Rationale for HR outsourcing

Rationale for Outsourcing                

General Rationale

Outsourcing provides greater economics of scale, flexibility, cost of savings, and effectiveness and expertise to a firm. Outsourcing has a strategic dimension too. Outsourcing strategy is an important value differentiator in present day dynamic market environment involving heavy investments.

Rationale for HR outsourcing

While the above rationales in general apply to HR outsourcing also, it is facilitated more by revolutionary developments in communication technology. The opportunities in HRM outsourcing has been realised by the companies with the advent of databases and support systems for management decisions. The outsourcing provides for web-based self service, which is very comfortable for the employers. New portal technology facilitates providing various requirements at a single point.

The in-house establishment and development of e-HRM applications require substantial investments and expertise. There is continuous escalation in expenditure for maintaining and upgrading the technologies, which prompted the companies to think in terms of outsourcing, because the practice of outsourcing already exists in other operations. Apart from these, HR always has a non-core-function tag, which contributed to increasing tendency to outsource it without much risk. According to the Institute of Personnel Development, the single largest reason for outsourcing HRM can be said to be the core-business concept. As the businesses became more and more competitive, the organisations began feeling that it would be more prudent to concentrate all their energies and expertise on their core-business and leave the HRM to outsourcing.

It is the experience of some organisations, which outsourced some low-end HRM functions, that with such outsourcing the managements were free to bestow greater attention to more important HR functions like Change-management skills and project management skills. HR outsourcing is considered to be a strategic tool for gaining competitive advantage. It frees the HR and other managers to leave aside the low-end HRM functions and concentrate on more important issues.

The other important reasons for HR outsourcing are cutting administrative and high transaction cost activities minimizing the work-burden of regular employees, taking advantage of economies of scale, gaining expertise and skill from outside vendors and improving efficiency and quality.

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Outsourcing and Types of HR outsourcing Providers

Outsourcing

Outsourcing means giving some specified service to an outside party under a contract with overall control remaining with the company. When an organisation does not want to utilise its internal resources for performing certain functions or activities it opts to entrust such activities to an outside agency or organisation, which has got the necessary competencies for such functions, to attend to them.

Types of HR Outsourcing Providers

Human Resources Outsourcing services can be classified into four categories . They are

v     Professional Employer Organisations(PEO).

v     Business Process Outsourcing (BPO).

v     Application Service Providers (ASPs).

v     eServices.

1. Professional Employer Organisations

The major HR functions can be listed as below.

Ø      Recruitment of personnel.

Ø      Training, both induction and on the job.

Ø      Monitoring of health and Safety measures.

Ø      Management of payroll services.

Ø      Specialist legal services.

Ø      Services relating to employee welfare, fitness and counselling.

The Professional Employer organisations take over complete responsibility for the entire gamut of tasks relating to Human resources Management starting with recruitment, the training of the personnel, their delayering and even performance appraisals are attended to by the PEO.

2. Business Process Outsourcing (BPO)

Business Process Outsourcing represents outsourcing of various management and operational functions. Applied to HRM, a BPO provides the company with management information system to support the company’s HR functions. Usually the arrangement provides for self access to the company.

3. Application Service Providers (ACPs) or e-Services

Application Service Providers present the required software on the web and lease it out to the companies in need. The software consists of both off-the-shelf applications and customised HR software developed by the provider. The software caters to limited functions like payroll management.

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War and Conflict

‘War’ can be defined as a continuous state of violence between two or more armed and organized groups. The groups can be either nations or some transnational groups. War usually involves mobilization of armies to fight for land or resources (Heuser, 2008).

‘Conflict’ on the other hand is a state of hostility which does not involve any armed fight but only results in strained relations between the two groups in conflict( Heuser, 2008).

The causes for way may be broadly classified as (1.) Religious causes,(2.) Dynastic causes, (3.) Political causes, and (4.) Economic causes. Religious causes are historical in the sense those wars were fought for the spread of religion like Islam. They lost their relevance in the modern world (Heuser, 2008).

Regarding other three reasons, it is difficult to pinpoint any particular factor as a cause for a war. For example, a monarch might have invaded a country citing hereditary family rights on that country. Prima facie it is a dynastic reason but the real reason may be that he might have set his eye on the resource of that country. Wars though usually are fought on some prima facie reasons, the main reason might be a combination of all the four above mentioned reasons (Heuser, 2008).

The causes for conflict are not as broad based and complex as those for war. These causes are mostly based on disagreements between the connected parties. Apart from this, conflict is different from war in another important context. While war can occur between nations or bigger groups, conflict can occur between individuals also like conflict in workplaces. But where ever they occur, they occur due to difference of opinion only (Heuser, 2008).

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Reference

Heuser,B.(2008,October). "Misleading Paradigms of War: States and Non-State Actors, Combatants and Non-Combatants", War and Society ,27 (2),1-24.

