| Abstract: | The study's overarching goal is to identify the opportunities and challenges of labor outsourcing in the
context of Heineken Breweries Share Company. The research problem is that, while the company has
reaped numerous benefits from outsourcing, there are also issues and challenges that come with labor
outsourcing for agencies. The study is a descriptive study that used a quantitative research approach to
collect data from respondents via questionnaire and interview. The information was gathered from 150
employees of Heineken Breweries Share Company. Furthermore, interviews were conducted with the
human resource manager as well as the other two unit managers who supervise the outsourced labors. To
determine the sample size of the study, the student researcher used a non-probability sampling approach
for the customer population under study, as well as a convenient or accidental sampling technique. The
questionnaire was distributed to employees via convenient or accidental sampling, and the data collected
was analyzed using mean, frequency, table, grand mean, and standard deviation and descriptive statistical
methods. According to the study's findings, the company has benefited from labor outsourcing in terms of
lowering overhead and operational costs, improving quality, focusing on other core functions, and
assisting them in focusing on strategic issues. Despite all of these opportunities, the company has faced
some challenges as a result of outsourcing labor to agencies. The main challenges or problems are a loss
of full control over outsourced employees and an office divide that causes discrimination against
outsourced employees, resulting in a negative workplace. The findings revealed that labor outsourcing
positively contributed to cost efficiency and positively contributed to improved productivity, but that there
is inconsistency with employees and an unpleasant work environment through outsourced employees, as
well as a feeling of lack of motivation and belongingness and a communication gap between outsourcing
employees and the agency are the major problem figured out. Finally, the researcher has forwarded some
recommendations to address the organization's current labor outsourcing issues. The most important thing
is that both the agency and the company have to communicate at all times in order to solve the problem
with overall output. If the organization is able to implement the recommendations, it is expected to benefit
in reducing the challenges of labor outsourcing in the organization. The research has limitations because it
was conducted in a Heineken Addis Ababa, Ethiopia. The research findings highlight conclusions about
why organizations prefer outsourcing, as well as the challenges and risks associated with outsourcing
services. These are the reasons for outsourcing, for the opportunities, to focus on core competencies, for
flexibility, to knowledge transfer, and to value for money. |
