Outsourcing and organizational performance: a case study of APA Insurance Uganda Limited
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Date
2011-05
Authors
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Publisher
Kampala International University.College Of Humanities and social science
Abstract
Outsourcing is the strategic use of outside resources to perfonn activities that are usually
handled by internal staff and resources. This study was designed to explore the
relationships between outsourcing and organizational perfonnances at AP A Insurance
Uganda Limited. The major objectives of this study therefore were to find out; the
relationship between outsourcing and organizational perfonnances, Reasons for
outsourcing in the organization, the impact of outsourcing on organizational effectiveness
and the challenges to outsourcing at AP A insurance Uganda Limited. Twenty employees
of all levels of the company were interviewed and the findings were analyzed.
The results show that the organization generally considered successful at outsourcing.
The major reasons for outsourcing at the organization were; cost reduction, quality
control, reducing risks; focus on core competencies, failure to have the required resources
internally and the reduction of head counter employees in the organization. The major
impact of outsourcing in the organization were; improved quality, cost reduction,
improved reliability and delivery, productivity and sh01ied production cycle. Finally, the
respondents identified the fear of change, including fear of job loss, long te1m contractual
inflexibility, poor choice of outsourcing pa1iners, poorly managed contracts and hidden
costs and risks as the most the major challenges to outsourcing effo1is. However, while
the organization achieved significant improvement in organizational performance, it had
not reached the magnitude of improvements ascribed to outsourcing.
Description
Research dissertation submitted to the School of Business and Management in partial fulfillment of the requirements for the a ward of the degree of Supplies and Procurement of Kampala International University
Keywords
Outsourcing, Organizational, Performance