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Covers the definition of outsourcing, introduce some reasons why a business might choose to do
Introduce several reasons for a business to outsource its products, introduce the two main
approaches: quantitative and qualitative.
Definition, reasons, etc.
Uses Harvard business case study to identify quantitative elements. Description of each process
and reasons for choosing the framework.
Talks about which industry often relies on outsourcing.
Analysis of current events:
Identify companies which have often relied on outsourcing and how they have succeeded.
Wraps up the whole paper by identifying the main points.
Quantitative and Qualitative Managerial Decision Making- Best Practices
Outsourcing is defined as a practice which allows a company to hire another company or
individual to perform tasks which they specialize in and have had experience in before.
Outsourcing is a common practice carried out by businesses, especially big firms. Throughout
the world, this practice has a market of around $279 billion and is projected to have a growth rate
of 25% annually (Lacity 2011). Outsourcing has become a strategy that companies use to
transform their cost structures overnight, by converting both variable and fixed costs into purely
variable costs. Since a firm’s goal is to maximize profits by minimizing costs, they are often
faced with the dilemma of whether to practice outsourcing or engage in the “do it yourself” act,
in which they perform the tasks themselves and not have to rely on other companies. Whether or
not a business decides to outsource their operations requires a lengthy quantitative and
qualitative analysis to steer them towards the right decision.
Reasons Businesses Outsource
There are two primary reasons that businesses participate in the process of outsourcing. First, a
business might seek to engage in outsourcing if doing so would result in a reduction of their
costs. This way, if their production costs are minimized, their profits would increase, regardless
of whether or not ...
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