In some instances, companies may opt for offshore outsourcing to enable them to focus their attention on the core values of the firm. Paying small scale contractors on the other side of the world is now possible through online payment channels such as PayPal, MoneyBookers, Xoom, Payoneer, 2CheckOut and many more. Outsourcing enables the organization to cut down on labor costs and the cost of procuring expensive technology.
And it is not just American manufacturers offshore outsourcing their work to Asia, South America and Africa. A number of large companies in other countries are contracting American employees for work. For instance, major non-American automobile manufacturers such as Toyota, Mercedes Benz and BMW have set up huge manufacturing plants in the United States. However even as the company tries to maximize its profits, certain ethical questions beg answers.
Offshore outsourcing is gaining popularity among many businesses but sometimes for completely different reasons. Some companies choose this option in order to avoid paying hefty taxes in their home country or adhering to stringent local regulations. Is this ethical? You be the judge. While relocating the entire company may be an option, this may end up costing more in the long run. Therefore contracting part of the work to a foreign company might be the cheaper option.
While employers might justify this move by saying that they are assisting the poor people in developing countries, in the real sense this is all meant to benefit the company. And since it is a for profit institution, many may argue that there is nothing wrong with that. Outsourcing can cause internal discontent and lower employee morale. Some employees may consider offshore outsourcing as a way of showing them that they are incompetent and leaves them feeling inadequate. Of course, this was likely not the intention of the employer. Outsourcing pushes down salaries significantly.
Many other questions may need to be addressed if an organization decides to venture into another country. Certain laws that are being adhered to by the organization in another country may not be applicable or acceptable in their country of origin. Other key ethics questions that come into focus when a company opts for offshore outsourcing include environmental pollution standards that may be more lax in the host country than in the company’s home country.
Daven Michaels Author of the book Outsource This!