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Outsourcing by Leaps and Bounds

By lexusat35 ·
Looks like outsourcing is really taking off -- based on news articles and latest research. Companies are progressively outsourcing more work than ever. New entrants are testing the waters and diving with small, but determined efforts to make outsourcing work.

New software and network technologies such as voip are all contributing to this phenomenal growth. Hmm... where do we from here?

Looking back -- when the Made in China labels first made it in the US, people were scoffing at it -- same with the Toyota's, the Honda's and the Made in Taiwan's. Global dynamics has changed that. Now, people buying at Walmart's don't mind buying Made in China labels.

Same thing will happen on outsourcing. As quality improves, and more success replicates, it will only grow. And people will stop the argument and be more accepting. Timeline? It won't propably take a decade -- it will be part of the daily life -- SMB, enterprises, everywhere -- outsourcing will be common fact.

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Is an improvment in Quality a given?

by Tony Hopkinson In reply to Outsourcing by Leaps and ...

In IT it's the first casualty of doing business.

The big problem with outsourcing, is once you do it, changing vendors or worse still reversing the decision, is expensive.

So you're locked in.

It's going to be like car insurance, you have to have it. The providers will target new business with special offers and hike the price on anyone foolish enough to show some customer loyalty.

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My company's take

by JamesRL In reply to Is an improvment in Quali ...

My company tested the waters for outsourcing in India. No North American jobs were cut, just new growth was supposed to be in the lower cost centre.

The problems they found were : 1) excessive turnover - we have a complex toolset and software to support and people were leaving before being totally training and productive (6 month mark), 2) Communications issues - some of our customers refused to deal with those employees because they could not understand them.

The alternative my company chose is to open new call centres in lower cost areas of the US. The costs for office space, taxes, labor is remarkably different in some areas that are 100 or 200 miles from a major centre.


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High Turnover is a factor

by lexusat35 In reply to My company's take

Yes, agree! In my consulting experience, we've seen this as a paramount negative issue -- in all sectors of outsourcing -- IT, and call center.
Though, Philippines is distant second from India -- it does not have that turnover issue and I've heard positive feedback that people there tend to be more stable and loyal.

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It can work but quality

by Tony Hopkinson In reply to My company's take

isn't free, you have to pay for it.
Let the bean counters make the decisions, you are going to get the cheapest not the best.

If you've a lot of buying power, you can beat the price down, then of course the provider has to break even, so what costs can they reduce?. Quality...

It's at least a years contract and their bean counters don't think past period end either.

Survive this year, maybe you can get a better deal, don't survive, then next year doesn't matter.

Short term propositions for Mr Magoos is the thinking behind most outsourcing. Nice to hear about an exception, but it is an exception.

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What you see may not be what you get.

by jdmercha In reply to Outsourcing by Leaps and ...

You may outsorce to a company in India. But guess what? After the deal is sealed you may then be dealing with an office in the US. We have a large call center right here in the US, that is Indian owned.

There are medium sized cities (over 1000,000) in the US where the cost of living is half the national average. Wages in those cities make them a cost effective alternative to outsoursing overseas.

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