Please, respond to the attached classmate discussion posts (250 words each). Thanks
Please, respond to the below classmate discussion posts (250 words each). Please, respond to the below two classmate main posts. (Please, the responses need to be a discussion, not an evaluation. You can agree with them and add information regarding the topic discussed. No citation required) Thank you Classmate discussion posts Discussion 1 Maria Valenzuela Overall, outsourcing is a good idea when you manage an international business. Outsourcing is especially beneficial when having a technology company as it becomes vital to bringing in specialists from different countries that you might not find as easily in your own. Furthermore, it is cheaper to purchase parts for a computer or cell phone, as manufacturing these pieces in countries such as China or India can lower the costs of the company in the U.S. Moreover, companies for example may also find it beneficial to outsource services by having call centers to help clients with billing and other customer issues in countries where labor is cheaper as this can also minimize the company’s costs. According to Novik, 2017, “one of the positive effects of outsourcing is that you don’t have to pay taxes. So, you spend less money. Freelancers that will work for you will be hired by the agency and not by you so that you won’t deal with any bureaucratic aspects of your cooperation. Here are 5 top reasons why outsourcing is good: it lowers your costs, you can hire specialists from another country, you can use it in any niche of the market, you avoid all bureaucratic aspects, you can hire one person or a group of experts.” On the other hand, it is important to create and keep jobs in our country as this maintains a healthy economy, that is why it is essential for an international company to manufacture some components in-house and not just outsource everything because it would be cheaper. If we continue with the technology companies it would be important to measure and stablish if the country where the company is located can manufacture most of the item parts or what country has better technology. However, there are a few negative effects of outsourcing -besides that it would take jobs to other countries- that are important things to consider, and these include: “lack of control, although you can provide direction in regard to what you need to accomplish, you give up some control when you outsource. Communication issues, this doesn’t always come into play, but it’s one of the biggest potential drawbacks. Problems with quality, despite all the benefits of outsourcing, it is only a good thing if you’re receiving the quality you expect. Anything less than this will be a disappointment. Impact on company culture, as a business owner, it’s easy to focus on the benefits of outsourcing, all without considering the impact it can have on your company as a whole” (Patel, 2017). Before a company decides on outsourcing and what products and or services would be outsourced, it is necessary to take into consideration all the possibilities, including the negative aspects so it does not affect the company’s culture, vision and mission. After all, if all employees are comfortable and happy being part of the company, they will have a higher level of productivity, and the economic impact will be reflected with this too, not only by outsourcing to reduce costs for the company. Reference: Novik, O. (2017, August 7). Is Outsourcing Good or Bad for Your Business? Retrieved from: https://wow24-7.io/blog/is-outsourcing-good-or-bad-for-your-business Patel, D. (2017, July 17). The pros and cons of outsourcing. Retrieved from: https://www.forbes.com/sites/deeppatel/2017/07/17/the-pros-and-cons-of-outsourcing-and-the-effect-on-company-culture/#54a6a0c5562d Discussion 2 Alexis Nunez The decision to manufacture in-house “make” and which to outsource to independent suppliers “buy” is made at both long-term strategic and short-term operational levels. The two most critical factors that determine whether to make or buy are cost and production capacity. Cost issues include things such as raw materials, component parts, and other inputs into the process, along with the costs of finishing the product where production cost is presented as an opportunity cost (Hill & Hult, 2019). Ultimately, decisions need to be assessed individually to determine which to go with, and if both seem like a good fit then go with the one that is the best long-term strategic fit and has the least short-term opportunity cost. The decision to produce at a broad level deals with product success, specialized knowledge, and strategic fit. The elements that favor in-house production aside from the cost and production capacity would be “quality control, proprietary technology, having control, excess capacity, limited suppliers, assurance of continual supply, and industry drivers” with the limitation being the need to have excess production capacity or capacity that is best used to produce in-house (Hill & Hult, 2019). Some of the same elements that favor making a product can also influence whether to outsource. When in-house manufacturing is not favored by one of the elements, this would trigger the company to consider outsourcing. Like the decision to make, the decision to buy would also consider the cost and production capacity. Additionally, operations favoring buying decisions would include elements such as multisource policy, lack of expertise, supplier competencies, small volumes, inventory planning, brand preference, and nonessential item (Hill & Hult, 2019). Outsourcing is good if it can lower costs to make a higher profit. The outsourcing industry has become a multi-trillion-dollar business worldwide and is known to deliver economies of scale, improve efficiency, cut costs, offer flexibility, and increased productivity by allowing focus on core competencies (FESPA, 2015). According to Forbes, the advantages of outsourcing consist of not needing to hire more employees, gain access to a larger talent pool, lower labor costs (Patel, 2017). Despite the benefits of outsourcing, some of the drawbacks of it are a lack of control, hidden or additional costs, security risks, communication issues, and issues with quality. Additionally, the decision to outsource has created issues with job placement in domestic countries and can create issues that can affect corporate culture both positively and negatively. Ultimately, while it sounds like a good choice, the determination of whether outsourcing is good or not is something that has to be carefully weighed to see whether or not it is a good fit for the company. References FESPA. (2015, July 01). Why is outsourcing a good business strategy? Retrieved from FESPA: https://www.fespa.com/en/news-media/features/why-is-outsourcing-a-good-business-strategy Hill, C. W., & Hult, G. T. (2019). International Business. McGraw-Hill Education. Patel, D. (2017, July 17). The Pros and Cons of Outsourcing. Retrieved from Forbes: https://www.forbes.com/sites/deeppatel/2017/07/17/the-pros-and-cons-of-outsourcing-and-the-effect-on-company-culture/#31f70be7562d