Many companies today are looking at outsourcing as a means to improve profitability, but in doing so it is important to realize that the decision is often not an easy one. The decision would be classified as a nonprogrammed decision. This type of decision is made when a company has not previously made this type of decision and there are no guidelines or previous experience to follow. This is the hardest type of decision to make because if the decision is unsuccessful there can be significant consequences to the both the manager or team who implemented the decision and the corporation. Nonprogrammed decisions also tend to bring a much higher level of risk. Outsourcing in particular is a high risk area. Many times companies looking to outsource are doing so because they are having financial difficulties and need to reduce costs. In order to reduce the risk of making a poor decision, the company needs to make sure that it has done all of its research. A decision of this magnitude should not be made quickly or easily. It should be made through a well organized process that involves the stages of decision making. A DMAIC decision making process would be a great tool to use to help the management ensure that the decision has been well thought out.
Once a decision of this significance is made, it is important that a company has a well defined implementation plan. A well defined plan will not only reduce the risk, but it will also lay the ground work of communicating the organization changes to the employees and their representative unions. Outsourcing is looked upon as negative to employees and unions; it is important that companies looking to use outsourcing understand that.&n ...