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Human Resource Management

Notes Outsourcing and Off shoring

Outsourcing is the force behind the virtual organization movement. Outsourcing is simply
obtaining work previously done by employees inside the company from sources outside the
company. If someone has specialized in an activity-which is not strategically critical to our
business and is able to do that cost-effectively, it is better to get it from outside. One get benefited
in the form of excellent quality, reliable supply and rock bottom price. One can also focus
exclusively on doing what you are good at (the so called mission critical activities)-thereby
enhancing your own competitive advantage. For example, Dell outsources the manufacture of
its computers. It concentrates all its efforts on enhancing its Web-based direct sales capability
and does not dilute its energies on other aspects of the game. Companies such as Nike and
Reebok have succeeded by focusing on their core strengths in design and marketing and
contracting all their footwear manufacturing to outside suppliers.
Outsourcing is changing the way HR departments operate as well. Technology makes it easy to
outsource HR activities to specialist service providers, by allowing service providers real time
internet based access to the employer's human resource information database. Payroll, benefits,
applicant testing and screening, carrying out reference checks, exit interviews, employee training,
etc., are some of the popular human resource tasks that are being outsourced currently. Companies
are outsourcing more HR activities nowadays because the transactional functions could be
turned over to a service provider – with a process and technology expertise – and the core
company can concentrate its efforts on strategic acquisition, motivation and retention of talent
which by all means is critical to business success.
Off shoring (also known as global sourcing) refers to the movement of jobs overseas. For
example, in an age of cheap telecommunications, almost any job-professional or blue collar-can
be performed in India for a fraction of U.S. wages. MNCs are forced to indulge in this kind of
'labour arbitrage' and remain ahead of competition. Cost reduction is the overwhelming
motivation for doing so.

Workforce Diversity

Diversity may be defined as the situation that arises when employees differ from each other in
terms of age, gender, ethnicity, education, etc. The term 'diversity' as we use the term in 21st
century is far more than skin, colour and gender. It refers to multifarious differences including
religious affiliation, age, disability status, sexual orientation, economic class, educational
background, and life style in addition to gender, race, ethnicity and nationality.
Diversity can turn out to be a big liability in the hands of a manager who is not sensitive to the
needs, concerns and expectations of a diversified work group. It can pose lot of problems when
a particular section of employees feel neglected or bypassed. The perceived inequity might
reside only in the brains of some who might have been pushed to a corner on grounds of poor
performance.

Work Life Balance

This is the age of hectic schedules, high pressure work assignments and deadly targets. You have
to race against time to get noticed and be in the reckoning. Otherwise you will be hanged to
death with a tag around your neck: “ poor performer”. The 21st century has changed the lives of
executives, more or less, permanently. They seem to have been thrown out of gear completely,
especially their private lives, -thanks to factors such as the intense competitive environment, the
invasion of information technology and the race to- be- the- first and be- the- best type of
performance culture work life balance before things take an ugly turn, there is an urgent need to

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