Challenges of Strategic Outsourcing by Mobile Telecommunication Companies in Kenya

Abstract

Various studies have been undertaken on factors that motivate companies to outsource but the challenges remain inherent of such strategic decisions. Increased expenditures and the growing number of players in the telecommunication industry have created many challenges to the telecommunication companies. In order to stand out from the competition and to have higher earned average revenue per user (ARPU), telecommunications operators are looking for all possible ways to cost-cut and pass on the benefits to end customer through better services at lower prices. The study noted that strategic outsourcing as much as the process had a number of whip hands as there were several short comings that should be taken into consideration. The shortcomings that were analyzed in this research were loss of control, operational risks, business disruption and lack of well-defined responsibilities. It was noted that strategic outsourcing led to loss of control over how certain services are delivered; this was noted to raise the company’s liability exposure. From the findings the researcher recommends the firms to carefully consider the vendor to partner with as well as the dynamics inside your own organization, and how your outsourcing strategy impacts your own people. Human capital goals must be aligned with outsourcing goals. You’ll want to optimize headcount while retaining key talent to execute the business. Careful planning and consideration helps to ensure your outsourcing strategy is successful. An area of further research is outsourcing to related partners. Further research should be considered on the challenges facing mobile telecommunications organizations that outsource their activities to related parties or parties with similar parent organizations