Outline

Marshall Insurance Company

• Outsourcing relationship management is becoming a common practice among corporations due to its business performance and innovativeness benefits.
• David, there are various considerations that have to be looked at in your proposal.
• Lastly, Marshal Insurance Company is focused on improving the quality of products and customer experience of its services.
• The proposal will be evaluated on how best it meets the objectives of Marshal Insurance Company.
• Gilmore Printing company must have working terms and conditions so that Kara can look at and see if they perfectly blend with the company’s expectations.
• When agreeing to outsource, there are conditions that Kara should be aware of before agreeing to David’s outsourcing proposals.

In brief, Kara needs to have an insight into effective outsourcing.

Marshall Insurance Company

Introduction

Outsourcing relationship management is becoming a common practice among corporations due to its business performance and innovativeness benefits. It is a managerial discipline in which external service providers are allowed to manage one or more sections of an institution or company. Organizations implementing this managerial strategy intend to reduce labor costs in their labor demanding business process (Zhu et al., 2017). Although this approach is effective if well implemented, there are also considerations that have to be looked at between the client and the service provider. After the service provider has submitted and is accepted, a Service Level Agreement (SLA) has to be crafted between the two parties. An SLA is a commitment between the service provider and the client, which includes the responsibilities, availability, and quality of the services. In this case, Kara has an obligation to review all aspects of the outsourcing strategy, including the benefits and challenges, and share the various concerns with David during the meeting.

Response to David Callum

David, there are various considerations that have to be looked at in your proposal. Outsourcing is beneficial to an organization and can be implemented if an agreement is reached with one. For instance, the bottom line of this business is to increase profit margins by trimming off the costs. The main thing to look at is if the proposal will reduce the costs of recruiting and paying employees in the printing department (Tsay et al., 2018). Therefore, the evaluation of outsourcing against capital spend on labor development should be low, or in simple terms, the price of outsourcing should be low to meet the bottom line of reducing costs. While looking at outsourcing, various elements such as technological applications are also looked at. It's important to have insight into the technologies that will be used by the outsourcing company and if they will positively impact the organization or not. Technologies and innovations are playing a central role in defining the competitive positioning of organizations in the modern market, with those applying smart technologies ranking at the top. It's, therefore, necessary to explain the resources and technologies that will be used in outsourcing and how they are better and unique from the present ones. Lastly, Marshal Insurance Company is focused on improving the quality of products and customer experience of its services. It's therefore important to note that the products and services should be at least of the same quality as the present one, but it's more attractive if the outsourcing presents better quality services and products. Trustworthiness and meeting deadlines are also fundamental considerations.

Evaluating the Proposal

The proposal will be evaluated on how best it meets the objectives of Marshal Insurance Company. Gilmore printing can only be suitable if it meets core objectives such as reducing employee costs and improving innovations and technology applications in the company. If Gilmore meets the majority of Masharl's objectives, then it will be positively evaluated. Defining the terms and conditions is an important aspect to look at when evaluating the proposal (Salvador & Riba, 2017). Gilmore Printing company must have working terms and conditions so that Kara can look at and see if they perfectly blend with the company’s expectations. The terms and conditions of service can be well illustrated in the service level agreement. Through the SLA, Kara will be able to evaluate performance incentives and potential penalties that will help Gilmore Printing company work well with MIC as an organizational partner be accountable for its performance and the value it adds to the organization. Furthermore, the most beneficial outsourcing is the one that has continuous improvement. In the evaluation process, Kara will look at the handoff between the outsourcing provider and the company's internal organization. Even if the companies are different, they should not have a huge difference between the internal organization of the company and the outsourcing provider. Lastly, it's essential to evaluate the key areas in outsourcing that will impact the organization. Areas such as the human resource and quality of products will be directly impacted. Key performance indicators (KPIs) are also things to look at if they are affected.

Conditions for the Relationship

When agreeing to outsource, there are conditions that Kara should be aware of before agreeing to David’s outsourcing proposals. Before an agreement is reached and SLA signed, a detailed description of services Gilmore Printing will provide should be listed and signed against them by both parties. This is to avoid any disagreements on the responsibilities Gilmore Printing has to complete. Conditions on the payment schedule are also important and should be agreed on. In most cases, a net-30 basis is common and additional agreements or penalties, if necessary, should be developed in case the payments are delayed (Johnson, Leenders & Flynn, 2021). More so, Gilmore Printing firm should agree on business laws in its operations. Observing the laws is important to avoid collisions with governing bodies. Issues such as tax compliance and other business ethics should be important to observe.

Conclusion

In brief, Kara needs to have an insight into effective outsourcing. Outsourcing is beneficial if properly carried out, but sometimes it can be a failure if wrongly implemented. Kara will need to inform David on the company's fundamental objectives, such as increasing profit and improving on its technological innovations. This can only be achieved if Gilmore Printing has reduced costs than the current employment system of it will offer lower prices for its services, ensuring they are of top quality. It is, therefore, Kara’s responsibility to evaluate the proposal in regard to organizational objectives and other expectations. Lastly, the two should agree on comprehensive terms and conditions if Kara opts to accept the proposal.