Outsourcing a Division

User Generated


Business Finance


Assume you are a strategic leader in a large international manufacturing organization. The organization has experienced a significant loss in revenue over the last two years; now you must consider outsourcing a division to another country in order to reduce expenditures and sustain the company for years to come. Given that your role as a strategic leader is to focus on long-term planning, you must ensure that your decision making is effective and will meet the overall organizational goal of sustainment. Thus, address the following:

  • Describe the steps you would take in evaluating the decisions to be made in this situation.
  • Explore whether or not you would use prescriptive or descriptive decision making.
  • Explain your reasoning for the type of decision making you selected.
  • Evaluate the critical thinking skills you think are necessary to make this decision.

The focus of this assignment is on the steps that you would take as a leader while going through the decision-making process, rather than the actual decision that you would make.

Assignment Requirements:

  • Cite a minimum of four scholarly sources to support your positions, claims, and observations, in addition to the textbook, three of which should be academic, peer-reviewed sources
  • Your assignment should feature a PowerPoint slideshow that includes 9-10 slides, not counting the required title and references slides. If you do not have access to PowerPoint, you may use a program such as Google, SlideRocket, Prezi, or another software application to create your presentation. Embed voice narration in your presentation, or follow the directions above for a written script and submit it separately. Familiarize yourself with the program you choose early in the process.
  • Your slides must feature content in the Notes section that elaborates on your bullet points.

Additional Requirements :

  • Your presentation should be 9-10 double-spaced slides including introduction and conclusion.
  • Remember, you must support your thinking/opinions and prior knowledge with references. Incorporate two scholarly references
  • In-text citation used throughout the assignment and APA-formatted reference list.
  • Please no plagiarism and sources should not be older than 5 years.
  • Include headings organize the content in your work.

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Explanation & Answer




Outsourcing is the transfer of the operations of a division in a
company to a third-party service provider.

It is designed to have positive impact on bottom line due to reduced
overhead cost and increased rate of innovation.

Managers that are given the responsibility to outsource the

operations of their organization to an international destination must
consider savor factors (Singh, Narain, and Yadav, 2009),

While outsourcing remains one of the effective strategic management
approaches for accomplishing organizational objectives, the use of
inappropriate decision-making models can limit the potential of these

Steps for Evaluating the Decision to Outsource

While outsourcing present new ways of accomplishing business
objectives, some steps are critical to making the right decision.

First, the manager must articulate how the outsourced business
process would advance organizational strategy.

In this context, consider would be given to the benefits related to cost
savings, efficiency, and improvements of product quality (Divekar,
Bangal, and Sumangala, 2012).

Second, consider the cost implications regarding disruption of
business operations due to political instability, labor disputes,
infrastructural deficiencies, and disasters including natural and


The third consideration is the evaluation of the human resource
capability of the destination to support the long-term dimensions of
the outsourcing decision.

Are there sufficient skilled and talented workers in the destination

that aligns with the cost-saving strategy of the business?

Fourth, consider the cultural compatibility index of the selected
outsourcing destination (Kvedaraviciene and Boguslauskas, 2015).

Are the customers and internal stakeholders comfortable with doing
business in the destinations? Will language and cultural practices
impact the reputations of the business?


An evaluation of the availability and reliability of the technology
infrastructure in the selected location is the next step in the
decision-making process.

In this regard, it is important to consider the frequency of
downtime, its impact on business operations, and business

continuity procedures for systems failures (Kvedaraviciene et al.,

Finally, assess the maturity of the legal system regarding the
protection of intellectual property rights, especially when the

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