Make or Buy decision: Outsourcing - A successful method to reduce costs in business processes of international companies?
Seminar paper from the year 2006 in the subject Business economics - Business Management, Corporate Governance, grade: 1,7, University of applied sciences, Neuss, course: International Management, 67 entries in the bibliography, language: English, abstract: During the last years international companies dealt with the question of optimal division of labour in cooperation with suppliers; especially in the automotive and supply industry. This question and its solutions decide of the competitive position of many companies in several industrial sectors. Major points in regard to division of labour are the areas of manufacturing-, quality-, logistics- and development functions. Such procedures create qualitative relationships between the parties involved. Another question concentrates on the maintenance or the change of company internal services e. g. cleaning, car pool, human resources, canteen and accounting. Although the core services of the companies remain the same, in these areas total cost reductions as well as flexible processes can be achieved. The process of optimal division of labour to be achieved by giving away internal functions to an external service provider, in economic literature is called outsourcing. Generally, corporations use outsourcing to target on cost-, flexibility-, time- and quality aspects.
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advantages analysis Berg Betriebswirtschaft business units buy decision call centres chances and risks Chances of outsourcing chapter command and control competitive position contract conclusion cooperation cost aspects Coutsourcing.asp?hm=1&um=O Czech Republic Dietl evaluation ex-ante transaction costs Ex-post transaction costs example exist external service provider Feenstra Fichtel & Sachs Fischer flexibility Franck functions Furthermore Hammes haulier Heinzl Hopfenbeck http://www.aib.wiso.tu-muenchen.de http://www.euroframe.org/fileadmin/user_upload/euroframe/efn/spring2005 Hungary increasing Information asymmetry institutional economics international companies international outsourcing activities Jost June know-how Koppelmann Kreiner labour level of service materials Matje minimise Moreover negotiation optimisation ordering company ordering party organisation outsourced warehouse outsourcing contract outsourcing Figure outsourcing process paper Pejovich percent Picot points listed Poser principal agent theory principal’s problem production reduction regard result risks of outsourcing Romania Schneider Schweinfurt securing of supply shows specialisation strategische Stuttgart suppliers system of command term outsourcing transaction cost theory transfer Types of outsourcing w.a. http://www.sachs-ag.de Wiesbaden Williamson workers council