Option C. Outsourcing Selected areas of the HR Functions.
Introduction
Outsourcing is the current trend in most management and operation activities of most companies. This is due to its flexibility, convenience and the indirect cost savings associated with it. Outsourcing refers to delegation of non-core processes or functions to other companies, organizations or other external specialists in their area of service while refers to a situation where an organization or a company decides to develop or to utilize some of the functions within its own departments to perform certain specialize tasks.
In large organizations, the HR executive decisions are mostly influenced by the high labor intensive sections which are systematically outsourced to smaller and easily manageable companies whose management is not very complex but their services are reliable. These services or production functions are mostly allocated to regions where their economic benefits can be maximized. Most of the workers are normally untrained and they do not possess other skills that may be utilized in other companies and there are in most cases trained in accordance to the requirements and needs of the company. (Bardhan and Kroll, 2003)The major organizational functions like the top decision making departments are rarely outsourced.
Competencies refer to a set of human behaviors, abilities, knowledge and skills that can have a direct impact on the success of the company positively considering the roles played by the employees of the respective company. When the competencies are carefully observed and their results analyzed and implemented, the efficiency of the employees can be enhanced. The success of the human resource department depends on competent decision making capability of the HR manager.
The technical, functional and operational expertise needed determines the nature of the company that can provide the resources required. Technical and complex operations will require more competent subcontractors for the specialized work. When outsourcing critical sections or departments in a company, the job specification and the ability of the outsourced company to achieve the desired results are part of the competencies
The major benefit of outsourcing besides cost savings and convenience, are to gain the best practices, access improved quality, allow the company to concentrate on the core business and also make use of the best technology. The motive and the drivers of the HR outsourcing should be clearly identified and defined. (Woodall, Scott-Jackson, Newham, and Gurney, 2009) The competencies form the foundation of the motives and drives for outsourcing decisions. (Balakrishnan, Mohan and Seshadri, 2008)
Companies that experience rapid changes in the labor or other resources in the market may outsource the major functions which are highly affected by such changes to avoid interruptions in its production processes. (Miller, 1987) Companies that adopt proactive strategies to deal with unpredictable situations may opt to rely highly on outsourced functions of other specialized smaller companies.
Outsourcing in the home market has major advantage of convenience in operations supervision and monitoring activities, access to specialized staff and government subsidies to induce job creation and expansion in form of tax waivers and other fiscal measures. The major disadvantage is mostly the high costs of labor in the home countries and lack of the raw materials required in the production processes.
The major problems related to outsourcing in foreign countries are the fears that the company’s proprietary skills may be pirated by other competitors or replicated by other unauthorized persons. The benefits may include, reduced capital needs and production risks, low wages and the available ability to focus mainly on the core competencies of firm.
The analytical skills espoused by the HR manager stems from the competencies and management skills and experience that are related to the responsibility. When the management settles for the
the protection of the symbiotic relationship that develops as a result of the partial outsourcing of the HR functions and outsourcing some sections. Organizational flexibility is also attained by the subcontractors.
The major weaknesses of the competencies regarding the outsourcing of non-core departments cannot affect the performance of the company involved in many regards but to outsource major functions of the production department to some countries like china will require more than the competencies can offer. The protection of the intellectual property rights must be guaranteed before the company outsources its critical sections. Like in the shoe industry, Nike utilizes the services of the subcontractors in all its manufacturing plants across the world. They have a major presence in China, Indonesia and in Vietnam. Other factories are in South Korea, Taiwan and Philippines. (Van, 1998)
Companies are normally reluctant to make huge investment in foreign countries that have no assurance on the protection of their intellectual property rights, assets or financial investment. When a country or company are not able to copy or imitate foreign items, products or services or technologies then the natural business interest of those foreign firms are most unlikely to be threatened in any way hence the intellectual property rights protection would not be necessary. China has a very strong capacity to copy and imitate most products and services from foreign countries. The partial outsourcing and the retainment of critical functions of the management are reviewed by the HR who advices the top management effectively.
To conclude, Outsourcing these services may eventually be economical and convenient for an organization. The main company does not have to grapple with the problems of staff welfare, employee absenteeism, strikes or unions. These problems are handled by the subcontracted companies. The major challenges facing these companies are the issues of human rights and the workers working conditions. However, outsourcing practices or trends will certainly increase in most industries in future. Currently, it would be wise for most Companies including the companies managed by Lynne and Illa, to outsource noncore production functions and retain the critical sections. These are the only options available to the two apparently.
Reference
Bardhan, A.D. and Kroll, C. (2003) “The New Wave of Outsourcing”). Fisher Center for Real Estate & Urban Economics. Fisher Center Research Reports.
Miller, P. (1987) Strategic Industrial relations and Human resources Management: Distinction, Definition and Recognition. Journal of Management Studies, Vol. 24 No. 4, pp. 347-61
Woodall, J., Scott-Jackson, W., Newham, T. and Gurney, M. (2009), “Making the decision to
Outsource human resources”, Personnel Review, Vol. 38 No. 3, pp. 236-52.
Van, D. (1998) Manufacturing Practices of the Footwear industry, UNC – Chapel Hill.
Balakrishnan, K., Mohan, U. Seshadri, S. (2008) Outsourcing of front-end business processes; quality, information, and customer contact, Journal of Operations Management, Vol.26 No. 2 pp 288-302.
Last Completed Projects
| topic title | academic level | Writer | delivered |
|---|
Are you looking for a similar paper or any other quality academic essay? Then look no further. Our research paper writing service is what you require. Our team of experienced writers is on standby to deliver to you an original paper as per your specified instructions with zero plagiarism guaranteed. This is the perfect way you can prepare your own unique academic paper and score the grades you deserve.
Use the order calculator below and get started! Contact our live support team for any assistance or inquiry.
[order_calculator]