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Comus is most likely going to face some ethical issues if it goes ahead to execute the outsourcing plan. It is worth noting that outsourcing and off shoring of tasks has become a common practice among US based companies. Tasks are mostly outsourced to developing countries where labour is cheaply available.
Most companies in an attempt to reduce the cost of production outsource some of the tasks to offshore labour force. Outsourcing of tasks automatically leads to downsizing in companies that outsources their tasks. Weather this practice is ethical or not is highly debatable and heavily dependent on individual cases.
Being a controversial issue and one which will definitely affect one party irrespective of the decision made, there is need to weigh the benefits against the damages which are likely to result from outsourcing of tasks. Is it necessary for Comus to outsource its tasks? Comus Company at the present time faces an increasing competition and there is a need for to find ways to survive in the market.
Comus is already “hugely popular” and there is need for it to sustain its market share which it has already acquired. In the face of competition especially from similar products, price reduction becomes almost the sole solution to maintaining the loyalty of customers. In order to reduce the cost of production, outsourcing is mandatory for Comus.
It is fair that the Comus outsource its tasks in order to survive the market place competition but again it might be seen to be very unethical to exchange employees who have helped the company grow to those who have not made any contribution towards stabilizing the company. This can be a source of bitter exchanges between the employees and the management team. Weber (1994) insists that downsizing should be carried out as the last resort.
There is a need therefore to carry out the downsizing exercise in an appropriate way (Weber, 1994; Outsourcing, 2006). I suggest that the company should strike a balance between the maximum number of employees that can be maintained and the minimum amount of tasks that the company can outsource. It is not advisable for the company to undertake large scale outsourcing as this may lead to technical disruption in the production process (Ashley, 2008; Barrar and Gervais, 2006).
Comus should take downsizing as the very last option. The company should try to negotiate the salary package of its employees with an aim of spending less on wages. The management should make it clear to the employees that by withdrawing some of the work related benefits, it will be possible for the company to survive and avoid outsourcing their jobs overseas. I believe that a job with reduced monetary gains is better than none at all. On the side of the employees, they will likely use this as a grace period to find better means of livelihood. I feel that the company should find a way of appreciating the employees who will be laid off.
There are many companies which have successfully outsourced their back office tasks. Most of the fortune 500 companies are known to outsource their tasks.
Some of the companies which have been known to continuously engage in outsourcing include “IBM, Microsoft, Oracle, Cisco, Prudential, Hewlett Packard, ATT Wireless, TransUnion, First Consulting Group (FCG), Dell Computer Support, Bell South, EDS, GE Capital, GE, IBM, Schlumberger, Qwest and Rand McNally” (Bizbrim 1). Outsourcing is significant and helps companies situated in developed nations reduce their costs of production.
Ashley, E. (2008). Outsourcing for Dummies. New York, NY: Cengage.
Barrar, P and Gervais, R. (2006). Global outsourcing strategies. New York, NY: Prentice Hall.
Bizbrim. (2008). List of Companies that Outsource. Biz brim. Web.
Outsourcing. (2006). Outsourcing Ethics. The New York Times. Retrieved from: https://www.nytimes.com/2006/09/20/opinion/20wed2.html
Weber, L. (1994). Ethical downsizing managers must focus on justice and human dignity. National Library of Medicine National Institute of Health. Retrieved from: https://www.ncbi.nlm.nih.gov/pubmed/10135164