Globalization, Outsourcing & Insourcing: Impact of Technology on Careers

An error occurred trying to load this video.

Try refreshing the page, or contact customer support.

You're on a roll. Keep up the good work!

Take Quiz Watch Next Lesson
Your next lesson will play in 10 seconds
  • 0:04 Globalization
  • 1:28 Downsizing
  • 2:08 Outsourcing
  • 4:30 Insourcing
  • 5:41 Lesson Summary
Create an account to start this course today
Try it free for 5 days!
Create An Account

Recommended Lessons and Courses for You

Lesson Transcript
Instructor: Jill Heaney

Jill has taught college-level business and IT. She has a Doctorate in Business Administration and an M.S. in Information Technology & Leadership.

This lesson discusses the impact information technology has on careers. Globalization has been driven by advances in technology and has impacted job security and wages. We will specifically look at downsizing, insourcing and outsourcing.


Everyone, I have gathered you here today because I have an important announcement. As your CEO, I have to make tough decisions at times. These decisions are made in the best interest of the organization and consider the effects to all parties involved.

We live in an increasingly integrated society, one in which globalization continues to increase. Globalization is the increasing movement of goods, services and capital across national borders. Information technology has been a driving force of globalization. Advances in software, hardware, Internet and telecommunications have made it easier and faster for companies to communicate with employees, partners and suppliers from all over the globe in real time. Information technology facilitates greater efficiency and productivity and enables new innovations to spread quickly.

One of the costs of globalization is job security. Increasingly, jobs are moved across borders where there is cheaper labor, few environmental and labor laws and weak regulations regarding health and safety. Many jobs in the domestic economy are lost or wages are lowered to stay competitive with foreign rivals.


Unfortunately, we have been affected by globalization. Our company has to remain competitive, which requires some tough decisions and changes be made. We will experience downsizing in a number of departments. Downsizing means we have to reduce the number of employees that work for our organization. We will downsize our sales department, marketing department and finance department. We anticipate cutting 20 to 30 jobs over the next several months. This measure will help us cut costs by reducing redundancies, reorganizing jobs and streamlining our processes to be more efficient.


Additionally, our organization has decided to outsource its IT department in an effort to save money. What does this mean? Well, outsourcing is taking a workplace activity once performed inside the organization and moving it outside of the organization.

Deciding whether or not to outsource was a difficult strategic decision that the company had to make. There are various advantages and disadvantages of outsourcing. IT outsourcing can provide a number of benefits including cost savings, increased technical competence and a competitive advantage. Outsourcing IT can lessen the burden of routine tasks and allow the organization to focus on key IT activities. It can increase flexibility while reducing the costs associated with staying up-to-date on technological advancements. Service providers often encounter more problems and obstacles and will be able to better address issues given their wide array of knowledge and skills. We feel that outsourcing will reduce costs such as operating expenses, increase flexibility, improve management focus and quality of service and provide access to the latest technology.

A main risk of outsourcing is security of information. Information security centers around three parts: integrity, availability and confidentiality. Information should be accurate and safeguarded. Only authorized personnel should have access to the information when the situation warrants it, and only those authorized to access the information should be able to get to it. Once an organization outsources to a vendor, they have little control, if any, on how that vendor handles their information and keeps it secure.

Additional risks could center on quality and consistency. When the organization outsources the IT function, they will lose the level of control they have had with in-house IT. The organization must be sure to oversee outsourced functions and ensure they are getting the quality of service they are paying for. After weighing the pros and cons, we felt it was in our best interest to outsource the IT department.


We have decided to insource our accounting function including tax returns, financial statement preparations and bookkeeping. Insourcing is the opposite of outsourcing. Insourcing involves moving a business function in-house rather than having an external vendor complete the task.

To unlock this lesson you must be a Study.com Member.
Create your account

Register for a free trial

Are you a student or a teacher?
I am a teacher
What is your educational goal?

Unlock Your Education

See for yourself why 10 million people use Study.com

Become a Study.com member and start learning now.
Become a Member  Back

Earning College Credit

Did you know… We have over 49 college courses that prepare you to earn credit by exam that is accepted by over 2,000 colleges and universities. You can test out of the first two years of college and save thousands off your degree. Anyone can earn credit-by-exam regardless of age or education level.

To learn more, visit our Earning Credit Page

Transferring credit to the school of your choice

Not sure what college you want to attend yet? Study.com has thousands of articles about every imaginable degree, area of study and career path that can help you find the school that's right for you.

Click "next lesson" whenever you finish a lesson and quiz. Got It
You now have full access to our lessons and courses. Watch the lesson now or keep exploring. Got It
You're 25% of the way through this course! Keep going at this rate,and you'll be done before you know it.
The first step is always the hardest! Congrats on finishing your first lesson. Go to Next Lesson Take Quiz
Way to go! If you watch at least 30 minutes of lessons each day you'll master your goals before you know it. Go to Next Lesson Take Quiz
Congratulations on earning a badge for watching 10 videos but you've only scratched the surface. Keep it up! Go to Next Lesson Take Quiz
You've just watched 20 videos and earned a badge for your accomplishment! Go to Next Lesson Take Quiz
You've just earned a badge for watching 50 different lessons. Keep it up, you're making great progress! Go to Next Lesson Take Quiz
You just watched your 100th video lesson. You have earned a badge for this achievement! Go to Next Lesson Take Quiz
Congratulations! You just finished watching your 200th lesson and earned a badge! Go to Next Lesson Take Quiz
Congratulations! You just finished watching your 300th lesson and earned a badge! Go to Next Lesson Take Quiz
You are a superstar! You have earned the prestigious 500 video lessons watched badge. Go to Next Lesson Take Quiz
Incredible. You have just entered the exclusive club and earned the 1000 videos watched badge. Go to Next Lesson Take Quiz
You have earned a badge for watching 20 minutes of lessons.
You have earned a badge for watching 50 minutes of lessons.
You have earned a badge for watching 100 minutes of lessons.
You have earned a badge for watching 250 minutes of lessons.
You have earned a badge for watching 500 minutes of lessons.
You have earned a badge for watching 1000 minutes of lessons.