Unit 4 Project 1

BUS105 Unit 4 Individual Project

Raven S. Benson

BUS105: Business and Society

Even Alexandra A. Clausen

November 1, 2009

Unit 4 Project 2

Offshore outsourcing is the action a business takes to move manufacturing or other

services of a business’s workings to an out of country location (Overby S., 2009). This is the

manufacturing decision that my husband and I decided to take to have our gloves manufactured.

In the short-term, the cost would be small, and it would also give us lots of free time together.

Making this choice however was no easy task, as the politics behind offshore outsourcing are

deeply embedded in hate and misunderstandings.

When it comes to offshore outsourcing that involves manufacturing, ones has to be very

careful about the choices they made overseas while setting up the plans for producing their

product. My husband and I were given a few choices on the costs and the type of workers we

would have. Little girls as young as 6 years were offered to us to make our gloves at less than 98

cents an hour (“Sweat Shops Pay Children 60p”, 2008). Disgustingly my husband thought that

would be a good idea, since it would cost less to have the children make our gloves than an adult.

At first he failed to see the legal repercussions that could arise from such labor, as well as the

unethical backings of using such labor. Eventually we were able to come to a compromise on a

factory in China that does not hire young children, and isn’t considered a sweatshop. Now, our

business has turned into a waiting game over our product.

There are quite a few pros and cons of offshore outsourcing, as discussed on

bizbrim.com, and they all should be looked at and examined before truly jumping into an

offshore outsourcing contract. Without looking over each of these thoroughly, one could be

leaping blindly into a whole new world and leaping back out of it into piled of debt and a ruined

business reputation.

Unit 4 Project 3

One pro for offshore outsourcing is new jobs open up in developing countries. This puts

money into a developing world economy; hopefully it will encourage growth and so on.

However this pro is also a con, as the jobs that are going offshore, are taking much needed jobs

away from people who deeply need them in a developed country. An example of this is America,

as companies are taking jobs such as their technical support centers and putting them in India,

Americans are losing their jobs. This problem sets a dislike of Indians into Americans who have

lost their jobs to outsourcing, making the Indians who work the phones, for let’s say Microsoft,

very difficult as Americans will sometimes just call them to insult them (Personal phone call

with Microsoft tech support, May 31st 2009).

My husband and I talked about the above pro and con, and we still decided to go with offshore

outsourcing for a few reasons that relate to the above paragraph. One reason is because it was

just me and my husband making the gloves, now it’ll be a village in another country that is

making them. No state side jobs will be lost because of us since our company hadn’t made any.

However we hadn’t made any jobs in America with our product anyways. The only people who

are poorly effect by this decision are the companies that locally we were using to buy stuff to

make our gloves.

Another pro and con of offshore outsourcing, is the independent stature of an outsourced

factory. The reason this a pro, is because the manufacturing plant can function on its own

without constant overseeing from my husband and I. However this also a con, because there is a

lack of communications, and disability to micromanage the factory if something bad arise. An

example of this would be if the factories worker were to go on strike. There would be little my

Unit 4 Project 4

husband and I could to, and the manufacturing plant’s managers would have to handle the

situation on their own. This itself would cause a hold on the production of the gloves and would

make getting a profit rather difficult.

My husband and I talked about the pro and con stated in the above paragraph, and still

continued with our decision. My husband and I are no strangers to risks, as we had just only a

few weeks ago, taken out a rather large personal loan to own the rights to our gloves (See Unit 2

IP). Of course the debt from the possible above statement would be large, however the money

made and the free time that an offshore outsourced factory frees up greatly outweighs the con.

With every plan, a backup plan is needed, and my husband and I are smart enough to

have one. We would revert back to our assembly only manufacturing system (see Unit 1 DB),

buying all our materials from local vendors, and making the gloves ourselves. However, this

time we would buy out an empty factory, and hire local citizens in the area. We would continue

to buy locally, and have employees put the products together in the factory. This is our backup

decision because it is what we know how to do, and we can do it well.

A pro and con for this decision is the price, since its high to start up, but in the long run, it

will be cheaper than outsourcing. For we will eventfully own the factory building since the

money for it came from a loan, so we will not be playing extra to manufactory our products.

However we will be paying local taxes, and higher wages than we would if we went with

offshore outsourcing.

Another pro is the ability to micromanage, since we will be right there with the factory all

the time, maybe even stepping in to make gloves ourselves if an employee is ill. This is a pro

because we’ll be able to see problems hopefully before they arise. There also will be little chance

Unit 4 Project 5

of illegal behavior happen while we’re there and watching over the production of the gloves.

This could also be looked at as a con through the eyes of the employees because they might not

take it all too well that my husband and I are always watching at the factory.

In conclusion, my husband and I are prepared and ready for almost anything the world of

manufacturing throws at us. We have plan, and a backup plan, and most of all we have each

other, and hopefully that will continue with the added time that offshore outsourcing provides. If

not, at least we will get to know each other a lot better through the world of assembly only

manufacturing.

Unit 4 Project 6

References

Exposed: Primark's fashion sweatshops that pay children just 60p a day. (2008, June 23).

Retrieved from Daily Mail Reporter website: http://www.dailymail.co.uk/news/article

1028449/Exposed-Primarks-sweatshops-pay-children-just-60p-day.html

Outsourcing pro and cons. (2008). Retrieved from bizbrim Website

http://www.bizbrim.com/outsourcing/outsourcing-pro-and-cons.htm

Overby, S. (2009). What is outsourcing? In Outsourcing Definition and Solutions. Retrieved

November 1, 2009, from CIO website: http://www.cio.com/article/40380/

Outsourcing_Definition_and_Solutions?page=1