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Microsoft Tools Vs Open Source Tools

           There are many open-source spread sheet programs like Gnumeric, GNU Oleo, KSpread,  OpenOffice.org Calc, SIAG, Simple Spreadsheet and wikiCalc. Gnumeric has windows installers and comes inclusive of GNOME desktop and transfer data in various file formats like LaTeX,Microsoft Excel or HTML. It is mainly helpful with scientific and statistical tasks. While GNU Oleo is a lightweight spreadsheet package older than Gnumeric, KSpread is part of KDE Desktop Environment and OpenOffice.Org is part of Openoffice.org package and the rest are also equally capable free spreadsheet programs (Auza, 2008).

             There are many open source databases like Apache Derby, Cassandra, Memcached, Mongo DB,Neo4j ,Hypertable to mention a few. Apache Derby is under the Apache License and an open source relational database fully implemented in Java(“Open Source Database Engines in Java”,2010). Cassandra is distributed open source database used by social networking sites like Facebook,Twitter and Digg(“25+ Alternative & Open Source Database Engines”,2010).

            Among the open source word processing programs,OpenOffice.org, K-Office, Bean, AbiWord(Granneman,2005) are prominent ones. Bean is rich-text editor and easy-to-use word processor useful for making convenient writing (Hoover, 2009). Following is price comparison table (Gupta, 2010) for open-source software and proprietary software.

          Regarding choice of OS, I would like to go for open source software, because of the heterogeneity, compatibility, flexibility and security it offers.

References

“25+ Alternative & Open Source Database Engines”(2010).WebResources Depot.Retrieved January 25,2011 from  http://www.webresourcesdepot.com/25-alternative-open-source-databases-engines/.

Auza,J.(2008,Mar.4).”Free/Open Spreadsheets”.TechSource.Retrieved January 25,2011 from http://www.junauza.com/2008/04/freeopen-source-spreadsheet-programs.html.

Granneman,S.(2005,Nov.8).”3 open source word processors compared”,The OpenSourceBlog. Retrieved January 25,2011 from http://opensource.weblogsinc.com/2005/11/08/3-open-source-word-processors-compared/.

Gupta,M.(2010,Feb 22).Price Comparison Table:When or When not to use Open Source LMS.G-CUBE SOLUTIONS. Retrieved January 25,2011 from http://www.gc-solutions.net/blog/?p=55.

Hoover,J(2009,Jan.24).“Bean:a free word processor for OSX”. Retrieved January 25,2011 from http://www.bean-osx.com/Bean.html.

“Open Source Database Engines in Java”(2010).Retrieved January 25,2011from http://java-source.net/open-source/database-engines.

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Open Source Technologies-Problems and Business and Technology Issues

1. Problems addressed by open source technologies

Linux and other open source technologies address the following problems prominently.

Ø      The costs for a company are cut down to greater extent by using these technologies. Most of the open source software can be procured without cost (Fink, 2003).

Ø      Lapses in security are avoided. The code of the open source software is accessible in public domain. Those this availability of code can be exploited by hackers, the security of Linux is very strong. Apart from this, there is flexibility to install open source software at different levels of security in a computer (Fink, 2003).

Ø      Process of work gets smoother due to usage of this software as it follows industry standards as compared to closed source software (Fink, 2003).

Ø       Stability is provided while using open source technologies like Linux as operating systems. If there is Windows system, there will be issues of frequent rebooting, but such problems are avoided with Linux as it rarely crashes. Even while crashing, it does not harm kernel(Fink,2003).

2. Business and Technology Issues to be considered while using open-source software

            When existing software is being migrated to open-source environment like Linux, open-source equivalents should be explored for applications which are existing. This does not mean that all commercial applications can be replaced by open source. There can be migration to open source when only a fraction of the existing commercial applications are used (Fink, 2003).

            When migrating desktop environment, care should be taken that there is retraining to a greater extent other applications used in infrastructure apart from the one being done on operating system. Also it is to be made sure that all the web applications and user applications work with the Web-browsers based on Linux (Fink, 2003).

For using open source in business, the following pointers have to be considered (Fink, 2003).

Ø      The demands of the user have to be met as users are the developers and their input is significant.

Ø       An experienced software development manager is needed to run the project with an eye on quality and sometimes few components have to be rewritten to suit the user’s needs.

Ø      It might not be possible for the product to meet the requirements of all consumers. So software needs to be remodelled to suit the market requirements.

Ø      Management of people and their talents should be taken care of and there should be proper roadmap laid down for the execution of events. There should be right mix of corporate training and training on engineering processes.

Ø      There should be a very clear plan for migration and communication when there is transition from the current system to open source technologies.

Ø      Care should be taken that IP address is not transferred to other companies.

Reference:

Fink,M. (2003).The business and economics of Linux and open source.Upper Saddle River,NJ:Rentice Hall PTR.

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Importance of simplification of radical expressions before adding or subtracting

Simplifying radicals is important because basing on the root used for a number, the radical might simplify to be either a number of a radical. Only after simplification, we can know the exact irrational form of the number. When numbers are in such form, we can look for numbers with same radicals or otherwise we can look for like terms. The rules which are used with addition and subtraction of algebraic expressions can be used for radicals here treating the irrational parts as variables.

