Articles

Global business Trend of Outsourcing
December 6, 2006


The Truths of Outsourcing

It is inevitable that as economies and industries change, not every individual will benefit directly or immediately. This is also akin to higher-cost countries that need to look at new ways of operating more efficiently and more competitively in a global economy. In the realm of BPO, operating on a global basis is a means to ensure that services are delivered in the most cost-effective and efficient manner. As a result, a group of individuals may need assistance to find alternative employment opportunities and not feel like a "sacrificial lamb" for the broader economy. While it is unfortunate that some people do get retrenched, the reality is, more people also get employed and more opportunities exist than before as the economy grows.

The global business trend of outsourcing is often accused of running sweat shops in low-cost countries and exploiting labor in these countries to reap maximum profit from the poor workers. One may compare the large salary difference between a call center agent in the Philippines versus a call center agent in Australia. However, the salaries paid to offshore workers in low-cost countries are often many times higher than what a worker in these countries would earn in other traditional sectors. Many gain the opportunity to own more consumer goods, live a middle-class life and break out of the poverty cycle. Therein also lies the risk of exploitation, which needs to be addressed by the appropriate authorities to ensure that the BPO industry does not suffer an image perception which has befallen other industries such as the garment and apparel industry.

Offshoring is not necessarily a panacea for all of a company's cost issues and strategies. It boils down to whether the global business trend of outsourcing aligns with the company's business objectives and meeting their customers' needs. It also depends on whether companies are ready to take on offshoring as part of their operating model. It is important to note that not every business function can be offshored, and often times, strategic areas such as corporate strategies, sales, governance, and policies still need to be retained in-house. Rather, BPO presents companies with the option to outsource non-core business activities so that efforts are focused on their core business. Offshoring, in fact, does not necessarily mean outsourcing and many companies do maintain shared services in another location, yet still have that service retained in-house.

Global product development’s cost savings are hard to ignore. In some cases, the Philippines can develop products anywhere from 30 to 50 percent cheaper than in the US. Some industry watchers estimate that the global business trend of outsourcing can increase product development productivity by 10 percent. Global partners can also help companies better design products that meet global tastes, which increases international sales and grows overseas channels.

Offshoring, Inc, an American owned and operated staff leasing company headquartered in Atlanta, Georgia and based in the Philippines, provides businesses and employers with a simple, no-hassle solution to offshoring business processes, in response to the influx of demand for outsourced products and/or services.

Offshoring, Inc is the foremost offshore staff leasing company that offers the best professionals in the labor pool, such as advanced degree holders and competently trained writers, graphic designers, programmers, media managers, quality assurance representatives, data entry clerks and contact center agents all who have practical experience in the workforce. The company helps international employers significantly reduce searching, training, and operating costs while maintaining complete control over the process. Offshoring, Inc’s edge among other staff leasing companies is the highly qualified skilled professionals that occupy their seats.

Providing US-based confidentiality and non-compete agreements, Offshoring, Inc values the client’s intellectual property and trade secrets in top priority. The company assures clients that the staff they hire are their exclusive employees until the contract expires. All potential staff are extensively reviewed with background checks and constant stern supervision. Offshoring, Inc dutifully protects their clients’ security. Offshoring, Inc’s value proposition of providing the best people, best processes, and best technology at a lower over-all cost applies to any business who gives importance to quality and efficiency.

Multinational manufacturers could increase product development offshoring from five percent today to 30 percent in the next five years (Financial Times, citing a recent study). Up to six million US jobs could be transferred to India in the next decade (Goldman Sachs Group, Inc.). Offshoring is the second highest cause of unemployment among US technical professionals (Institute of Electrical and Electronics (IEEE) Engineers). The average computer programmer in India costs roughly $20 per hour in wages and benefits, compared to $65 per hour for an American with a comparable degree and experience, according to consulting firm Cap Gemini Ernst & Young.

Back to top

Back to Articles