1. Location location location!
Business and Management

2. Outsourcing/subcontracting
The act of transferring internal business activities to an external organization to reduce costs and increase productivity.
Outsourcing/subcontracting

4. Advantages of outsourcing
Jobs that are not core functions of the business can be outsourced to third parties. This allows the business to concentrate on what it is best at doing.
Quality stays high because the third party specializes in the outsourced activity.
Helps cut production costs and leads to higher productivity.
Advantages of outsourcing

5. Limitations of outsourcing
There must be clear communication and trust between the 2 parties. If there is a conflict it could potentially cause problems for the business.
Allowing subcontractors to have control over the quality of products can cause concerns.
Outsourcing still requires effective communication and effort.
It can cause uncertainty among the workforce due to restructuring and staff reductions.
Limitations of outsourcing

6. This is an extension of outsourcing which involves relocating business business functions and processes overseas.
Offshoring

7. Tutor2u

8. Advantages of offshoring
* There are the same advantages as outsourcing. * Also helps businesses avoid trade protectionist measures. (tariffs, quotas)
Advantages of offshoring

9. Limitations of offshoring
Unethical practices in other countries can hurt business.
Quality assurance is harder to control because of the distance.
Vulnerability to the economic and political influences.
Limitations of offshoring

10. Production offshoring
Manufacturing
Production offshoring
(manufacturing)

11. Service offshoring

12. The use of an organization’s own people and resources to accomplish a certain function or task which would otherwise have been outsourced.
Insourcing

13. The business outsourced a task but the quality has declined and they are no longer satisfied.
There are no longer cost saving benefits involved from using a subcontractor.
Why insource?