Outsourcing Business Research Paper Example | Topics and Well Written Essays - 2000 words - 1

Outsourcing Business - Research Paper Example Ang and Inkpen (2008) argue that since 2002 offshoring activities have increased significantly, not restricted to only IT sector, but it has gone beyond that in the field of business process outsourcing (BPO), legal outsourcing (LO), infrastructure outsourcing (IO), knowledge process outsourcing (KPO), and many more. In 2000, total offshoring business was estimated at the US $119 billion; however, by 2008, that increased significantly to the tune of US$ 300 billion. In 2011, the US companies outsourced 2,273,392 jobs and as much as 35 percent of the companies consented that they had been outsourcing at least one of the processes. While segregating outsourcing in the services, it has been found that 43 percent of the companies in the IT sector in the US resorted to outsourcing; while in R&D and distribution services, sector outsourcing percentages are found to be 38 percent and 26 percent respectively (Statistic Brain, 2012). Lewin (2012) argues that emerging economies occupy a large pie of global offshoring business promoting overall economic development as the US companies do not mind offshoring nine or more time zones away despite the presence of near-shore delivery centers. This clearly implies that offshoring has been accepted across mid and large sized US companies for varied reasons and it is going to stay and grow in the future bringing new waves of economic development across the globe. From the above exhibit, it is quite clear that cost reduction and unavailability of IT skills were the main reasons for the companies to outsource. Freeing up internal resources and improving customer focus were two other major reasons for the outsourcing given by the companies. Global offshoring IT and BPO market is huge but its evolution has been dependent upon the three factors: Supply quality; timely delivery; and adopting the actions.