The idea of outsourcing is one that is commonly understood. Most of us have heard about the outsourcing of goods and services to other countries, and some of the controversies that are associated with those activities. The textbook identifies the following three different types of outsourcing activities:
1. Strategic Partnership - An example of a strategic partnership could be an organization that has identified that it no longer chooses to make network management one of its core activities, and would prefer to pay someone with expertise in this area. In a strategic partnership, the organization develops significant dependencies on its outsourcing partner, in providing essential services to the organization. Some organizations have developed outsourcing relationships for things like customer support and network management, only to find that the cost savings did not justify that loss of control over the quality of these activities. Other organizations have found these relationships to be effective.
2. Co-sourcing Alliance - An example of co-sourcing might be an organization that has decided to implement an ERP (enterprise resource planning) system. This is an activity which is project-oriented, is of limited duration, and requires expertise that an organization may not necessarily want to possess over the long term. It is common for an organization to enter into a co-sourcing, or consulting, relationship with a firm that possesses staff who, through experience as co-sourcing partners, have developed the expertise necessary to assist the organization in meeting their project goals.
3. Transaction Relationship - Transaction relationships are similar to strategic partnerships; however, they are more narrowly focused. Examples of such a relationship might be the outsourcing of payroll, or debt collection. When an organization outsources development of a co-sourcing alliance and its own internal ERP system, is is seeking a transaction relationship.
The level of maturity that exists within an organization plays an important role in determining whether or not outsourcing is an effective approach to managing part of a business. For your project organization, you are asked to identify and recommend potential areas where one or all of these outsourcing models might be appropriate. You will also be asked to support those recommendations with the logic that you used to determine that this is the best direction for the organization to follow.
Using enterprise architecture to assist in the decision-making process, write a short paper in which you do the following:
Determine activities that you believe would be appropriate for outsourcing.
Explain your rationale for the stated recommendations.
Explain the financial impact associated with the stated recommendations.
Explain the legal considerations associated with the stated recommendations.
Explain the benefits associated with the stated recommendations.
Follow APA style and formatting guidelines for references and citations, and create a document that is clearly written and free of grammatical errors.