The Fundamental Challenge Faced by Dell Company
The fundamental challenge that the Dell Company faces, whilst others have items that require storage, equipment, employees, and logistical infrastructure. E-bay has a competitive advantage over others because it lacks actual objects and the desires that go with them. eBay must outsource its people. It is more cost effective for the firm to outsource customer support roles, particularly email queries, to different nations. Because most countries prefer English as their native language, the outsourced employee must be fluent in it. The eBay handles approximately 30% of its email support outsourced which could rise to 505 by implementing the three-tier plan of Mrs. Dalton. Proper training of the customer service functions can be achieved globally.
The Limits of Outsourcing Trust and Safety
According to this case study, eBay should expand outsourcing in several ways by proper strategies like BOT. what are the limits to outsourcing Trust and Safety?
Dalton's Approach to Trust and Safety
Dalton does not at any instance show appreciation of the criticality of the work in the organization, even though she has no direct safety and trust management experience. First, she ensured that every member of her team did not bring out the line position within the security and confidence. The group including her were very keen on selecting the easy work to train and the ones that were least susceptible to rework regarding her expertise. The work represented about 20% the total volume of trust and safety. She developed the tier three level of managing the work, and the proposal demands its processing in the outsourced centers in the closed proximity to the centers owned by the eBay to enhance the onsite visibility and support by the managers of the organization. It as well ensures that there are no limitations to language among the outsourcing vendor's workers to accelerate the high level of satisfaction and the quality of the expected of the task.
Advantages and Disadvantages of the BOT Strategy
What are the advantages/disadvantages of the BOT strategy and how does it stack up against the other two options Dalton outlines in her Excel spreadsheet? What are opportunism, capability, and flexibility implications of the strategy?
Dalton's Proposal for Outsourcing Trust and Safety
The proposal of Dalton demands the organization outsource the trust and safety volume to be taken care of in a similar way that Jim Williams at first manned the pilot with the PRC's Fort Lauderdale location in the past two years. It entails beginning with a small volume for examination and then slowly expands as the learning progresses. A detailed back out the program for the tier three in the event by Dalton thus the rise in the insurmountable challenges. The written contracts with the vendors were short term; only for the pilot duration that is enough to create credibility and reduce the fears of the management staff of the eBay.
Three Scenarios for Outsourcing Trust and Safety
There are three scenarios, including; Scenario 1; increased outsourcing of the third party vendors. The plan helps reduce the utilization of the eBay management and traveling expenses, no risk of starting the program from scratch. The disadvantages include the risks of contract negotiation, hidden costs, stiff competition from other Indian cities that outsource therefore being costly as compared to the long-term scenarios. Scenario 2; the organization can create its centers from scratch and work with them for long. It is essential since it lacks the contractual negotiation risks and least costly from the long-term perspective, and also trusted by the management. Scenario 3; eBay should have contracts with the vendors to help operate the centers for a short period and get the ownership of operating the facility transferred to eBay.
eBay's Senior Management Decision
What will eBay's senior management do with Kathy Dalton's new three-tiered outsourcing strategy?
Choosing the Best Outsourcing Strategy
The management will have to go for the BOT because it has the best risk/reward ratio of the all the three programs hence will help the eBay control their outsourced assets. It reduces cost and provide them ample control over the service quality. Mr. Dalton and her group have done an impressive work, and therefore her data will be convincing to the executive staff.
Reference
Barney, J. B. & Hesterly, W. (2014). Strategic management and Competitive Advantage (5th Ed.). Upper Saddle River, NJ: Pearson/Prentice Hall.
Pehlivan, E., Berthon, P. R., Pitt, L. F., & Chakrabarti, R. (2013). When outsourcing fragments: customer creativity and technological transmutations. Production Planning & Control, 24(4-5), 284-293.
N. Stone, D., N. Nikitkov, A., & C. Miller, T. (2014). Strategy, IT and control@ eBay, 1995-2005: The management control system (MCS) as consumer product. Qualitative Research in Accounting & Management, 11(4), 357-379.
