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时间:2014-10-03 08:57来源 作者:英国论文网 点击联系客服: 客服:Damien
(Novella, Christoph& Malte, 2007) defines off-shoring as "the relocation of production processes abroad, is an age-old phenomenon". This activity helps reduce transportation and communication cost and at the same time makes relocation of traditional production stage more and more convenient. If an IT staff will cost 60 dollar to perform tricky service in Australia, in the country of contractor for example India only cost 6 dollar. As a result, off-shoring could not only provide developing country employment and make work more efficient, but it can also deliver cost reduction to developed country.
Evaluation of bank's decision through shareholder theory:
Bring this case to Friedman's theory; the unique corporate social responsibility of business is generating profits for the shareholders (within the constraint of law). From this theory it seems that there is nothing wrong with banks' decisions to off-shore IT jobs. Lots of Australian invested in superannuation which means that most of them directly or indirectly own bank shares. Banks bore the obligation to improve the performance and reduce expenses for the maximum return to their shareholders. Banks believe that off-shoring is a dispensable tool to tackle this obligation, and also reduce the impact of Global financial crisis to Australian banks.
The cost reduction is the main reason for bank to adopt off-shoring decisions. As (Alexandros, Karen&Gopala, 2010) itemize the reasons that adopt off-shoring into two categories which are “cost reduction” and “other reasons. Then they picked suitable samples and examined the differences between the two reasons. Finally they found the primary off-shoring purpose which is cost reduction can realize more abnormal return and much more prosperous long-run operating advantage. When Australian banks announced they would strengthen the off-shoring activities, which will bring massive benefits to the shareholders and stockholders.
In contrast, it is the practice that high-skilled staff gains high salary. If banks would like to off-shore staff to assist other countries, they usually choose high-skilled staff to accomplish the mission, or the reputation of that bank will be lowered due to bad performance and assistance, the other reason is obviously wage expense reduction. However, delivering high-trained staff overseas will have impact to the skill of domestic countries staff, which turns out the banks’ operating error and other incidental problems.
Since banks attempt to lay off large numbers of employee, it may temporarily give banks good return, but in the long run banks are forced to invest more capital in order to improve the skills of staff and attract new blood of employee. The jobs which are lost will be refilled in the long-term, but with the improved technology the jobs may not exist anymore. Banks will seek more highly trained and flexible workforce to amend the losses of jobs.(责任编辑:BUG)

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