Offshore Cases and Google Problems
Question 1 "The Offshoring Debate in a Small Organization" by Benny Sisko
Many people imagine only enormous Fortune 500 companies as moving production and jobs overseas. However, in today's weakened economy, even smaller businesses are now opting for outsourcing more and more to keep costs low. Even smaller companies have to deal with complex issues that are normally thought to be dealt with by larger Fortune 500 companies. Yet, despite benefits, there are also high risks involved in outsourcing, risks that go far beyond the boundary of the single organization in questions.
There are a number of major benefits of outsourcing. Smaller companies can dabble in outsourcing, but often not so much in offshoring, which often requires higher initial costs despite the overall costs savings (Kumar & Salzer 2010). Essentially, outsourcing focuses on using lower labor costs to get production done in other countries where costs are not as high as the United States (Stuart 2011). Outsourcing is becoming increasingly less expensive as more and more companies are jumping on board and influencing foreign manufacturers to keep prices low. Some small businesses may have no choice but to outsource, while others do it to save costs and increase profit margins (All Business 2008). Here, the research states that "Outsourcing converts fixed costs into variable costs, releases capital for investment elsewhere in your business, and allows you to avoid large expenditures in the early stages of your business," (All Business 2008). It also increases overall efficiency of both production and the running of the organization as a whole.
However, there are costs associated with potentially furthering damage to the American economy. It is within this aspect that many believe small businesses and other organizations should exude a strong sense of social and corporate responsibility, thus keeping production local despite the potential for small decreases in profit margins. Therefore, the research suggests begs the question: "Do American corporations and other organizations, including non-profits, hospitals, and colleges have a social responsibility to help keep the overall U.S. economy strong even if it means pressure on profits?" (Sisko 2009). Many believe that the increasing trend for outsourcing is having a damaging impact on an already weakened American economy. In this regard, "Critics claim that outsourcing places the corporate interests of the company and its shareholders over the job security of domestic employees leading to a detrimental effect on the local economy," (Reddy 2008). Moreover, American creativity and ingenuity is often at stake when IT and other technical needs are outsourced. This could place technology in danger of pirating. With fewer restrictions on copywriting in many of the nations we now outsource to, like China, sensitive and innovative technologies can be at risk for illegal copying. Many of the nations that work with outsourcing have been slow to set up greater restrictions and regulations in regards to protecting copyright and other forms of creative capitol. Moreover, there is a loss of managerial control that could result in lesser quality control regulations (Bucki 2011). When managers are not present to have a strong impact in the production process, negative results can often follow. Essentially, without a more watchful eye from organizational representatives there in person, quality can suffer significantly. This can also lead to a lowering of consumer reputations, as customers begin to see the quality of certain brands and products decline.
Overall, it is clear that outsourcing, although with some benefits, does play more into creating more of a problem than a solution. In today's weakened economy, outsourcing is only a quick fix that tends to increase the level of erosion going in behind the scenes in the American economy. Therefore, smaller organizations can do their part by keeping projects and production on American soil.
Question 2 "Google's China Problem (and China's Google Problem)" by Clive Thompson
In an era of corrupt business deals, Google has long stood out as one company that refuses to sacrifice its ideals for profit. Google is trying to "bring information to the masses," without compromising its primary goals of putting the user first in order to provide them with free and accessible information (Thompson 2006). Thus, Google has earned a stellar reputation from its international consumer base. Yet, this is now being threatened by its operations in China.
China is a massive country, with millions of possible internet users that could plump up Google's international profit intake. Thus, Google had spent great effort and finances in developing...
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