When it comes to defining the benefits of outsourcing from countries like India and China, one must admit that a comparatively low cost is the most obvious benefit. Indeed, a closer look at the specified countries will reveal that the cost of the services, which the labor force from the target states will require, seems to be the basis for the decision-making process. Carter, Maltz, Yal and Maltz (2008), however, points to the obvious problems that the specified approach involves.
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Specifically, the fact that the difference in the labor cost may shift the values paradigm from the appreciation of the staff’s skills to the search for the cheapest offer possible; as a result, the quality standards in the outsourcing company may drop significantly. Therefore, it is imperative to realize that the ability to adopt a flexible and sustainable approach to leverage the cost-and-quality balance is the greatest advantage of outsourcing from countries like China and India.
The opportunity of mapping the outsourcing process and, therefore, getting the firm’s priorities in line prior to the assignment of the new staff members with their roles and responsibilities is another obvious advantage of the approach discussed.
Moreover, the significance of eliminating the existing cultural biases and preventing prejudices from affecting managers’ decisions deserve to be brought up as legitimate advantages of outsourcing from China and India. Seeing that a range of members of the U.S. companies assume that outsourcing from third-world countries concerns solely the financial benefit, a deeper insight into the specified process may shed some light on the actual benefits, such as the experience that the staff in question has, the knowledge and the skills that these employees possess, etc. In other words, the adoption of the strategy under analysis may lead to a gradual destruction of the harmful prejudices concerning the workforce outsourced from countries such as India and China.
It should be noted, though, that the specified approach is far from being flawless. Needless to say, the above-mentioned misconception regarding the reasons for outsourcing from countries such as China and India may affect a company significantly. To be more exact, by underrating the importance of the staff’s experience and the need to invest in the new employees, an organization may lose an opportunity to create a strong foundation for an efficient human resource management strategy.
The communication issue may also pose a significant threat to the success of the idea of outsourcing from the third-world countries such as India and China. For instance, the connection issues that may occur during an important communication process between the U.S. company and the corresponding Chinese or Indian organization may trigger impressive losses or, in the worst-case scenario, lead to an inevitable failure of a specific project or even an entire entrepreneurship: “Long distances also increase the length of communication lines, decreasing the closeness of contact and making problem solving at an operational level difficult” (Fredriksson & Jonsson, 2009, p. 232).
Despite the above-mentioned concerns, the idea of outsourcing from the states like India and China certainly is beneficial to both parties and, therefore, has to be encouraged. When carried out in a proper manner, it may affect an organization positively. Allowing for the development of a good HRM approach, the specified method should be viewed as a legitimate human resource management tool.
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Carter, J. R., Maltz, A., Yal, T., & Maltz, E. (2008). How procurement managers view low cost countries and geographies: A perceptual mapping approach. International Journal of Physical Distribution & Logistics Management, 38(3), 224–243. Web.
Fredriksson, A., & Jonsson, P. (2009). Assessing consequences of low‐cost sourcing in China. International Journal of Physical Distribution & Logistics Management, 39(3), 227–249. Web.