Outsourcing Employee Efficiency and Organizational Productivity

Question: Discuss about theOutsourcing for Employee Efficiency and Organizational Productivity. Answer: Introduction: In a business world characterized by the idea of globalization, the importance of outsourcing cannot be overemphasized. Outsourcing is one of the few cost-saving management strategies adopted by an organization, whereby an organization gets its task performed, with the help of external support from a foreign nation. Outsourcing as a recently emerging management trend has captured the attention of a huge number of entrepreneurs, simply because it offers the opportunity of reducing labor and operational cost, while at the same time helping the organization improve employee efficiency and organizational productivity, thereby leading to the organizational success (Oshri et al. 2015). Discussion: According to the Harvard Business Review, outsourcing is one of the most effective business ideas that has taken the world of business by storm over the last 75 years. The process of offshore outsourcing has been largely benefitting the organizations, by helping them focus on the core products and major functions of the company. It is being employed as one of the important strategies of a organization, and it is worth-mentioning that the organizations, working in dynamic markets, such as telecommunications, or professional services, source more than 40% of their operations outside their own country. Some of the greatest benefits of outsourcing as a management technique adopted by an organization, include improvement in the quality of the consumer service, an increase in the shareholder value and increase in the efficiency of the workforce without the need of investing in people or technology (Hirschheim et al. 2013). General Framework: As far as the Australian industry is concerned, the nation has experienced a steady business growth in the field of Business Process Outsourcing. The very reason as to why outsourcing has revolutionized the system of business operation in Australia, is that it offers the benefit of flexibility of business operation, low entry cost, and greater market opportunities to the organizations. Besides, the small Australian organizations, as a result of outsourcing, are capable of getting the ticket of gaining access to IT infrastructure, and other advanced technology that are too expensive for the Australian firms to adopt (Relph and Parker 2014). Australian organizations, such as IBM, Zeidan, Tradesafe Australia Pvt Limited, Active Occupational Health Services, are some of the most recognized organizations of Australia that engage in the process of outsourcing. However, despite the innumerable advantages that outsourcing offers, it also may pose serious threat to an organization, because of the risk of the loss of sensitive data, or even loss of management control over the important functions of the organization (Susomrith and Brown 2013). Individual Components: Among some of the most recognized organizations that have successfully employed the strategy of outsourcing is Telstra. It is important to mention here that the outsourcing method is not only being utilized by the organization for reducing its operational cost, but it also largely benefits the organization in improving the use of its internal resources as well as consumer satisfaction (Bursell et al. 2016). The organization has emerged to be a successful organization, increasing its profitability and revenue-earning capacity by outsourcing its service to countries such as Philippines and India. The organization has succeeded in creating a back office hub, in Manila that has largely helped the organization reduce its labor cost, thereby increasing its annual profit. The organization, in fact has launched the Project New in the year of 2010, that has been largely helpful in eliminating operational cost, by outsourcing a variety of jobs. Outsourcing their call centers as well as consume r service providers has been largely beneficial in this regard. In fact, Telstra as a part of its next move of the outsourcing strategy, has shut down the centre in Perth, to move to Bathurst and the Philippines, as it is likely to offer them greater competitive advantage (Cardona et al. 2014). It should be remembered that Telstra, as one of the premier telecommunication industries of Australia is largely benefitting by outsourcing their service. As a result of the emergence of new players every day in the industry, Telstra has been finding it tough in keeping up with the consumer acquisition as well as retention cost. Hence, Telstra has formed alliance with IBM Global for getting help and support from the latter in streamlining and simplifying its internal procedures and systems, As Richard Allem, the Chief procurement Officer of Telstra claims, the organization has to handle multiple people buying a variety of contracts from the organization, and hence it is highly important for the organization to deliver its functions in a cost effective way, and this is the reason why Telstra employs outsourcing. The organization engages in outsourcing its business activities, such as financial accounting or implementation of IT infrastructure, so that it can focus solely on its busine ss growth. Conclusion: Outsourcing has become the latest and one of the most effective trends in the business world. However, before taking the decision of outsourcing the service, an organization must consider certain important factors. The question as to what service an organization requires, or which service provider is best positioned for serving the purpose are some of the important factors that need to be considered. Reduction in cost, availability of specialized skills, and economies of scale and scope largely benefit organizations like Telstra. However, outsourcing may have adverse impact on the labor force of the home country, and as was the case with Telstra, many organizations often indulge in axing of jobs. Hence, such factors should also be considered while adopting it as an organizational strategy. Reference List: Bursell, S.E., Zang, S., Keech, A.C. and Jenkins, A.J., 2016. Evolving telehealth reimbursement in Australia.Internal Medicine Journal,46(8), pp.977-981. Cardona, J.C., Stanojevic, R. and Laoutaris, N., 2014, December. Collaborative consumption for mobile broadband: A quantitative study. InProceedings of the 10th ACM International on Conference on emerging Networking Experiments and Technologies(pp. 307-318). ACM. Hirschheim, R., Heinzl, A. and Dibbern, J. eds., 2013.Information Systems Outsourcing: enduring themes, emergent patterns and future directions. Springer Science Business Media. Oshri, I., Kotlarsky, J. and Willcocks, L.P., 2015.The Handbook of Global Outsourcing and Offshoring 3rd Edition. Palgrave Macmillan. Relph, A. and Parker, D., 2014. Outsourcing: a strategic risk.Management Services,58(3), pp.20-24. Susomrith, P. and Brown, A., 2013. Motivations for HR outsourcing in Australia.The International Journal of Human Resource Management,24(4), pp.704-720.