eThesis - School of Business electronic theses

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Research Objectives

Increasing cost-consciousness in the telecommunications industry drives network vendors to seek more cost-efficient solutions for delivery. The purpose of the study is to describe and evaluate how internal offshore activities are managed in the managed services market of the telecommunications industry and how cost accounting methods support this management. The theoretical part of the research aims to present offshoring as a global strategy and solution to improving business. In the practical part of the study offshore activities and their management, as well as the challenges and benefits that result from it, are examined through business cases of one company and interpretations are made based on the empirical evidence provided by those business cases.

Empirical study

The empirical study was conducted by using both primary and secondary sources. Primary sources were business case interviews with project managers, while the study was supported with company internal documentation related to business cases or offshoring activities in general.

Findings

Offshoring continues to be a growing trend. With the help of technology a lot of services can be transferred to global service centers where better utilization of shared resources and a lower cost per head help to reduce the costs of delivery. There are undeniable benefits from offshoring in terms of cost savings and faster service delivery as long as the transfer and maintenance of global operations are managed carefully from beginning to end. The study shows that challenges in offshoring managed services arise more commonly with communication and cultural issues rather than with technical feasibility or implementation and that cost accounting methods related to offshore activities leave room for improvement.