The effect of outsourcing on cost minimization in public organizations: A case study of Ministry Of Finance Planning and Economic Development

Abstract

The study is sought to investigate the effects of outsourcing on cost minimization. The research was guided by the following research objectives. To investigate the various forms of outsourcing in the Ministry of Finance and economic Development, to investigate and identify the various costs faced by the Ministry of Finance and Economic Development in project implementation, to establish the relationship between outsourcing and cost minimization. The study findings indicated that the Ministry of Finance, Planning and Economic Development uses outsourcing in project implementation. The organization though does not suffer adverse disadvantages of outsourcing as more than 80% of the respondents indicated that the Ministry plans to use outsourcing in cost minimization and less than 20% were not sure. However the study indicated that outsourcing faced a lot of challenges during project implementation and the ministry needed extra efforts to counter these effects. The study therefore suggested a number of remedies that can be used to minimize costs through outsourcing.