The Negative Aspect Of Outsourcing! »
Posted by: omerazam 2 months agoOutsourcing is subcontracting work to a third-party company, either for product creation, design or some service. Outsourcing has always been carried out by many major businesses as well as smaller companies. As far as corporations go, this means business process outsourcing
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flyonthewallzz2 months ago
Our own people are not the cheapest in the world.
I think we compete quite well in terms of productivity.
We definatly put in a lot more hours than folks in other OECD countrys.
If there is anything like a free market left then exploiting cheap wages overseas is a short term option.
I think the "cost to live" in this country needs to be evaluted.
Honestly
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donald512 months ago
This should be under politics where it would get a lot more due attention!
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bigurn2 months ago
Hold on a minute! There are two different discussions to be had here. There is a gigantic difference between generalized outsourcing and global outsourcing.
Outsourcing itself is neither inherently positive nor negative. Any time you allow a business process for which you are responsible to be conducted by someone other than a company employee, you are outsourcing. In business, these people are called "suppliers" or "vendors". It is a widely held belief that concentrating on a business core competency is a good thing, and most businesses do this.
Global outsourcing has been given a bad name because in some cases it means that the work has been given to a business in another country simply to reduce labor costs. OK, that's true, but it's not exclusively true nor correct. It is true that the total costs of global outsourcing are beginning to equalize, and one of the benefits of a weak dollar is that it becomes cheaper to keep the work here.
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Bruedaddy2 months ago
Oh B.S.
FREAKIN B.S.
You like to "sound" smart but you grossly miss the point oh learned one.
global outsourcing is always going to be BAD for US. Americans work damn hard...the only diff is that WE expect to be treated FAIRLY and PAID FAIRLY. It's Corp. GREED that is sending our jobs out of this country and NOTHING else.
So, STOP buying things from companies that handily send OUR jobs away and THEN you'll see a change...and ONLY then.
It's not easy...go to buyamerican.com or any other site you can find....
AND, Why do we have to have a bad economy that translates to a weak dollar so corps can "afford" to hire US?
That's just F'd up.PERIOD.
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bigurn2 months ago
"global outsourcing is always going to be BAD for US" - not when other countries outsource to us; it adds to the economy.
"Americans work damn hard...the only diff is that WE expect to be treated FAIRLY and PAID FAIRLY". Americans do work hard, almost the hardest in the world. That doesn't mean that what we do has the value we think it does.
"It's Corp. GREED that is sending our jobs out of this country and NOTHING else." Corporations have a fiduciary responsiblity to their shareholders, and that includes turning a profit. That's not greed, it's capitalism.
"So, STOP buying things from companies that handily send OUR jobs away and THEN you'll see a change...and ONLY then". If I artificially restrict my free market choices, then I'm ultimately asking my suppliers to fail to compete. This always ends up badly for the supplier; competition is not fun, but it's fairer than a closed economy.
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bigurn2 months ago
"AND, Why do we have to have a bad economy that translates to a weak dollar so corps can "afford" to hire US?"
We don't. That's just the situation right now. If you can deliver a product or service that is better, cheaper and faster that anyone, anywhere, customers will beat a path to your door. This is the essense of competition, of capitalism, of free market economics, and frankly, it's how this country became successful. It absolutely demands that somebody will lose, but so that the majority will be better for it. The alternative is to close the economy, equalize success so that no one loses, and everyone is happy. For a while. Eventually, the world will move on, because that system always induces poor practices and it becomes a self-defeating house of cards that crumbles under its own weight.
You have choices, but all choices have an expiration date on them.
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mark-stevens2 months ago
The first Bush spoke of a "new world order" to put that bluntly, it means working for board and room, the same thing that ants do.
look at our goverment (or who ever is running this country) out sourcing, busting unions, allowing illegal immigration. Is your life style heading in the wrong direction?
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CHAM2 months ago
Well spoken Mark Stevens. I guess I heard the "New World Order" spoken in the 70's or 80's so it didn't start with Bush but actually it really picked up steam when electronic data could be moved efficiently.
I worked for a Company in the 70's that began to outsource to Singapore. The Company would find a Man who had some expertise in manufacturing. Our Company would furnish this Head of Household all necessary equipment, tools, gages, and materials. The Family would supply the labor.
The profit margin was tremendous because the Singapore father would put his children to work. They worked for table wages. There is no way that an American could compete with this type set up.
It is true that some outsourcing occurs for specialization of a process/product but the greatest majority of Outsourcing is done to take advantage of low priced labor. Think Child Labor.
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danielistical2 months ago
any one noticed al of a sudden almost any decent paying job has been outsource all the way out of the country??
