The Effect of Outsourcing On Cost Minimization in Public Organisations. A Case Ministry of Finance Planning and Economic Development

TABLE OF CONTENTS

DECLARATION ........................................................................................ i

APPROVAL ............................................................................................. .ii

DEDICATION AND ACKNOWLEDGEMENT .............................................. .iii

ABSTRACT ............................................................................................... iv

LIST OF TABLES AND FIGURES .............................................................. v

CHAPTER ONE .............................................................................................................. 1

INTRODUCTION ....................................................................................................... 1

1.1 Back ground .................................................................................................... I

1.2 Problem Statement ........................................................................................ 3

1.3 Objectives of the study ................................................................................ 3

1.4 Research Question ........................................................................................ 3

1.5 Conceptual Framework ............................................................................... 4

CHAPTER TWO ............................................................................................................. 5

LITERATURE REVIEW .......................................................................................... 5

2.1 Introduction ..................................................................................................... 5

2.2 Definitions ........................................................................................................ 5

2.3 Forms of outsourcing ................................................................................... 6

2.3.1 Offshore outsourcing ................................................................................ 6

2.3.2 On shore Outsourcing .............................................................................. 6

2.4 Process of Outsourcing ................................................................................ 7

2.4.1 Request for proposal (RFP) ..................................................................... 7

2 .4. 2 Examining the service provider. ............................................................ 7

2.4.3 Choosing a partner .................................................................................... 8

2.4.4 Finalizing Contracts .................................................................................. 8

2.4.5 Measuring Performance ........................................................................... 9

2.4.6 Contract end ................................................................................................ 9

2.5 Factors to consider before outsourcing .................................................. 9

2.5.1 Identification of non core activities ...................................................... 9

2.5.2 Seeking Profile .......................................................................................... I 0

2.5.3 Clearance of financial and performance conditions .................... I 0

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2.5.4 Cost determination .................................................................................. I 0

2.5.5 Time Scale .................................................................................................. II

2.5.6 Delivery methods ..................................................................................... II

2.6 Cost Minimization ....................................................................................... II

2.6.0 Definition .................................................................................................... II

2.6.1 Methods of cost minimization in an organisation ......................... 12

2.6.2. Reducing Customer Service level.. .................................................... 12

2.7 The Relationship Between Outsourcing And Cost Minimisation. 14

CHAPTER THREE ...................................................................................................... 17

METHODOLOGY ..................................................................................................... 17

3.1 Introduction ................................................................................................... 17

3.2 Research Design .......................................................................................... 17

3.3 Study population and Sample size ....................................................... 17

3.3.1 Sample Size Selection ............................................................................ 18

3.4 Sampling Design and procedure ............................................................ 18

3.5 Data type ........................................................................................................ 19

3.5.1 Primary data ............................................................................................. 19

3.6.2 Secondary Source: ................................................................................... 19

3.6.3 Questionnaires: ........................................................................................ 19

3.6.4 Interview Guide: ....................................................................................... 20

3. 7 Measurement of Variables ........................................................................ 20

3.8 Data Analysis and Presentation ........................................................... 20

3. 9 Limitation the study ................................................................................... 20

CHAPTER FOUR .................................................................................... 24

DISCUSSION, PRESENTATION AND INTERPRETATION OF TI-lE FINDINGS 24

4. 0 In traduction ................................................................................................... 24

4.1 Demographic Information ......................................................................... 24

4.2 PRESENTATION OF THE FINDINGS ON OUT SOURCING ............ 28

4.2: 1 Discussion and interpretation of the findings on out sourcing28

4.3 Presentation Of The Findings On Cost Minimisation ...................... 29

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4.4 Presentation Of The Findings On Out Sourcing And Cost Minimization

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CHAPTER FIVE ........................................................................................................ 34

SUMMERY OF FINDINGS, CONCLUSSION AND RECOMMENDATIONS

................................................................................................... 34

5.1 Introductions ................................................................................................. 34

5.2 Summary of the findings ....................................................................... 34

5.3 Conclusion ..................................................................................................... 34

5.4 Managerial and Policy Recommendations ........................................... 35

5.4 Areas for further research ........................................................................ 36

References ................................................................................. 37

Questionnaire ........................................................................... 39