Ethics of Outsourcing

Global Business and Ethics

Corporations have a legitimate interest in self-preservation and find themselves in a unique position of being able to maintain a profit while meeting demands of offering competitive prices to customers. In order to increase profits and reduce costs, corporations are contracting with other companies or people to perform a particular function, otherwise know as outsourcing. In recent business history, companies have utilized the act of outsourcing to produce a product or accomplish a task in a more efficient, cost-effective manor. One of the most common ways we see companies reducing overhead cost and boosting profits is making the decision to begin global marketing and production.
The act of global business creates an ethical issue for organizations to consider. Being able to move business production over seas allows companies to produce their product at a lower cost, but creates a local downsizing epidemic. Organizations looks at the benefits of outsourcing form a bottom line and profit standpoint. As more companies are opting to move business operations over seas, local communities experiencing larger unemployment rates. Displaced employees are plagued by loss of retirement, health insurance and some witness a reduction in salary.
        A friend of mine works for a large manufacturing company that until recently employed thousands of people in the US with good paying jobs. They are affiliated with car manufacturing- supplying parts. My friends’ job is to train other employees in how to use the machines used to manufacture the car parts. The company went bankrupt. The new owners decided to shift most of their production and jobs to China and import the parts back to the US to supply the American market. The company removed most of their high tech manufacturing equipment from the US plants they had shut down, shipped it to china, and installed it in factories there. My friend's dilemma was that if he wanted to keep his job as a...