Outsourcing is a double-edged sword. It can save a company time and money, but it can also lead to loss of control and quality. This article will explore the different outsourcing strategies and provide real-life examples of companies that have used them to achieve success by striking the right balance between cost savings and quality control.
🔝 Top 5 Outsourcing Strategy Example Papers
- Nike Incorporation Strategy Analysis
- Human Resource Management in Companies
- Outsourcing Information Technology in Companies
- Effects of Outsourcing on the US Economy
- Management: Outsourcing and Insourcing
🌐 Outsourcing Strategy: Definition
A company’s outsourcing strategy is a plan to hire third-party firms or individuals to complete tasks rather than relying solely on internal employees. This plan aims to lower costs, increase productivity, and improve the company’s overall prospects.
What Are the 4 Types of Outsourcing?
There are four types of outsourcing tactics, each with its own advantages and disadvantages:
Why Is Outsourcing Strategy Important?
Outsourcing strategy brings many benefits to a company. The main advantages are that it speeds up the development process, cuts costs, and, most importantly, allows companies to focus their resources on core competencies. It also creates strategic leverage against the company’s competitors.
What Are the Advantages and Disadvantages of Outsourcing?
✈️ How to Create an Outsourcing Strategy
Here are the essential steps to create a successful outsourcing strategy:
- Outlining extensive outsourcing goals
A company needs to define its outsourcing goals and ambitions early on. This way, it can stay one step ahead of the game. If a company outlines its outsourcing goals in precise detail, it will be in a better position to choose the suitable staff for their requirements. - Creating a budget for the unexpected as well as the expected
When calculating the quarterly, monthly, and annual budgets, it’s crucial to consider what the firm’s existing staff augmentation will need. However, it’s also necessary to plan and budget for the unexpected, which means keeping a certain amount of money for adjustments, emergencies, or any unforeseen cost turnover. - Mitigating any outsourcing risks
There are some risks involved that the company needs to be aware of. And when these risks are mitigated, it will automatically increase the efficiency of your work.
💡 Outsourcing Strategy Example Companies
Alibaba Outsourcing Strategy
When you talk about online vendors, a few come to mind: eBay, Amazon, and Alibaba. While Alibaba does take advantage of outsourcing, its strategy is a bit different. As they are based in China, they used outsources from the US in their early days instead of waiting around.
Google Outsourcing Strategy
Google has become a massive corporation, offering software and hardware services worldwide. It is now considered synonymous with the Internet itself. With its expansion and ever-increasing success, Google takes advantage of all types of outsourcing to enhance its organization.
Skype Outsourcing Strategy
Skype is a leader and a precursor in the online visual media field. It is another major company that uses outsourcing strategies. They brought numerous developers to work on their project, and as time passed, Skype brought those same developers as partners.
McDonald’s Outsourcing Strategy
McDonald’s follows a “one world, one burger” philosophy, aiming for consistency in the cost and quality of its burgers worldwide. To ensure this, all of its suppliers comply with the internationally recognized HACCP systems, which subject inputs and finished goods to chemical and microbiological tests to maintain food freshness and prevent contamination.
Boeing’s Outsourcing Strategy
Boeing refers to outsourcing as “Offloading.” The aerospace company has increased the amount of outsourcing in the industry, which has resulted in a big trend. 65-70% of the content for a given airplane is procured from outside sources. Their strategy behind outsourcing is to become an integrator and to “move up the value chain.”
Other companies that use excellent outsourcing strategies are:
For more information, check out our sample essays below!
📝 Outsourcing Strategy Research Paper Examples
- Service Procurement And ProvisionBusiness essay sample: The report is going to focus on a strategic review of Benenden hospital, which is one of the most popular medical centers in UK.
- Outsourcing and Other Staffing TrendsBusiness essay sample: Outsourcing may be defined as a subcontracting process that hires a third-party company to perform some specific operations of the business.
- Outsourcing in Pharmaceutical IndustryBusiness essay sample: The main objective of outsourcing in the companies is to reduce the production cost but at the same time increase the business profits this is the perceived aim.
- Case Study: Small Players Frock to IndiaBusiness essay sample: Currently many small companies, located in Australia prefer to outsource some of their business processes to India.
- H2O Company : Human Resource Functions AnalysisBusiness essay sample: This paper is aimed at looking at some of the various issues affecting H2O’s human resource department and give recommendations on what the company ought to do.
- Travel Magazine Executive Summary: OutsourcingBusiness essay sample: This paper analyzes the processes that an organization that plans to be producing travel magazines will outsource and those that it will keep in-house to enhance the magazine business.
- Toyota and Ford: Supply Chain ManagementBusiness essay sample: The contrasting approaches taken by each of Ford and Toyota in managing the supply chain indicates different areas of focus in business processes for both companies.
- Unilever PLC.: Strategic Supply Chain ManagementBusiness essay sample: Supply chain management defines the management of a network of businesses which are involved in the provision of products and services to end users.
- Advantages and Disadvantages of Human Resource OutsourcingBusiness essay sample: HR management is highly applicable for the multinational companies. An efficiently managed HR outsourcing gives the company a competitive advantage hence maximized returns.
- EBay: Customer Support OutsourcingBusiness essay sample: Customer support outsourcing for eBay is a brilliant idea since it will increase the economic stability of the world at large.
- The Growing Outsourcing Trend in Today’s Business MarketBusiness essay sample: Outsourcing can offer a good advantage to some companies. Or it can be a disadvantage either. If the government will prioritize the labor workforce, companies would not hesitate to hire them.
- Warehouse Role in PostponementBusiness essay sample: The elementary principle for this assignment is basically to evaluate how the corporations are faced with the warehouse constraint and how they play the role of postponement.
- Zara Operations Management & Strategy Case StudyBusiness essay sample: What is Zara operations management style? 👚 Zara business model has proved to be successful due to their objectivity to outsourcing, which serves as a cost reduction strategy. 💸
- Abu Dhabi Distribution Company: Supply Chain ManagementBusiness essay sample: Abu Dhabi Distribution Company has an objective of providing highest standard services for its clients. This calls for a diverse international system of suppliers.
- Outsourcing: Examination of the Details of OutsourcingBusiness essay sample: Outsourcing refers to a situation where a particular firm goes beyond the resources available and searches for additional help from other sources that are not in the firm’s reach.