Example:

When we add  ,we cannot immediately add or subtract the terms, but extracting the numbers outside the roots and simplifying them, we have

So with simplification we can figure out like terms and combine them. So simplification is a must with radical expressions.

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Similarity and Differences between adding rational expressions and polynomial expressions.

Difference

When polynomials expressions are added, the like terms are evident by mere inspection as the variables need not be further simplified. But with radical expressions, it is a must that the expressions are simplified to figure the like terms.

Simplification is mandatory while adding radical expressions but while adding polynomial expressions; there is not need for further simplification before addition.

In the above example of addition of polynomial expressions, no further simplification was needed prior to group and addition of like terms.

In the above example with adding rational expressions, simplification is a must before proceeding with categorizing like terms and adding them.

Similarity

The similarity between addition of radical expressions and that of addition of polynomial expressions is that same rules are applied for addition in either case, but in radical expressions rules are applied after simplification.

Radical expression area grouped in similar way as terms in polynomial expressions while adding.

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Three myths regarding comparative advantage

 The three myths of this comparative advantage are

Myth1

A High wage country cannot afford free Trade with a low wage country. The high wage country will be undersold in everything. This myth is not true because labour is only one of the factors of production and constitutes input cost factor. The high wage country may have abundance of other inputs which are cheaper as a result of which the overall cost of the product may be low and price can be fixed at a competitive level.

Myth2                               

A low productivity country cannot afford free trade with a high productivity country. The former will be upstaged and decimated in industrial sector by the latter.

Again this myth cannot be totally true. In a way it says that a country, which has low productivity should close its borders to outside goods and produce everything by themselves, which is incorrect. Again high productivity is picturised as ‘absolute advantage’. Inspite of a country having a low productivity, it will have comparative advantage in some aspects and they can take advantage of the same.

Myth3

International trade decreases the total number of jobs in a country.

It is true that in some sectors there may be drop in employment on opening up the economy.  But there will be creation of employment in some sectors. As the international trade grows there will be a steady growth in employment. Moreover nowadays, even international organisations opt for employment of local labour for saving costs.

Thus all the three myths arising out of comparative advantage are incorrect.

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Standard Trade Model and variation of the model from Ricardian model and Heckscher-Ohlin theory

The Standard Trade Model combines the ideas of Ricardian model and Heckscher-Ohlin

Model and is based on four key relationships.

1.)    The relationship between PPF and relative supply curve.

2.)    The relation between relative demand and relative prices.

3.)    The relation between World equilibrium, World relative supply and World relative demand.

4.)    The way a nation’s welfare is influenced by the terms of trade.

The principal features of the Standard Trade Theory are

1.)    The Production Possibility curve represents the Productive potential of an economy.

2.)    Factor and goods exist in competitive markets. So all economic agents like suppliers, factor services, households and firms compete in the markets in which they operate.

3.)    A country’s relative supply curve is determined by movement along production possibility frontier at different relative prices of goods.

4.)    Relative demand (RD) and Relative Supply (RS) curves can be used to describe Autarky and World Equilibrium.

Difference between Standard Trade Theory and Other Theories

Ricardian and Heckscher-Ohlin models emphasise on identifying the underlying reasons for comparative advantage. While productivity differences decide the comparative advantage under Ricardian model, factor endowments decide the same in HO model. Standard Trade model adopts common features of various models and develops a set of techniques and tools which can be used for analysis of different trade and trade policy problems,

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Change of Relative prices for goods in the Ricardian model when trade occurs

The movement of relative prices under Ricardian model can be explained by taking two countries, say H and F initially. There are two goods say wine and cheese which are produced in sufficient quantities in both the countries. The quantities produced in both the countries are consumed in the countries themselves. So there is no trade between the countries initially. This situation is called Autarky under which each country is regarded as a closed economy and the situation is a closed economy equilibrium.

Let it be assumed that country H has a higher opportunity cost for cheese in terms of wine relative to country ‘F’. This means that country ‘H’ has to sacrifice more wine to produce one more unit of cheese than in country ‘F’.

Now let us presume that trade between ‘H’ and ‘F’ becomes possible because of certain development which reduce transportation costs. Businessmen notice that cheese is relatively cheap in ‘F’ and wine in ’H’. So buyers in ‘H’ opt for cheese in ‘F’ while buyers of wine in ‘F’ opt for purchase of wine from ‘H’. The situation leads to two developments.

1.)    The demand switch will lower the relative price of Cheese in ‘H’ and relative price wine ’F’. The relative prices in the two countries will then converge and are provided with free trade and negligible transport costs. There will be just one common international price.

2.)    The above price developments will cause manufacturers in ‘H’ to concentrate on wine production and manufacturers in ‘F’ to concentrate on cheese. They then trade with the two commodities to have a mix of the two. Thus Ricardian model separates production and consumption of commodities through relative price mechanism.

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