The global risk factor

The business of outsourcing project work yields many benefits, most of which come with much risk. Although organizations can significantly cut costs by hiring IT outsourcing companies in lower-cost economies, such as those in Southeast Asia, these organizations could experience detrimental delays if any problem arises that disrupts communications between its project team and an outsourcing team located around the world. This article discusses the risks involved in using outsource companies to perform critical project and business activities. In doing so, it describes how project managers can mitigate an outsourcing effort's risks--both the predictable and the un-calculable. It looks at the concerns involved in selecting an outsourcing supplier and in deciding which functions to outsource; it identifies the main unknowable challenges--political instability, civil unrest, financial volatility, natural events--which can cause an outsourcing agreement to fail, explaining how outsourcing giant Tata Consultancy Ser
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