Outsourcing When the Business Functions Research Paper

  • Length: 9 pages
  • Sources: 9
  • Subject: Business
  • Type: Research Paper
  • Paper: #10993971

Excerpt from Research Paper :

Outsourcing ensures that the development as well as the startups of the businesses is faster and improved.

Outsourcing in Foxconn

Foxconn is one of the world's leading and most famous electronic manufacturing service providers. One of the most recent outsourcing-based moves that have been made by Foxconn includes terminating more than a million employees and replacing these with robots (Brown and Wilson 88). The main reason that was given by the representatives of the company was that more than 1.3 million employees were responsible for doing repetitive tasks in the manufacturing sections and the tasks were mind numbing based on which more errors were being seen in the performance of the employees. On the other hand, in the modern days, the manufacturing is a costly plan and when it comes to paying salaries and wages to more than a million employees, it is beyond being affordable. Thereby in the modern days of intense competition, affording mistakes and humanly errors is not affordable. Thereby these human errors have been replaced by the machine perfection where lesser number of robots will be responsible for doing the mind numbing and repetitive tasks in the manufacturing sections (Schniederjans, Schniederjans, and Schniederjans 100).

One of the main reasons that has been associated in a strong manner with more American organizations outsourcing their manufacturing to offshore countries is that the chosen countries that include China has a great population thereby greater population based on which costs of manufacturing are much lesser as compared to the costs in U.S.. In these cases, the outsourcing moves in Foxconn focuses on reduction of the labor costs and seeing more improvements in working and manufacturing efficiency. There is no doubt about the fact that the efficiencies that are shown by the robots is much higher as compared to what is shown by the human beings. Paychecks, increases in salaries and wages, food and lodgings are not required by the robots whereas these are the main requirements of the human employees (Corbett 25). One of the main disadvantages that have been highlighted in the case of replacing human employees with the robots is great changes that would be noted in the workplace diversity. Nevertheless, there are a number of advantages being seen in the perfection in software control and the engineering needed in the manufacturing sections. Other than the great reduction in the costs, one of the most important advantages that have been mentioned by Foxconn is that the human employees are in a need to be shifted up the value chain rather being stuck in the manufacturing section. The skills of these human employees are to be used at better places and positions within the organizations. Thereby one of the main facts that can be highlighted here is that if more than a million robots are hired in the manufacturing sections, the human employees that have been replaced can be retained for the maintenance and management of the automated lines. Thereby instead of hiring additional employees for the maintenance of automated lines, the same employees will be shuffled thereby causing additional cost savings (Zhang and Alon 66).

The better quality and reduced costs along with an increased efficiency has been the main reason of customer satisfaction and improved businesses around the world. An important asset which is now being enjoyed by the American organizations include the spirit of innovation and when the business units are outsourced, there are a number of workers and employees who enjoy being more innovative. With most of the tiring and repetitive work being taken over by the machines, the employees and the workforce that remains is working on improving their working skills that can contribute much more to the company's working skills. It has been reported that many employees in Foxconn are now improving their skills in high technology fields so that they can contribute more in the manufacturing sections. Thereby replacement of the human employees with the robots can be helpful as greater time is now available to the human employees for improving their work-based skills and to learn more in newer and innovative tasks (Hirschheim 34).


A number of important facts have been learned from the discussion above. Based on the facts above a set of recommendations will be mentioned in this section.

1. Other than manufacturing section outsourcing, there are a number of other business unit's that have been outsourced by a number of businesses in the past. It is important that the new and emerging organization take into account the main advantages that can be gained from outsourcing of business units other than manufacturing are given out to offshore businesses.

2. One of the main businesses operation that has been very less frequently outsourced by a very small number of organizations includes the HR. In these cases it is important that the organizations should target not only the cost savings but also functions optimization. Undoubtedly, human resources are one of the most important function units of the business that does not add too much value in the business. Thereby it is an administrative unit. If by the help of outsourcing, HR can function well and the advantages can be gained at the end of the authorities and the employees, countless benefits can be gained by the business as a whole.

3. When business is planning to outsource certain business units it is important that the risk calculation must be made. The first important fact in this case that is to be taken under consideration by the businesses is that there are two main kinds of risks that need to be assessed before outsourcing. First risk is associated with the repute and the quality of serve being provided by the chosen service provider thereby it is important that the repute and the service quality of the providers are assessed. The second important risks are in relation to the errors made by the service providers and the impacts that these errors have on the business itself.

4. One of the most important facts that are to be kept in mind by the businesses and the organization undergoing outsourcing is to make sure that the best available service providers are chosen. The choice of a bad service provider can do more harm to the organization as compared to the lesser degree of harms that could have been faced by the business without outsourcing. The repute, the end quality of the service being provided is to be thoroughly studied by the organizations before the businesses units are outsourced. In these cases, the procedures that can be adopted by the organizations include requesting the service providers for the proposals, comparison, and evaluation of the proposals after they are received and based on the requirements, choosing the providers that provide the best outputs.


Globalization has challenged many organizations and business in a multimember, making them function in a more cost effective way. With the aim of cost reduction, maintenance of higher levels of quality and customer satisfaction, businesses are now relying increasingly on the blessings of outsourcing. Foxconn is one of the leading electric equipment manufacturing company and it has outsources its manufacturing sections to more than a million robots that provide error free in-line manufacturing that is not only cost effective but makes sure that the highest quality of the products is maintained along with an increase in customer satisfaction.

Works Cited

Bragg, M. Steven. Outsourcing: a guide to-- selecting the correct business unit-- negotiating the contract-- maintaining control of the process. Edition 2. John Wiley and Sons, 2006.

Brown, D. And Wilson, S. The black book of outsourcing: how to manage the changes, challenges, and opportunities, Wiley Desktop Editions. John Wiley and Sons, 2005.

Burkholder, C. Nicholas. Outsourcing: the definitive view, applications and implications. John Wiley and Sons, 2006.

Corbett, F. Michael. The Outsourcing Revolution: Why it Makes Sense and How to Do it Right, Kaplan Financial Series. Kaplan Publishing, 2004.

Delen, Guus. It Outsourcing: An Introduction Best Practice, Van Haren Series. Van Haren Publishing, 2009.

Haugen, M. David., Musser, S., and Lovelace, Kacy. Outsourcing, Opposing Viewpoints. Greenhaven Press, 2009.

Hira, R., and Hira, a. Outsourcing America: what's behind our national crisis and how we can reclaim American jobs? AMACOM Div American Mgmt Assn, 2005.

Hirschheim, Rudy. Information Systems Outsourcing: Enduring Themes, Global Challenges, and Process Opportunities. Edition 3. Springer, 2009.

Schniederjans, J. Marc., Schniederjans, M. Ashlyn., and Schniederjans, G. Dara. Outsourcing and insourcing in an international context. M.E. Sharpe, 2005.

Sparrow, Elizabeth. Successful it outsourcing: from choosing a provider to managing the project, Springer professional computing, Practitioner series. Springer, 2003.

Wijers, Gerard., and Verhoef, Denis. It Outsourcing: Contracting the Partner, Van Haren Series. Van Haren Publishing, 2009.

Zhang, Wenxian., and Alon, Ilan. A guide to the top 100 companies in China. World Scientific, 2011.







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