Procurement and Purchasing for Technological Force- MyAssignmenthelp

Question: Discuss about theProcurement and Purchasing for Technological Force. Answer: Strategies Reasons for Outsourcing by Company Outsourcing can be termed as a planned use of external resources to do activities which were usually handled by internal resources. It is a strategy in which specialised and experienced service providers are hired by an organisation to contract out their operational activities which are not central to their objectives. In several cases, transferring of employees from companies to outsourcing companies is also held. Outsourcing is important for the company as it helps in reduction of risks and to control its operating costs easily, along with this it helps in improving companys focus on core activities (Vetrkov, Marek and Milos, 2013). Another reason company chooses outsourcing is flexibility it provides partnering with an outsourcing company. The number one reason for selecting outsourcing is to reduce the cost as it will result in higher profit margins. Maximum use of external resources is there as it also frees internal resources to focus on other purposes. Outsourcing provides exp ertise service provides quicker and efficient services. Outsourcing also helps in improving services by hiring professional service providers. It assures companies to recognise the advantages of re-engineering. Forces Providing Preference to Outsourcing Technological Force Technological force helps in bringing better knowledge and great experience into Organization. By making use of outsourcing approach, outsourced operational activities will be updated with the latest technologies. For this, company will not require technological force as they can achieve their goals by paying to their outsourcing partners (Oshri, Julia and Leslie, 2015). Further, company will be able to avail the benefit of technology in minimum so as to reduce operational cost at the same time which can give better results. By outsourcing supplementary activities, management can develop technology for their core activities in order to enhance efficiency and productivity of business. In this manner they will be able to make improvement in their key performance indicators. Cost force Reducing of the cost is the main element for which company chooses outsourcing. One of the major objective of the company is to lower its cost as to achieve high profits. Proper execution of costs results in revenue identification (Schniederjans, Ashlyn and Dara, 2015). Outsourcing helps in controlling of companies operating cost easily. It also helps in reducing costs of sales by making reduction in cost salaries, infrastructure and other resources. By implementing outsourcing in their business strategies company can make optimise use of available resources by investing in core activities. Financial Force The concept of outsourcing makes elimination in the requirement of investment in infrastructure and in the cost of experts as this responsibility is taken by outsourcing partners. They provide assurance to the company for optimum infrastructure for the considered services to derive best possible outcome (Oshri, Julia and Leslie, 2015). This approach will make a reduction in the requirements of capital which will reduce finance costs of business. Outsourcing also provides a tax benefit to company tax shield for entire expense instantly without considering the concept of depreciation as infrastructure does not belong to the company. Organisation Force This is one of the major factors for which outsourcing is preferred by corporate entities. In accordance with this aspect, outsourcing reduces the burden for supplementary work so that workforce can focus on their primary activities to get efficient in their core competency. With this approach, the company will focus on developing the brand by achieving excelling in their core activities along with getting cost advantage of outsourcing (Kenyon, Mary and Peter, 2016). Further, they do not have work about ancillary activities as these will be managed by experts with perfection and optimum cost. The company can invest saved efforts and resources in research and development activities in order to provide value-added services. Revenue Force Outsourcing provides better accessibility to market through which company is able to get preferences of people in their core competency. It is because; with this approach, they are able to develop a network in the market in which they operate, and consequently they will get better interaction with the clients as well as distributors to services. In this manner, the enterprise will be able to attain competitive advantage (Awino and Jane, 2014). Outsourcing is a preferable and standardised way of inviting new blood through new ideas, possibilities and energy in business. This benefit can be accessed through the method of analysis and metrics in tracking the effectiveness of in-house management team. Consequently, success can be further refined for an accurate reflection of requirements of the company. References Awino, Zachary Bolo, and Jane Musangi Mutua. "Business process outsourcing strategy and performance of Kenyan state corporations."Journal of emerging trends in economics and management sciences5, no. 7 (2014): 37-43. Kenyon, George N., Mary J. Meixell, and Peter H. Westfall. "Production outsourcing and operational performance: An empirical study using secondary data."International Journal of Production Economics171 (2016): 336-349. Oshri, Ilan, Julia Kotlarsky, and Leslie P. Willcocks.The Handbook of Global Outsourcing and Offshoring 3rd edition. Springer, 2015. Schniederjans, Marc J., Ashlyn M. Schniederjans, and Dara G. Schniederjans.Outsourcing and insourcing in an international context. Routledge, 2015. Vetrkov, Milota, Marek Potkny, and Milos Hitka. "Outsourcing of facility management."E+ M Ekonomie a Management1 (2013): 80.