IT Outsourcing

Paper Summary:

This paper examines the benefits of companies outsourcing projects, especially in the area of information technology. Outsourcing is defined and reasons are given why a company may decide to use outside contractors over in-house employees. Various countries that have profited from outsourcing are listed, followed by a discussion of how outsourced jobs may affect the US economy. Globalization as it relates to outsourcing is analyzed. Next, the paper devotes a large section to IT outsourcing, which includes a list of the benefits of this way of doing business. The paper concludes by acknowledging the role of management in making an outsourcing project successful.

Outline:
Introduction
Outsourcing defined
Outsourcing in Developing Countries: the Aftermath of Globalization
Table 1. The Role Played by the Developing Countries in Trade and Capital Flows
Table 2. Regional perspective on the Effects of Globalization.
Table 3. The Effects of Globalization in Selected Countries
Global IT Outsourcing
Conclusion

From the Paper:

"There are many reasons why outsourcing or contracting out work is more preferred rather than developing in-house talents. First, it is seen as more cost-effective (Domberger, 1998)-for example, a contracted personnel from other countries require only smaller salary because of the certain standardized salary scheme within the country; second, to cut cost and refocus resources (Holt, Kennedy, Rehg & Ward, 2002) . A large company with numerous personnel with no specific work is the same with a company with smaller personnel but with specified work. This was done through outsourcing of different functions from different sources. And third, lower investment in internal infrastructure (Reaser, 1996), it will be built instead to the outsourced country. "

Sample of Sources Used:

• Ades, Alberto F. and Edward L. Glaeser (1999). Evidence on Growth, Increasing Returns, and the Extent of the Market. The Quarterly Journal of Economics, pp. 1025-1045. .
• Ahmed (2006). BBC News Article on India dismisses outsourcing fears. From http://news.bbc.co.uk/2/hi/business/347291.stm
• Amoore, Louise. (2002). Globalisation contested : an international political economy of work. Manchester. Manchester University Press. ISBN 0-7190-6096-6
• Bettis, Richard A., Bradley, Stephan P., & Hamel, Gary. (1992) "Outsourcing and Industrial Decline." The Academy of Management Executive. 6: no. 1: 7-22.
• Brudney, Jeffrey L., Sergio Fernandez, Jay Eungha Ryu, Deil S. Wright.(2005). Journal of Public Administration Research and Theory (15).

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