2.2 Other issues Management need to consider a number of factors before deciding to outsource.
§ Continuity and control of supply. Can the outside company be relied upon to meet the requirements in terms of:
- Quantity
- Quality
- Delivery dates
- Price stability
- Security.
Note – there are a variety of methods available to improve the chances of standards being met or surpassed. These usually involve gearing the level of reward to the level of standard achieved.
§ Specialist skills:中 华 考 试 网
- Does the external supplier possess specialist skills in this area of work that are not available in-house and which add to the quality of the product or service?
§ Alternative use of resources:
- Can the resources used to make this article be transferred to another activity which will save cost or increase revenue?
- For example, will valuable skilled staff be who could be usefully deployed elsewhere in the business, be freed up
- Does the article require substantial in-house expertise which will be lost if it is outsourced?
§ Social/legal
- Will the decision affect contractual or ethical obligations to employees or business connections?
- Potential difficulties in agreeing and enforcing contract terms.
- The length of the contract (the risk of being ‘lock in’).
§ Confidentiality
- Is there a risk of loss of confidentiality, particularly if the external supplier performs similar work for rival companies.
§ Operational gearing
- Would outsourcing enable overheads to be reduced?