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Edpro designs software and employs its own software programming team - HSC - SSCE Business Studies - Question 23 - 2008 - Paper 1
Question 23
Edpro designs software and employs its own software programming team. It plans to outsource programming in 2009. (a) Outline ONE external change that may have led E... show full transcript
Worked Solution & Example Answer:Edpro designs software and employs its own software programming team - HSC - SSCE Business Studies - Question 23 - 2008 - Paper 1
Step 1
Outline ONE external change that may have led Edpro to decide to outsource programming.
Answer
One external change that may have led Edpro to decide to outsource programming is the increase in competition within the software development industry. As more firms entered the market, Edpro likely faced pressure to reduce costs and enhance efficiency in order to maintain its competitive edge.
Step 2
Analyse the possible impact on management AND employees of outsourcing programming.
Answer
Outsourcing programming can have significant impacts on both management and employees at Edpro.
For management, outsourcing can lead to reduced operational costs and allow the organization to focus on core business functions. However, this shift may also require changes in management strategies to coordinate work with external partners, potentially complicating communication and project oversight.
On the employees' side, outsourcing can create job insecurity among staff, leading to potential layoffs or reassignment. This may result in decreased morale and productivity as existing employees might feel undervalued. Additionally, it could foster a negative perception of the company, impacting employee engagement and loyalty. Overall, while outsourcing can provide financial benefits, it is essential for Edpro's management to consider these implications on their workforce.