Outsourcing

...

Many organisation report that outsource employees do not display the full same commitment and dedication shown by the internal staffs. In the study of Bryce and Useem (1998, p. 639), “a mercenary may shoot a gun same as the soldier but he will not create a revolution or die for the homeland.” An assistant professor sociology at North Carolina State University, Martha Crowley has studied the issues and conclude that outsourcing jobs, layoffs, replacing salaried employees with contract staff would affect the employee’s loyalty and thus the workplace environment.

Outsourcing could create negative feelings for the internal employees and these feeling could impact the organisation culture (Kakabadse & Kakabadse, 2000). If not managed well, outsourcing could result interpersonal, group conflict and increased employee turnover by decreasing employee morale.

Thus, this study will focus on the consequence of outsourcing on employee’s attitudes.

- Research Objectives

- To identify the major factors that influence the outsource decision’s

- To determine the factors that affect employee attitudes due to outsourcing decision

- To study how the employee attitudes impact working performance and likely success of the outsourcing decision

- Research Questions

- What are the factors that influence the outsource decision?

- What are the factors that affect the employee attitudes due to outsourcing decision?

- How the employee attitudes impact the working performance?

- How likely is the success of outsourcing decision?

- Significance of the Study

The present research is concerned with the relationship between outsourcing and its impact on employee’s attitudes. A mix of quantitative and qualitative techniques will be used to analyse the data. Qualitative conclusions in the final stages will be support by the quantitative data. Maslow theory stated that the basic five needs have to be satisfied in order for the employees to realise development and growth. In order to apply Maslow theory to the organisation decision outsourcing, the managers need to know which level of the needs hierarchy are their internal employees located at and ensure their lower order needs are satisfied before appealing to the higher levels. Outsourcing introduces a new culture or a new relationship into an organisation would create both parties feel high emotional that could slowly creep in and destroy the relationship. This can be avoid by applied to how an organisation should treat the transferring employees in order to achieve the transformation that outsourcing promises. For the level 1, from the hierarchy, the survival needs represent basic human needs, such as air, food, drink and shelter, which the organisation should compensate the labour by paying the bills and cover the basic necessities of life and reasonable pension to have a modestly lifestyle. Whereas for the level 2, most of the employees would feel job insecurity when there are outsourcing provider who can provide a good job against at tight budget and deliver profit. Internal employee would feel fear of losing their job and the prospect of joining the unemployment line. Employee developed favourable attitudes towards jobs that bring satisfaction of their needs and unfavourable attitudes towards jobs that threat their needs. Outsourcing may affect in a loss of employment as talented employees would start to find job as employees suffer anxiety in working environment (Belcourt, 2006).

Dell had failed the outsourcing call centre in Bangalore, India due to Dell had to find ways or solutions to keep the skilled labour to work for the company in parallel of recruiting new talent candidates. Dell has encountered the talent constraint problem as they spent a long time to find people that are understand India’s culture but the turnover rate is high in India. US customers complained about call centre in India as delays in reaching senior technicians, poor quality of service and etc.

Outsourcing affects employee’s level of participation and working environment. Employee may be feel dissatisfied due to unexpected threat to their job security and perceived communication as a result of downsizing. Not even that, there will be a changed of trust and loyalty in employee commitment due to outsourcing. With outsourcing would raise the staff turnover, decrease productivity due to loss of commitment by Armstrong (2003). Employees normally react to outsourcing decision by thinking that employer under estimate their working skills and contribution. And thus appearance of the “survivor sickness syndrome” which increased fatigue and decrease in innovation and creativity.

- Organisation of the Dissertation / Final Project

This research thesis start with an introductory chapter which provide a general overview of outsourcing, problem statement, research objectives and scope of research.

Whereas Chapter 2, literature reviews which explores the theory of outsourcing and reviews the impact of outsourcing on employee attitude. This chapter reviews the factors that influence the organisation outsourcing decision, and present case study evidence of pitfalls of outsourcing. This review examines the evidence of consequences of outsourcing on employee attitudes and how these attitudes affect the failure of the organisation. And conclude with a conceptual model framework.

Chapter 3 presents the detailed research methodology by using Delphi technique to study the research questions. This Chapter also introduces the scope of questionnaire. Qualitative and quantitative data used to directly address and analysis to the research questions. The selection of respondents, sample size, and data collection methods would presented in detailed.

Chapter 4 presents the results and discussion of the results relating to the research objectives. Questionnaire are distributed to the working employees to study their feeling. Chapter 4 summarises the feedback obtained from the questionnaire from employees on the outsourcing impact.

Summary of findings on the impact of employee attitudes toward outsourcing and practical of recommendation for organisation to decide whether to go for outsource decisions will be presented in Chapter 5. A series of recommendation about outsourcing and impact of such decision on employee attitudes will