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Company Work Outsourcing U.S Operations Lower Type Offshored

Id ESLPod_0216_CN
Episode Id ESLPod 216
Episode Title Outsourcing Operations
Title Outsourcing Operations
Text

Many companies outsource to reduce costs. It makes sense that if a company can get work done by hiring an outside firm, they will have a "competitive advantage" or a better chance of getting a customer because of their lower prices. As outsourcing has become more common in U.S. companies, however, it has become more "controversial," or something that people disagree about. The most controversial part is "offshoring," or transferring a company's work to another company in another country that specializes in that type of work. The two areas in a company most likely to be offshored are production and service.

American companies have, for a long time, offshored production or manufacturing to countries where "labor" or paid work is cheaper. For instance, U.S. companies may "manufacture" or make their electronic parts in Taiwan or make clothes and toys in China. Until recently, companies didn't think that services could be offshored. With the creation and improvement of telecommunications, however, many large U.S. companies have transferred their call centers offshore. Even though the company provides a phone number in the U.S., calls are "forwarded" or sent to a different company that's been contracted to take them, such as those in India, South Africa, or the Philippines.

Although offshoring is becoming more and more common, there have been "critics," or those who have a negative opinion. One of the drawbacks they point out is that offshoring results in lower quality of service. These critics argue that because outsourced workers don't actually work for the main company (they work for the company that's been hired to do the work), they might not care about the quality of the job they're doing as much as regular workers would. And, since outsourced companies tend to do one type of work for many companies, some say that special needs that a company has may not be served.

Topics Business

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