Offshore Outsourcing: The

Direction To Head?

A presentation by: Shan Lin

SLC: Magnet

Background InformationOriginated from Adam Smith’s “Wealth of Nations” A process of hiring external organizations in different

countries to conduct business functions that are normally performed within

Tactic is becoming popular for U.S. companiesIncreasing concern for U.S. workers in recent decades

Common Controversies Insecurity

Identity and Data Theft

Job losses

Control

Quality

Costs

To Outsource or Not?The world is heading toward a

single global economy and offshore outsourcing is the only way for the U.S. to thrive in this economy.

Offers many advantages that outweighs the disadvantages

Short term lose with long term gains

Outsourcing’s Impact

Household

Businesses

Govern

Household’s PerspectiveOutsource of manufacturing and tedious jobsBetter conditioned jobs for U.S. workersHigher quality and more choices of goods and services

resulting from competitionLower PricesHigher standard of living

Job Loss Vs. Job CreatedAn increase of 327.7 million

jobs to the labor market while only 309.9 million jobs were lost during the decade from 1993 to 2002

Between 1983 and 2002, the total number of better condition job positions rose by 80%

The number of high paying jobs has climbed from 23.4 % of the total employment to 31.1%

Business’s BenefitsLower cost of productionIncrease efficiency and capacityConcentration on core business processesContinued InnovationReduce Risk

Government AdvantagesClose relations with outsourcing countriesLower costs of operationHigher revenue from business taxesMore focus on important matters

What does this all mean?Offshore outsourcing has proven itself to be benefiting for

our economySmall sacrifices to obtain bigger rewardAmerican household will have more and better jobs Companies will be more efficient and have lower costsGovernment will gain from the prosperous economy

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Davison, Dean. "Top 10 Risks of Offshore Outsourcing - ZDNet." Technology News, Analysis, Comments and Product Reviews for IT Professionals | ZDNet. 09 Dec. 2003. Web. 16 Nov. 2010. <http://www.zdnet.com/news/top-10-risks-of-offshore-outsourcing/299274>.

French, Ron. Driven Abroad: the Outsourcing of America. Muskegon, MI: RDR, 2006. Print. Haugen, David M., Susan Musser, and Kacy Lovelace. Outsourcing. Detroit: Greenhaven,

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Thondavadi, Nandu, and George Albert. Offshore Outsourcing: Path to New Efficiencies in IT and Business Processes. U.st.: 1st Library, 2004. Print.