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Why are E-business and outsourcing referred to as the emerging modes of business? Discuss the factors responsible for the growing importance of these trends.

Answer:

Ans.     E-business and outsourcing are referred to as emerging modes of business. Prefix 'emerging' puts emphasis on the fact that these businesses are in the process of development. These changes are happening here and now, and, that these changes are likely to continue. In fact, three changes are taking place most strongly:

(a) Digitizaton: The conversion of text, sound, images, video and other content into a series of ones and zeroes that can be transmitted electronically.

(b) Outsourcing: Contracting out non-core activities to outside firms.

(c) Internationalisation and globalisation: More and more foreign companies are entering into India and sending Ashia and Indian companies becoming MNCs. Therefore, E - business and outsourcing referred to as the emerging modes of business.

Following factors are responsible for the growing importance of these trends:

(a) Improvement in Information Technology: With the improvement in information technology and emergence of internet the process of outsourcing and e-business is on an expansionary path.

(b) More and More Interactive Websites: Websites are becoming more and more interactive. It is removing the problem of 'low touch'.

(c) Improvement in Communication Technology: Communication technology is continually evolving and increasing the speed and quality of communication through internet.

(d) Diffusion of E-Commerce in all nooks and comers of the country: In order to diffuse e-commerce in all nooks and corners, India has undertaken about 150 such projects. It is also growing importance of these trends.

(e) Global Competitive Pressures for higher quality products: Due to adoption of new economic policy of 1991 in India, there has been an increase in competitive pressure from giant sized MNCs and global enterprises.

(f) Ever Demanding Consumers: There is increasing demands from consumers for high quality products at minimum cost. Therefore, e-business and outsourcing are being chosen as newer options.

But e-business and outsourcing are not emerging out of compulsion but also out of choice because of its benefits to consumers as well as producers.