Kvedaravičienė, Goda
August 2008
Economics & Management;2008, p563
Academic Journal
Global outsourcing is a strategy, used by companies and is defined as right mix of onshore, nearshore and offshore resources, which should guarantee optimal balance of cost, growth, risk and efficiency. After companies started to distinguish core processes from non-core, non-core were moved to low cost countries by using two different strategies: deployment and outsourcing. In both approaches offshoring model became unstoppable, as organisations looking for cost savings were taking advantage of lower infrastructure costs and lower wages, i.e. switching from on-shore resources into remote offshore labour. However experiences have showed, that before you go offshore various risks should be carefully calculated and evaluated. As an option to offshore risks another model is taking strong position - nearshoring. Nearshoring means sourcing service activities to a foreign, lower-wage country that is relatively close in distance and time zone. The customer expects to benefit from one or more of the following constructs of proximity: geographic, temporal, cultural, linguistic, economic, political or historical linkages. The objective of the article is to disclose the origin of nearshoring concept and the circumstances, which caused its genesis, identify advantages, compare with offshoring and deliver conclusions, when nearshoring is the most appropriate approach and how it should be employed within companies' outsourcing strategies. Empirical part of the paper is based on actual data and examples of nearshoring development.


Related Articles

  • Where Have All the Help Desks Gone? Turner, Patrick D. // Certification Magazine;Jun2008, Vol. 10 Issue 6, p34 

    The article reports that contact center outsourcing is slowly disappearing in the U.S. The changing economy lead the U.S. industries to seek ways to cut costs and improve efficiency and do business outside the country. It says that the company can save money because labor in other countries...

  • Indian Outsourcing Industry Attracts Japan Business.  // EmergingMarketsNOW;8/17/2009, p12 

    The article reports on the move of Indian information technology and outsourcing companies to penetrate the Japanese market. The move made by India is intended to reduce their dependence on U.S.-based clients. Moreover, it cites that the culture barrier could be the one of the major challenges...

  • Offshore Outsourcing Savings May Fall Short.  // Business Communications Review;Feb2004, Vol. 34 Issue 2, p6 

    Reports on the overall savings rates earned by companies that outsource information technology work outside the U.S. Expected growth of offshore outsourcing; Assessment of the implications for vendor failure; Importance of considering contingency plan.

  • Business Process Outsourcing: Will Chemical Companies Go Offshore? Wheeler, Mike; Agarwal, Sanjay; Kearney, A. T. // Chemical Market Reporter;1/26/2004, Vol. 265 Issue 4, p21 

    Focuses on the offshore strategies of chemical industry in the business process outsourcing. Gap in offshore strategy between the chemical industry and other industries; Signifance of the bottom-line benefits from offshore for a chemical company; Catalysts for new interest in going offshore.

  • Beyond Tax Returns. Breslin, Penny // Practical Accountant;Mar2007, Vol. 40 Issue 3, pSR2 

    The article reports on the continuous evolution outsourcing. The addition of outsourced bookkeeping and accounting services is a win-win for the outsourcing industry and its clients. Outsourcing bookkeeping and accounting functions makes a steady stream of work for overseas employees and enables...

  • Smaller Firms Reignite Baja's Maquiladora Corridor After Decline. Allen, Mike // San Diego Business Journal;8/15/2005, Vol. 26 Issue 33, p16 

    Reports on the increase in offshore assembly manufacturing activity in Tijuana, Mexico. Formation new plants and increased employment after a period of retrenchment caused a recession of the industry; Total number of workers employed at several maquiladoras; Tax and tariff breaks granted to...

  • Further Reading.  // MarketWatch: Global Round-up;Feb2007, Vol. 6 Issue 2, p21 

    The article presents global developments related to various business enterprises. There is a growing trend towards outsourcing of fleet management across Europe. As the automotive fleet market in Western Europe reaches maturity, growth opportunities for outsourcing of fleet management services...

  • Hidden risks of software-as-a-service. Thompson, Herbert H. // Network World;7/31/2006, Vol. 23 Issue 29, p33 

    The article discusses the risks of outsourcing, otherwise known as software-as-a-service, in the computer software industry. Outsourcing recently has gained much prominence as part of the companies' effort in cutting some of the business processes and its corresponding cost. However, while...

  • MOVING TO MUMBAI. Chanen, Jill Schachner // ABA Journal;Apr2004, Vol. 90 Issue 4, p28 

    Focuses on the flaws of outsourcing paralegal services of companies in the U.S. to India. Support services being outsourced by several companies in the U.S. to India; Reasons that companies outsource the services to India; Concerns about outsourcing paralegal services from the U.S. to India.


Read the Article


Sorry, but this item is not currently available from your library.

Try another library?
Sign out of this library

Other Topics