Emerging Trends in Business

Outsourcing Contracting out of a business function, which

was previously performed in-house, to an external provider.

Contracting with another company or person to do a particular function.

Trend of outsourcing is becoming more common in IT and other industries for services that have usually been regarded as intrinsic to managing a business.

Almost every company out sources in some way.

Function being outsourced is considered non-core to the business.

Outside firms providing outsourcing service are 3rd party providers or service providers.

Many large companies now outsource jobs such as call center services, e-mail services and payroll.

These jobs are handled by separate companies that specialize in each services, and are often located overseas.

Reasons……???

Cost Savings Focus on core business Operational Expertise Improve Quality Gain access to world-class talent and

capabilities Enhance capacity for innovation Share risks

Process

Strategic thinking Evaluation and selection Contract development Outsourcing management

Negatives of Outsourcing Loss of Control Quality problems Threat to security and confidentiality Tied to the financial well being of another

company Presence of hidden costs

Service sector

Service sector is the lifeline for the social-economic growth of a country.

It is the largest and fastest growing sector. It is employing more people than any other

sector. Service sector involves provision of

services to other businesses as well as final consumers.

Individuals employed in this sector produce services rather than products and goods.

Reason for growth

Increase in urbanization, privatization and demand for intermediate and final consumer services.

Backbone of Growth…..

Growth of Primary and Secondary sector is dependent on growth of services like banking, insurance, trade, commerce, entertainment, etc.

Service sector includes the following: Insurance Tourism Banking Retail Communication Education Entertainment Real Estate Transportation Healthcare Franchising Restaurants……etc.

Obstacles faced by service sector

Services are not tangible and thus convincing customers becomes difficult.

Differentiation is difficult. Quality of services depends on the quality

of individuals providing the services.

Commerce refers to activities related to purchase and sales of goods and services.

Electronic commerce, commonly known as e-commerce, consists of buying and selling of products and services over electronic systems such as the internet or other computer networks.

Business Applications

E-mail Online shopping Online Banking Electronic Tickets Teleconferencing

Basic categories of E-commerce applications Business-to-consumer (B2C)

Commerce: It describes activities of businesses serving end consumers.

Businesses develop attractive electronic marketplaces to entice and sell products and services to consumers.

Example: Virtual shopping malls with interactive order processing and secure electronic payment systems.

Example: Amazon.com

Business-to-business (B2B) applications: It describes commerce transactions between businesses, such as between a manufacturer and a wholesaler, or between a wholesaler and a retailer.

Example: The "electronic components district" of Guangzhou, where numerous shops sell electronic components to other companies that would use them to manufacture consumer goods.

Volume of B2B transactions is much higher than the B2C transactions.

Internal Business Processes: All business functions and many business processes are effected by electronic activities. It involves all such information which will be used to shape a company’s product development, marketing programs, customer service and competitive strategies.

Advantages of E-Commerce

Increased sales Decreased costs Reach to global market Opportunity for customers to compare

goods. No need of physical company setups