Case Study On The Influence Of Outsourcing On The Performance Of Firms

Outsourcing is a strategy employed by many firms with the view of reducing costs. These costs include high taxes, high labor costs, many government regulations, high energy costs, and high production costs. This research studies the impact of outsourcing on the performance level of firms. The dependent variable is performance of firms. The performance of firms is measured by the profits reported by the firms. The independent variables include labor, raw materials, government, and capital. Outsourcing enables a firm to get employees from other regions or countries. A firm can get raw materials at low costs if it has a division working in a country that has a steady supply of raw materials. The government can influence the firm positively or negatively through its regulations. The firm’s capital can determine whether the firm has the capacity to operate in another region.
The study will be carried out on Coca-Cola Company. Coca-Cola is one of the many companies that have outsourced all over the world. The research will determine the impact outsourcing has had on Coca-Cola. The sample size will be 30 Coca-Cola divisions in different countries. The data can be accessed online via the Coca-Cola website. The profits recorded by the company can be found in the financial statements available at the Coca-Cola website.
The cross-sectional regression analysis will be used in this research. The analysis will reveal the descriptive observations of the effect of outsourcing on the performance of the company. The profits recorded by the company will be used to measure the performance of company. Observations will be made on the impact of the independent variables on the profits.