July 29, 2006
Just how real are outsourcing fears?
I recently came across an article that cast a number of doubts over the outsourcing model. According to the article, outsourcers focus the entire offshoring business toward cutting costs, and neglect the quality aspects. If you take the article at face value, it is natural that you will think twice before outsourcing your business processes.
However, let us see just how real this fear is.
Think of an outsourced business. Yes, the basic objective is to cut costs, but with so many vendors vying for a place in the market, the outsourcer has plenty of options in selecting the outsourcing partner who is most suitable to the specific project and has the infrastructure and capability to execute it with finesse. So the onus is really with the outsourcer to find a capable partner. Every market has a few rotten apples, and this is true for outsourcing as much as for any other market.
The article cites the example of a call center that doesn’t handle client responses well enough. But hey, there are a number of checks and balances in an outsourcing deal which can ensure correct practices. There is talk of closing down a call center based in Bangalore (India). But what is the guarantee that the same situation will not arise even in-house?
The other fear raised about outsourcing is that an outsourcing vendor will not be able to adapt to changing practices and market requirements. But again, it is really upto the outsourcer to be foresighted enough and build such possible changes into the outsourcing arrangement from time to time.
Outsourcing ultimately boils down to a marriage of convenience between the outsourcer and the vendor. It is a sword that cuts both ways. A strong future-oriented relationship can trigger a long relationship. Believe me, outsourcing works—it is not for nothing that a hoard of outsourcers are making a beeline toward countries like India and China. You don’t have to take my word for it; in an older post, I mentioned research findings that back up this fact, and more recent articles continue to point to a growth in the outsourcing business.
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