Question

Quite a few organisations outsource services instead of hiring people as permanent staff. State any two disadvantages of this practice to the outsourcer.

Answer 1

Disadvantages of outsourcing are as follows:

1. Loss of Control: Outsourcing specific operations or processes can lead to a loss of direct control over quality, schedules, and performance. Using external vendors can make it difficult to maintain consistency, adhere to standards, and adapt to changing business needs, perhaps resulting to customer or stakeholder discontent. Confidentiality and
2. Security Risks: Sharing sensitive information, data, or intellectual property with external vendors might compromise company confidentiality and security. Outsourcing partners may lack the same security processes, data protection safeguards, and regulatory compliance standards as the outsourcer, raising the risk of data breaches, privacy violations, or intellectual property theft.