ON

OUTSOURCING
Name- Akash
Andotra
Class- MBA Sem-II
Roll No.-604
Submitted To- Mr.
Vinay Kesar
Outsourcing
The process of turning over an organizations
computer central operations,
telecommunications networks, or applications
development to external vendors of these
services is calledoutsourcing.
Activities such as software programming,
operation of large computers, time-sharing
and purchase of packaged software have to
some extent been outsourced since the
1960s.
Advantages of
Outsourcing
Economy:Outsourcing vendors are
specialists in the information systems
services and technologies they provide.
Through specialization and economies of
scale, they can deliver the same service
and value for less money than the cost of
an internal organization.
Advantages of Outsourcing(contd.)

Service Quality:Because outsourcing

vendors will lose their clients if the
service is unsatisfactory, companies
often have more leverage over external
vendors than over their own employees.
The firm that out-sources may be able to
obtain a higher level of service from
vendors for the same or lower costs.
Advantages of Outsourcing(contd.)

Predictability:An outsourcing contract

with a fixed price for a specified level of
service reduces uncertainty of costs.

Flexibility:As information technology

permeates the entire value chain of a
business, outsourcing may provide
superior control of the business because
its costs and capabilities can be adjusted
to meet changing needs.
Disadvantages of
Outsourcing
Loss of Control
Dependency
Vulnerability of Strategic Information
THANK YOU