Why Global Outsourcing Is a Trick
Global outsourcing can also be a trick—a wolf in sheep's clothing. Here are three ways that global outsourcing might look good on paper but be a horror for your organization to implement.
TANSTAAFL. Every economist's favorite nine-letter abbreviation, which stands for "There ain't no such thing as a free lunch," applies to global outsourcing. Money for bandwidth, telecom, and travel doesn't grow on trees, and when you add expensive offshoring consultants, specialized lawyers, and salary premiums for managers to relocate overseas, all the perceived savings—or more—might disappear. Reduced labor costs might look like a treat on the surface, but a plethora of hidden charges can make for an unpleasant surprise if you don't look closely.
Communication difficulties. Communication is difficult enough when people are in the same room and speak the same language, so you can imagine how hard it is when people don't always speak the same language, are separated by several time zones, and have different cultures and worldviews. From a communications standpoint, sending work overseas isn't as easy as outsourcing it to a consulting firm across town. Organizations that aren't prepared for the cultural gap will feel that they've been tricked.
Not all IT tasks are commodities. Remember our axioms—when a good or service is a commodity, business efficiency depends directly on price. However, not all IT functions are commodities. Technical support, order-taking, and customer service can be done almost anywhere, whereas software development, content creation, and research and development can be more difficult to accomplish through offshoring. Thinking that every IT job can be sent offshore or outsourced is a trick.
Trick, or Treat?
There are enough benefits to make global outsourcing a treat as long as it's managed with attention and skill. Neither outsourcing nor offshoring should be an excuse for poor management or abdication of responsibility. If your job is a candidate for being outsourced or sent overseas, there's little that I or anyone else can say to convince you that global outsourcing isn't always a trick.
As President George W. Bush remarked in 2004 about sending jobs overseas from the United States: "The numbers are good, but I don't worry about numbers. I worry about people." The best way to avoid being caught in the undertow of jobs being outsourced or sent offshore is to give your employer a level of quality and efficiency that can't be matched by anyone in another country.