P&G analysis: Business & Marketing Essay

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P&G Analysis
The outsourcing of physical goods entails a company contracting another one to produce products on its behalf. This applies in manufacturing where an entity wants to manufacture products but does not have the capacity. Hence, such a company will contract another manufacturer to produce the products at lower costs. The outsourcing of IT services involves hiring an outside company to handle the IT needs of a company. The third-party covers any IT needs from network securities to the installation of software and backup. Business process outsourcing is the approach of subcontracting some of the business-related operations to a vendor. In this case, the hiring organization requires the vendor to a process task that is critical for the success of the business.
The need to save on costs, increase efficiency, and improved functional support drive business to outsource. Businesses operate in a competitive environment, which creates the need to reduce costs so that products and services may be cheaper. Outsourcing business processes provides a cost-effective way of running a business. For example, when Procter & Gamble (P&G) outsources from Global Business Services (GBS), it managed to save on operating costs (DeLong et al. 4). The desire to improve efficiency is another driving factor in outsourcing. An organization may want to improve its efficiency but may not have the required capacity internally. Since the establishment of GBS on July 1, 1999, P&G’s critical processes like HR, financial reporting, IT, and accounting were brought together into one global organization that offered services to all P&am...