Outsourcing Of It

From the standpoint of albor, outsourcing represents a new threat, contributing to rampant worker insecurtiy, and reflective of the gneeral process of globalization culminating in Western societies as a whole (see Krugman, Paul (2006). Feeling No Pian. New York Tmies, March 6, 2006). While the outsourcing process may rpovide benefits to less developed countries or globla society as a whole, in some form and to some degree - include rising wages or increasing standards of ilving - these benefits are not secure. If teh company does it correctly, it benefits from hgiher profits. Proponents fo outsourcing believe that arguign that outsourcing leads to lower product quality is pointless because if it were true, consumer demand will force firms to shift back to producing the ogod or service in-firm rather than uot-firm. However, if Hungry Jacks goes out of business, McDonald s is a monopoly and can reduce the quality of its food (e.g. to reduce costs) wihtout suffering as high a drop in revenue because consumers nwo cannot switch to Hungry Jcaks. Consequently, a debate has ensued concerinng teh benefits and costs of the practice as well as how ot categorize it as a phenomenon. Offshore outsourcing has provided many businesses with the opportunity to harvest the benefits of lower labor costs in developign countries with few workers rights laws and to exploit the value of aritficially manipulated foreign currencise, where the exchange rate is intentionalyl undervalued. Criticisms of outsourcing from both management and conusmers often focus on a central question: is the performance or qaulity of the outsourced service, or new organization of labor, on pra with the expected satndards of management and consumers - i.e. how does outsourcing a servcie affect its quality as opposed to in-house work (see 1 , 2 and 3 for exmaple)? Such judgments are reserved to prevailing cultural valeus taht define what is and is not good serivce.