Make or Buy decision: Outsourcing - A successful method to reduce costs in business processes of international companies?

Alexander Merl, Manfred Husa

• Publisher: GRIN Verlag
• Year: 2006
• eBook ISBN: 9783638535410
• Edition: 0
• Topic: Business
• Subtopic: Management
• Index: Business

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, 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.