Outsourcing

Q.1. Discuss the following terms

(A) Core Competencies

Core competencies can be defined as an integrated knowledge sets within an organization that distinguishes itself from its competitors and deliver value to customers.

For example, companies such as Domino's Pizza, Sony and Starbucks have developed skills such as communication, technical knowledge and customer services that its competitors do not have to their standards. These skills helped them to gain competitive advantage over its competitors and leverage that advantage by learning and implementing faster than others in respective industries.

(B) Pro-active Change

Pro-active change is defined as a change initiated by managers to take advantage of targeted opportunities, particularly in fast changing industries where followers are not successful. For example, companies like Microsoft, Intel and Home Depot; who are dominant leaders in their industries, pro-active change in Innovative Technology, great support network and improved customer service would help them as leaders of their industry. In other words, Pro-active change is like preventive maintenance. These types of change initiatives are not designed to fix problems that have risen in the organization but to help renew everyone's focus on key successful areas.

(C) Four-fifth Rule

Four-fifth rule can be defined as Rule-of-thumb followed by EEOC (Equal Employment Opportunity Commission), in determining adverse impact for use in enforcement proceedings. According to this rule, a selection program has a negative impact when the selection rate fro any racial, ethnic, or sex class is less than fourth-fifth (80 percent) of the rate of class with the highest selection rate. The four-fifth rule is not a legal definition of discrimination but a method used by agencies to monitor serious discrepancies in hiring, promotion and other employment decisions.

(D) Protected classes

Protected classes are individuals of a minority race, women, older people and those with physical disabilities who are concerned by federal laws on equal employment opportunities.

Minority race: : For many minorities, employment opportunities are limited because of educational and societal disadvantages. Unemployment among minority youth is very high. Since the passage of this Act, there are improvementd for minority groups but their entrance to professional, engineering and managerial positions are still very low.

Women: : Women constitute the largest number of protected classes with accounting for 48 percent compare to 34 percent in 1980. With Significant number of women are being college educated, increasing number of women enter the labor forcer in managerial positions and account for 43 percent of all managerial positions in US.

Older People: : A company recruits older employees because they have proven employment experience, good work ethics and are reliable workers. They could also have positive effect on entire work group and are best suitable for part-time or hard-to-fill full time jobs.

Disabled Workers: : Currently disabled workers contribute 14 percent of the workforce and is due to companies complying with Federal Disability Act. Many disabled workers enter to IT field in recent years and companies like to hire disabled workers for their dependability, superior attendance, loyalty and low turnover.

(E). Benchmarking

Benchmarking is the process of comparing the organization's processes and practices with those of other companies, especially with the industry leader. To use benchmarking successfully, managers must clearly define the measures of competency and performance and must be objectively assess the current situation and identify areas of improvement. Managers use the following four processes before Benchmarking;

* Plan. Conduct a self-audit to define internal processes and measurements; decide on areas to be benchmarked and choose the comparison organization.

* Do. Collect data through surveys; interviews, site visits, and historical records.

* Check. Analyze data to discover performance gaps and communicate findings and suggested improvements to management.

* Act. Establish goals, implement specific changes, monitor progress, and redefine benchmarks as a continuous improvement process.

(F). Nepotism

Nepotism is a preference of hiring relatives of current employees. Companies found that the quality of employee-referred applicants are normally higher because employees would not recommend relatives that might not perform well. Also when hiring an employee's relative, the company could learn both the positive and negative aspects of the candidate which might not come out in the interview process. Nepotism has its share of disadvantages. For example, the employee and his referral will have similar background such as same race and religion; hence unintentionally discriminating against protected classes. The practice of Nepotism can invite charges of favoritism especially in appointment of desirable positions.

(G). Content Validity

Content Validity is an extent to which a selection instrument such as a test, adequately samples the knowledge and skills needed to perform a particular job. To fully utilize this method, managers must create the content of the selection instrument to the actual work samples or behaviors. For example, when hiring an IT engineer, the content instrument may include computer literacy, crisis management and familiarity with software. Content validity is the most direct and least complicated type of validity to assess and even though there are limitations, it can make a positive contribution to job analysis procedures.

(H). Situational Interview

It is an interview in which an applicant is given a hypothetical incident and asked how he or she would respond it. The response would then be evaluated with benchmark standards. This is commonly used for college graduates as this kind of interview is useful to test if the candidate has any creative thinking, experience or any leadership skills.

(I) Career Plateau

It is a situation in which either organizational or personnel reasons the possibility of moving up the career ladder is low. It is divided into three categories; a structural plateau marks the end of promotions and he will