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Work Outsourcing: New Incentives Outsourcing of Work It is a matter of fact that many companies nowadays are outsourcing and continue to outsource work in other countries. It is the evidence that outsourcing is successful, because it increases the quality of product and lower costs. There is a suggestion that outsourcing is is a form of technological innovation analogous to machines on a car assembly line. There are many positive moments concerning outsourcing. Firstly it is necessary to define main advantages of outsourcing: The ability to purchase intellectual capital The ability to concentrate on core competencies The ability to anticipate the future costs better The ability to lower costs (Reh 2003) Although outsourcing is developing nowadays it id faced with a number of problems and negative moments. The most disputable moments are quality of service, labor and economy, security, etc.
it is admitted that there are less opportunities for agents to show work ethics and loyalty. The quality of service and technical support are told to be significantly lower compared to that of the in-house. There are also compliance's that outsourced services are more expensive and worse. It is real problem that outsource companies are not able nowadays to meet the required standards of quality.
For example, managers working in outsourced companies assume that all of them are similar and they underestimate the service needs. Therefore the first problem is lackluster quality of service and technical support. Such service is considered to be additional negative surprise. (Reh 2003) It is also suggested that outsourcing jobs abroad is like avoiding payment of taxes. The second problem is that outsourcing revolves around the costs associated with transferring control of labor process to an external entity in another country. It means that outsourcing significantly hurts the countrys economy. It is also mentioned that government has to impose legislative measures against companies which transfer jobs abroad.
There are some suggestions that it is necessary to increase taxes on outsourcing companies. It appears that outsourcing companies are threatening the livelihood of domestic employees. There is an idea that outsourcing is analog of dumping. It is seen that outsourcing is faced with criticism and many problems. But it is apparent that outsourcing has advantages and benefits. It means that outsourcing has to be provided with new tax breaks and new financial incentives for future development. (Reh 2003) New Incentives It is necessary to say that outsourcing companies have to provide financial incentives in order to attract and to motivate the potential customers.
The possible ways are bonuses and penalties, pain sharing and gain sharing. But incentive has to be radical in order touch potential customer emotionally. It is necessary to make desires real. For example, partners may bet their own money on the outcome. It is apparent that both companies are risking and they both have rights to share success if the strategy pays off. One of the possible ways is to help, for example, Italian financial firm to implement transformations to a full-service bank within a year.
And there appears a question: how was the service paid? Everything is simple: the company receives a percentage of the assets under management. And then the more successful the bank is the more profit it has. (Linder 2003) Outsourcing companies say that outsourcers ensure that real incentives flow directly into the hands of key individuals. It means that companys leaders have to provide additional bonuses, promotions, raises and actually recognition for the employees involved in the process. As the example of development plan it is possible to use starting television service provider. Lets call it Telex.
On this example the main steps of development will be shown. Telex is aimed at developing distinctive and outstanding customer-support capabilities in the very beginning. Telex Company has firstly to realize that the first step of success is developing unique product with unusual needs. The future success would depend mainly on providing help to customers concerning installation, understanding and using the device. (Linder 2003) But scripts of call centers are not enough. The next step is to prepare agents in outsourced call centre for possible challenges and problems.
It can be achieved if to work closely on establishing of call-handling process. It is important to focus on developing innovative materials of personnel training. It would be rather positive to allow employees to use the devise at homes. It would give them direct incentive, because they would think they are Telex customers. Finally Telex outsourced centre would master the open-ended dialogues and would solve main problems needed to provide the real customer solutions. One more key to success is to provide agents with additional awards, bonuses, lower prices and discounts. (Linder 2003) It is necessary to add that the other keys to success are: to sustain high-commitment relationships, strategic governance, contract negotiations and actually personal relationships.
The incentive has to be outcome-oriented. It is possible to use conventional measures, but in a completely new way to concentrate mainly on possible performance and on increasing quality of service. Incentive should be based on aspirational goals. Companys executives have to structure a balanced scorecard and in such a way to ensure firstly short-term progress involving service levels, quality and standards levels, process improvements, innovations and providing cultural fit. For example, it is possible to implement quarterly presentation of new incentives and ideas.
Service levels must meet customers demands. In conclusion it is necessary to say that combination of all mentioned aspects will lead to companys success and future development. (Linder 2003) Works cited Linder, Jane. Transformational Outsourcing: How to Use Radical Methods to Achieve Rapid, Sustainable Gains. Business Performance Management (2003, June). [Available at web Reh, John. Outsourcing Companies: Benefits and Criticism. 2003. [Available at web
Free research essays on topics related to: quality of service, financial incentives, future development, technical support, lower costs
Research essay sample on Work Outsourcing New Incentives