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Justice4All2 months ago
I work for one of the guilty companies. We have been outsourcing for several years now and at an increasing rate. But in order to change things you need to understand why we do it and it's probably not what some people want to hear.
The problem is not high salaries in the US. It is the related costs. That means lawyers. They tell us who to hire and who we can fire. When you look at the crazy lawsuits that people have used when we let them go you will understand that that is also a labor cost. Even a lawsuit based completely on lies and which can easily be shown to be fradulent will cost us 100's of thousands of dollars.
Next time you see an ad for a lawyer on TV write down their number and thank them for sending your job to China.
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HMMace2 months ago
OUTDOURCING-----THE PEOPLE LOSE JOBS
THE COUNTRY LOSES INCOME TAX
THE COMPANYS LAUGH ALL THE WAY TO THE BANK..
WE ARE DUMB TO BUY THAT CRAP FROM CHINA..
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chevydog2 months ago
This particular article is talking about outsourcing services, as opposed to the outsourcing of manufacturing that is generally a hot topic.
If I'm a smaller company, I'm going to have a hard time finding and/or justifying a single person to do lots of miscellaneous tasks. Maybe outsourcing works for this situation. I'm not sure that it costs jobs-just moves them from one place to another.
But if the particular funtion is essential to my business, I'm probably going to want more control over it.
Seems to me wht one should be worrying about more is sub-optimization; making a little part of your process very efficient, but at the cost of hindering your overall business objective.
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fotoman11334062 months ago
Guys,
Outsourcing... was invented for the stockholders and boss's benefit; not the employees. Outsourcing; is just 'cheap' labor. And that puts MORE money into stockholders and boss's pockets.
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antibrainwasher2 months ago
The co-host of a recent top-dollar fundraiser for Sen. John McCain oversaw the payment of roughly $1.7 million to a Colombian paramilitary group that is today designated a terrorist organization by the United States.
Carl H. Lindner Jr., the billionaire Cincinnati businessman, was CEO of Chiquita Brands International from 1984 to 2001, and remained on the company's board of directors until May 2002. Beginning under his tenure, Chiquita executives paid hundreds of thousands of dollars to the United Self-Defense Forces of Colombia (known by the Spanish acronym AUC), which is described by George Washington University's National Security Archive as an "illegal right-wing anti-guerrilla group tied to many of the country's most notorious civilian massacres."
And John McCain's campaign has personally benefitted to the tune of $2 million from a fundraiser co-hosted by Lindner:
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antibrainwasher2 months ago
The co-host of a recent top-dollar fundraiser for Sen. John McCain oversaw the payment of roughly $1.7 million to a Colombian paramilitary group that is today designated a terrorist organization by the United States.
Carl H. Lindner Jr., the billionaire Cincinnati businessman, was CEO of Chiquita Brands International from 1984 to 2001, and remained on the company's board of directors until May 2002. Beginning under his tenure, Chiquita executives paid hundreds of thousands of dollars to the United Self-Defense Forces of Colombia (known by the Spanish acronym AUC), which is described by George Washington University's National Security Archive as an "illegal right-wing anti-guerrilla group tied to many of the country's most notorious civilian massacres."
And John McCain's campaign has personally benefitted to the tune of $2 million from a fundraiser co-hosted by Lindner:
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CHAM2 months ago
Antibrainwasher, You certainly have put it accurately and I never cease to be amazed at those McCain supporters who will spend endless time looking for the flyspecs concerning Obama and at the same time totally ignore the very visible corruptive events including and surrounding McCain.
It's kind of like preachergate. A lot of hullabaloo over the Reverend Jeremiah Wright, who was a whiner about "Whitey" caused Obama grief, while at the same time the MSM was almost oblivious of the two McCain endorsed Televangalist who are calling for war and more war.
Wright was an irritation, Parsley and Hagee are dangerous.
Parsley is calling for the annhilation of Islam and Hagee is wanting to help start wars in the Middle East involving Israel so that Armaggedon can be speeded up.
How could thinking people rail about Wright and totally ignore those such as Parsley and Hagee?
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bonaroo2 months ago
From around the 1950's to now our population has doubled. At the same time manufacturing processes have become exponentially more efficient, with the computer age and robotics and more sophisticated materials. It's process design and incredible capital investments that have made Asia the new leader in manufacturing. Massive investments in container shipping and cargo distribution help deliver these products all over the world. Walmart has thrived in this scenario. The problem is that by the time these products reach the retail outlets most of the jobs are minimum wage or less, lowering the standard of living in most cases. Rather than many small mom and pop stores, you have the big box outlet. Because this distribution system works so well, they are able to sell small appliances that used to be made in America for much less.
