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Chapter 1. Moving from e-Commerce to e-B... > Harvesting the Partnerships: e-Busin...

Harvesting the Partnerships: e-Business Core Competencies

The e-business environment is one of intricate and dynamic change. New business environments require finding or developing personnel with critical skills required to get the job done. For many organizations, outsourcing their need for core competencies has been the answer.

The argument for outsourcing is simple: Individual companies cannot do everything well. True enough. In the first generation of outsourcing, the focus was on gaining efficiency and reducing costs, primarily in business processes and support functions, which weren't the company's primary-line work. Administration, human resources, accounting, and often IT (information technology) functions were the targets for outsourcing. For example, with the increasing complexity of computers and networks, more and more firms began outsourcing their technology management. In the 1990s, the biggest beneficiaries of this trend were computer service firms, such as IBM, Andersen Consulting, and EDS.[12] In the first generation, the business's core competence—its line of work—was never outsourced, for the reason that turning it over to "outsiders" who didn't understand the firm's customers and their needs would be extremely risky.


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