Recap Aims Distinguish between outsourcing and offshoring Identify

Recap

Aims: • Distinguish between outsourcing and offshoring • Identify benefits of flexible working practices

Consider the following clip. . . http: //tutor 2 u. net/blog/index. php/business-studies/comments/outsourcingillustrated-in-30 -seconds-xerox-and-marriot-hotels/ • What is the Merriot Hotel chain outsourcing? • Why does the hotel chain outsource this admin task? • What is the ad humorously suggesting might happen should staff be forced to take on more admin tasks?

Read the two articles about outsourcing and identify the possible benefits and drawbacks of using this working practice.

Outsourcing V Offshoring – whats the difference?

Which one?

The fundamental advantage of offshoring is the potential gains for competitiveness: • Access to lower unit costs • Access to more specialised suppliers and services • Economies of scale from operating in larger international markets

However. . . • Customer service: a combination of poor training, cultural differences and local management sometimes lead to worse customer satisfaction • Higher than expected costs: low-wage economies like India and China might seem attractive, but there are many hidden costs associated with offshoring • Public and employee relations: a decision to “move jobs” from the UK to a low-wage economy is a sensitive one. Handled poorly, the damage to public and employee goodwill can be significant

Teleworking/homeworking