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CHAM2 months ago
bonaroo, it is true that efficiency has been the driver for much of what we have today. But I would like to remind that Wal-Mart hasn't always been a big box store. I remember when it started. One store in Arkansas. The thing that set Wal-Mart aside from Sears, Penny's, and the 5 & 10's was their marketing strategy, assigning a value to every square foot in a store and placing stores in the quasi-rural areas. Sears and Penny's and Woolworth for example, disdained this strategy, instead opting to require customers come to them as opposed to the Wal-Mart "We will go to the customer" strategy.
I also remember when Wal-Mart was the only large retailer calling for the public to "buy America". And they pushed this hard.
Wal-Mart's distribution and marketing sets them aside from all other chains except those that have started to copy their model.
I am not a Wal-Mart employee, but do have relatives who are.
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bonaroo2 months ago
I'm not arguing right or wrong, but describing what I see. Forward thinking retailers such as Target and Walmart have now included food distribution in their marketing plans to take advantage even further of the one stop shopping scenario. Warehouse stores, such as Costco also follow such plans. Economies of scale only work as long as the displaced jobs are replaced with a new job. That is what the article is about. It's not that these business models are wrong, its that the system is unsustainable without the creation of new jobs, and only leads to the have and have not scenario we have today.
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chevydog2 months ago
Some good points. You might note that although they generally, though not always, have lower cost labor than the US that their manpower usage is usuallly better.
Don't think that there are any manufacturing processes that Asian economies have access to that we couldn't implement if we wanted to. And for many, labor costs are only a minor issue. Good distribution is super, but it's still a cost; and it shouldn't be able to outweigh good manufacturing.
Think we have to wonder why US compnies aren't investing in newest technology instead of financial "fluff" activities.
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CHAM2 months ago
Chevydog
Your assessment is exactly what I would have said if I had your ability to do so.
All transport cost have a best value. The Asians can study Quantative Analysis and minimize and maximize to their hearts content. But so can we and Wal-Mart did.
I recall studying the transport problem during my college studies in Quantative Analysis and don't have a clue how many times I ran Iterative studies on processes. Wal-Mart just did it better than their competitors.
I have a relative who is employeed as a Transportation Manager for Wal-Mart and I assure you they know their stuff.
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bonaroo2 months ago
chevydog
Manufacturing technology is what has changed. The days of people sitting around and making things is pretty much over. I think that the low labor costs is a myth. Cars are now made to a large degree by robots. I've seen pictures of textile mills in China that are about the size of two football stadiums filled with automated looms that only require about 6 people to run. By investing in the state of the art plants they are the originators of the products. Only by reversing the process going the other way can we balance the trade deficit.
This is why I'm an advocate of alternative energy. This is a product that the world needs that we can export. Retrofitting our own infrastructure will create many new jobs while the export of state of the art technology will provide a balance to our imports.
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CHAM2 months ago
Bonaroo, I agree with what you write except I somewhat disagree about the implied impression that Wal-Mart is successful because of Outsourcing. I remember when Wal-Mart started up. Their business strategy differed from the then Big Box Stores,Wal-Mart placed a value on each square foot of display in the stores. Non sellers got replaced. They also decided to make stopres very accessible to the public instead of "Downtown" store mentality used by the top chains. Finally they strategically placed their distribution centers to minimize transportation costs.
You may recall that at one time Wal-Mart was the champion of "Buy America". It was doomed because the other chains had discovered outsourcing and this caused Wal-Mart to Buy America.
Finally the publicized knock against Wal-Mart is that they harm mom and pop stores. Why do they do that? Because those small stores cost more for the same products and have less to offer in variety. That won't change.
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CHAM2 months ago
Sorry about all the doubling above but I guess Propeller was so slow in posting that I thought the comment wasn't posted and redid it.
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canadianrancher572 months ago
When people in the rural areas of most of the world think of the US the first thing that comes to mind is John Deere Equipment and the John Deere green color, it is something that is known world wide. This spring I need a fuel shutoff solinoid for my John Deere tractor and when I picked it up the first thing that I noticed was right on the package was the Made In China sticker. There are alot of companies that are thought of as American but it seems they are American in Name only and no longer can boast about American Quality. These companies are motivated nowdays by one thing and that is keeping the shareholder happy and making profit, to me they are an insult to the American dream.
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flyonthewallzz2 months ago
The Massey Ferguson baseball caps are cool.
You get to walk around with a big "MF" right out in the open.
May not mean much to a lot of folks, but I went to an itty- bitty Qauker boarding school that had a dairy farm and orchard we had to work as part of the deal.
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