Friday, August 11, 2006

Dangers to Outsourcing

There are certain dangers to outsourcing. One of the most prominent is the exposure of sensitive data to foreign countries. It may not just be the question of data – even secret organizational tactics and managerial strategies may be exposed that could prove to be detrimental to the parent company. There may also be dangers relating to restrictions and dissimilar legislations in the offshore country that sometimes require changes in business policies. Outsourcing is also responsible for the distance it creates between the employer company and the employees. This deters the employers from building good rapport with their employees.

Outsourcing may be a way for a company to lay roots in a foreign country where they may be thinking of expanding. Hence, a company may outsource its business to a company in India in order to understand the prevailing Indian market and to adjudge the Indian customer. This may be a ploy to sooner or later open a branch in India. Huge conglomerates that are perpetually expanding opt for outsourcing as a survey method rather than as a method for garnering more business.