep its position as a favorite destination for outsourcing. (Rao, Bhandari, Iqbal, Sinha and Siraj, 1999, p.7)
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