Flexibility on the International Management Essay

Pages: 8 (2469 words)  ·  Bibliography Sources: 12  ·  File: .docx  ·  Level: College Senior  ·  Topic: Business - Management

The second factor is the temporal nature of the relationship with outsourcers, especially if the length of the contract is not clearly defined, or if it's a short-term contract. The third factor is the exclusivity an outsourced worker gives a client. If outsourcer is working with multiple clients, this can add challenges for human resources. Lastly, the fourth factor that can affect human resource management in international outsourcing is the voluntariness of the outsourced work.

Negative Implications of Outsourcing for Flexibility for Human Resource Management:

Although there are significant advantages for the organization, for employing an outsourcing strategy for increased flexibility, there are disadvantages as well. In most outsourcing relationships, human resources loses a significant amount of control over the employees of the vendor company. Management and control are given to the vendor. With this, the outsourcing vendor may not have the same or similar employee policies in place. Instead of employee loyalty to the client company, as is found with on site employees, these employees will be dedicated to their company, the outsourcing vendor. This often means the outsourced employee will likely not be as dedicated to the client's mission, but instead they will be focused o their employer and assisting them with making as much money as possible. Even if this is only a perceived loss of control, it can negatively impact human resource management ("Transforming HR," 2005).

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Outsourcing also requires that human resources management develop third-party account management skills, which may not previously be present within the organization. When outsourcing includes the outsourcing of human resource functions, it also takes time for the retained human resource functions to adjust to focusing on managing the outsourcers outputs, rather than managing the processes that deliver the outputs. The transfer of knowledge to the outsourcing employees also requires dedicated resources from the client company and resources, which occasionally gets forgotten in the development of the business case for outsourcing ("Transforming HR," 2005).

Essay on Flexibility on the International Management Assignment

There are negative implications for human resource management in regards to the contracts involved in the outsourcing partnership. The renewal of outsourcing contracts often leads to the outsourcer being in a stronger negotiating position than the client organization. This is due to the effort and cost it requires for the contract to either be redistributed to another outsourcer or brought back in-house. If a renewal of an outsourced contract doesn't happen, human resources must deal with redeploying resources to the functions that are being taken over by the organization. In instances where an outsourcer is convinced to accept a contract that offers an unrealistically tight budget, oftentimes they will not put their best employees on the project. This can lead to further challenges for human resources in the client company as service standards decline. Even when a mutually acceptable outsourcing contract is signed, human resource management must make efforts to manage the contract, as well as deal with issues that arise from the relationship, on a daily basis. Outsourcing contracts need to also be developed to handle changes that may affect the business environment. If these contracts are not properly set up, human resources can be distracted by the continuing renegotiations that will have to occur, which will pull them away from other functions ("Transforming HR," 2005).

Confidentiality is also a significant human resources concern, when an organization is employing outsourced co-workes. In-house, an employee, who is dedicated to the company they work for, is far more likely to keep company and customer information secure and confidential. This especially affects proprietary organization data. However, outsourced employees who do not have this same sense of organizational loyalty may not ensure the data remains as protected as they should. These employees are tied to the financial success of another company, not the client company. Therefore, it is even more difficult for the client human resources deparment to help make sure the employees are motivated.

Lastly, there is a social stigma associated with the term "outsourcing." Too many jobs have been lost to overseas companies, as companies in more developed countries, like the United States, look to outsourcing for increased flexibility in their organization. This strategy can lead to decreased morale in the organization, for employees that are still working in-house. These employees may be unhappy with the decision to transfer duties their peers used to perform to workers overseas. In addition, these employees may be worried that their jobs are the next to be outsourced. Both of these reduce employee loyalty and can negatively affect their productivity. This presents significant challenges for human resource management.


In the end, the increased use of outsourcing, as a strategy to meet the opportunities and threats of an increasingly globalized and hyper-competitive world has significant implications for international human resource management, despite the increased flexibility the organization enjoys from this strategy. Developing and implementing human resource policies and procedures, with the challenges of outsourcing relationships in mind, adds to the already full plate of human resource professionals. In addition to these implications, there are several disadvantages that come with outsourcing for human resource management as well.

Works Cited

Fisher, S., Wasserman, M., Wolf, P., and Wears, K. (Fall 2008). Human resource issues in outsourcing: Integrating research and practice. Human Resource Management. 47(3), 501-523.

Fitz-enz, J. (Winter 2009). Disruptive technology for human resources. Employment Relations Today. 35.4, 1-10.

Haines, L. (4 Aug 1997). Outsourcing human resources pays off handsomely for growing firms. Business Journal Serving Fresno & the Central San Joaquin Valley. 322181, 12-13.

Klaas, B. (Aug 2008). Outsourcing and the HR function: An examination of trends and developments within North American firms. International Journal of Human Resource Management. 19.8, 1500-1514.

Kuruvilla, S. & Ranganathan, A. (Oct 2008). Economic development strategies and macro- and micro-level human resource policies. Industrial and… [END OF PREVIEW] . . . READ MORE

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