International Trade Outsourcing Offshoring and Research Paper
- Length: 7 pages
- Sources: 7
- Subject: Business
- Type: Research Paper
- Paper: #53700138
Excerpt from Research Paper :
"Dell recently established customer and technical support centers in India, China, Morocco, Panama, and Slovakia and has set up design centers in Taiwan and China. Furthermore, it not only has manufacturing facilities in Texas and Tennessee, but also in Brazil, Ireland, Malaysia, and China" (Pruitt, 2012).
Eeven though Dell has come under fire along with other companies by critics who say that offshoring is robbing U.S. citizens of jobs, the company's new chief executive officer has said that Dell will carry on to engage in the practice. The company's current chief operating officer has said that the issue of offshoring in regards to Dell has been overblown. Dell has said that it will persist to employ people overseas, where it sees market growth. The company derived almost forty percent of its revenue from international sales for its fiscal year 2004. In addition, it says that its potential growth is dependent on its success in international markets (Pruitt, 2012).
Even though there are disadvantages, outsourcing and offshoring are trends that show no sign of stopping. The capability of companies to outsource or offshore their non-foundation functions to capable companies saves them millions in overhead and payroll costs. Cost successful information technology is coming on the scene daily making it even easier for companies to flawlessly work together and communicate as one virtual corporation. So, the profit reason coupled with cost-effective technology corresponds to a fundamental guarantee that outsourcing and offshoring will be alive and well throughout the 21st century (Chestnut, 2012).
The outsourcing and offshoring trends have had and will continue to have a spectacular affect on jobs in all participating countries. The jobs and the superiority of jobs in each country depend on the global competitiveness of each country. The global competitiveness of each country depends on how well each country innovates. "For example, if you think of the global economy as a ladder and competing countries as rungs on that ladder, right now the United States and other developed countries are at the top rungs on the ladder, and developing nations are at the lower rungs on the ladder. To stay on the top rungs, the United States and other developed nations try to effect favorable world trade policies and continue to cultivate innovation and the creation of new industries and products; otherwise, these countries could be overtaken by the developing nations who are hungry and continuously innovating and upgrading their standards of living" (Chestnut, 2012).
Outsourcing and offshoring is likely to increase as new, less costly collaborative technologies enter the scene and offer a rising number of developing nations and small businesses an occasion to partake in the global economy. Even though the global economy is all-encompassing today, still, more than eighty percent of most small businesses still do business only at a local level, within their communities. "Normally, only large, multinational corporations take advantage of the benefits the global economy has to offer. However, as information technology processes and legal barriers across borders continue to improve, this will change" (Chestnut, 2012).
With more and more companies going global it is more and more important for consumers to accept companies doing business abroad. In order for companies to continue to grow and prosper it is important for them to be able to do business where ever they want to. On the other side of the coin it is also important that companies understand the consequences that offshoring has on consumers. Consumers want nothing more than for companies to stand behind the products that they sell or the services that they perform. In the case of a company like Dell, the typical consumer wants nothing more than to know that if they have a problem, there is someone that they can contact that will help them.
The key to offshoring is finding the right balance between what is good for both the company and the consumer. The advantages and disadvantages must be weighed against each other before a company makes a decision whether to offshore or not. It is understandable that companies want to cut costs on all possible fronts, but they need to make sure that this does not cost them the one thing that is more important than anything else -- customers. Because in the end a company that has no customers is not positioned to be in business for very long.
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