Bus 630: Managerial Accounting
Outsourcing
BUS 630: Managerial Accounting
Outsourcing
The pros and cons of outsourcing varies by industry, size of organization, organizational structure, and many other components. The pros and cons are highlighted and the fall of Satyam to encompass a full range of accounting aspects. All size organizations outsource a portion of his or her business. Therefore, taking time to reflect on the points identified in this paper may enlighten or create ideas for consideration regarding outsourcing.
Outsourcing is the process of an organization transferring part of services or product development to a third party. Outsourcing is utilized to reduce cost, increase quality, fulfill staffing resources, reduce fixed costs, and increase profit …show more content…
In the United States volumes of research have been conducted with a range of 300,000 to a projected 1.4 million will be lost to outsourcing. However, the research cannot identify the exact amount of jobs lost to outsourcing or natural progression and technology advancements (Gorg & Hanley, 2004).
A United Kingdom study reveals more than 68% of organizations outsource a portion of products or services offshore. The same study indicates more than 50% of information technological work outsourced was below par. Additionally, more than 10% of work outsourced hampered production and profits. The research clearly projects outsourcing and profitability is realized on large businesses. Small businesses will not profit or meet standard criteria for outsourcing jobs (Gorg & Hanley, 2004).
Some of the concerns people have in the United States is India and China will continue to take away more jobs. The jobs in information technology currently outsourced primarily require a college education. India and China have an average of six percent attending college between the ages of 18 and 24. Nonetheless, less than one percent of the six percent speak English. Other things to …show more content…
Outsourcing provides an increase in operating efficiency, higher return on assets, and increase in profits. Outsourcing can provide new revenue streams with fewer risk and lower collateral investment (Gnusche, Wallace, Wilson, Smith, 2004).
The make or buy analysis is a fast way to determine whether to in-house or outsource. Make or buy decision method can use full costing, incremental analysis, or variable costing. Full and variable costing process occurs when income statements are prepared. Income statements are not quickly prepared. The main goal is to decide if making or purchasing a product or service is cost-effective. Another aspect of making or purchasing is outsourcing does not incremental revenue. However, it does allow incremental costs, reduction in fixed costs, and potential savings. The potential savings will materialize in direct labor, material costs, and variable overhead costs (Noreen, Brewer, & Garrison,
BUS 630: Managerial Accounting
Outsourcing
The pros and cons of outsourcing varies by industry, size of organization, organizational structure, and many other components. The pros and cons are highlighted and the fall of Satyam to encompass a full range of accounting aspects. All size organizations outsource a portion of his or her business. Therefore, taking time to reflect on the points identified in this paper may enlighten or create ideas for consideration regarding outsourcing.
Outsourcing is the process of an organization transferring part of services or product development to a third party. Outsourcing is utilized to reduce cost, increase quality, fulfill staffing resources, reduce fixed costs, and increase profit …show more content…
In the United States volumes of research have been conducted with a range of 300,000 to a projected 1.4 million will be lost to outsourcing. However, the research cannot identify the exact amount of jobs lost to outsourcing or natural progression and technology advancements (Gorg & Hanley, 2004).
A United Kingdom study reveals more than 68% of organizations outsource a portion of products or services offshore. The same study indicates more than 50% of information technological work outsourced was below par. Additionally, more than 10% of work outsourced hampered production and profits. The research clearly projects outsourcing and profitability is realized on large businesses. Small businesses will not profit or meet standard criteria for outsourcing jobs (Gorg & Hanley, 2004).
Some of the concerns people have in the United States is India and China will continue to take away more jobs. The jobs in information technology currently outsourced primarily require a college education. India and China have an average of six percent attending college between the ages of 18 and 24. Nonetheless, less than one percent of the six percent speak English. Other things to …show more content…
Outsourcing provides an increase in operating efficiency, higher return on assets, and increase in profits. Outsourcing can provide new revenue streams with fewer risk and lower collateral investment (Gnusche, Wallace, Wilson, Smith, 2004).
The make or buy analysis is a fast way to determine whether to in-house or outsource. Make or buy decision method can use full costing, incremental analysis, or variable costing. Full and variable costing process occurs when income statements are prepared. Income statements are not quickly prepared. The main goal is to decide if making or purchasing a product or service is cost-effective. Another aspect of making or purchasing is outsourcing does not incremental revenue. However, it does allow incremental costs, reduction in fixed costs, and potential savings. The potential savings will materialize in direct labor, material costs, and variable overhead costs (Noreen, Brewer, & Garrison,