Outsourcing Times

Prudential incurs the wrath of the Unions

Prudential, UK's second largest insurer, has announced plans to outsource more jobs to India thereby leading to 700 jobs being lost in the process. The unions displayed their anger stating that the company was taking advantage of cheap labor and giving little importance to the loss of jobs. Independent UK reports:

The move, which will affect about 700 jobs, will see the group close its sites in Bristol, Belfast and Egg's headquarters at Holborn Bars in London.

EU initiates fund to combat the fallout of outsourcing

European Union has proposed a 500 million Euro annual fund to meet the ills of outsourcing like job losses. The fund aims to imbibe a sense of entrepreneurship amongst laid off workers as well as develop new skills.  The Times Of India reports:

The money, to be financed by a new 'Globalisation Adjustment Fund', is an indication of Europe's acceptance of globalisation and will be used to aid European employees in dealing with the unexpected developments and side effects of relocation to countries outside the EU, the INEP agency reported on Wednesday.

Shift jobs out to create more jobs!

In this day and age of globalisation any sense of nationalism especially in matters business is always misguided and counter-productive. A recent survey of consumers in the US have come up with the finding that 65% of the respondents said that if they knew that a paticular company was using call centres based in India, Philippines or anywhere else outside the US, they would buy less or even totally stop buying from that company. It does not take an Einstein or the ability to master rocket science to realise what would happen if people really began to do that. US companies would lose their competitiveness and go bust, lay-offs will rise, corporate sector savings will fall, domestic investment would fall - on the whole there will be more unemplyment in the US. It seems to go against intuitive logic but the truth is that the more jobs shift out of the US, the more jobs can be created within the US. Just try to figure that out!

Read more:Is the shine off offshore outsourcing?

Beeline to India for BPO jobs

If the mountain will not come to Mohammed, Mohammed will go to the mountain. So goes the saying.  With increasing globalisation something of the sort is happening in the global labour market. Till the other day, Indians, Chinese, other south east and far east Asians were making a beeline for the developed world in search of jobs. Today the tide has turned. People from the developed world are now flocking to countries such as India to find jobs. And you guessed right? Where else but in the BPO sector.  So what if those 'bally' Indians are grabbing all the new jobs? Just go over to India and grab those jobs yourself. Who is stopping you there. No doubt globalisation is creating a level playing field and perhaps, for the first time in the history of capitalism, the labour market is actually becoming a perfect market with national barriers disappearing and people moving freely between different labour markets. We all know what that means for the future -- wages will tend to become uniform across the world! Or, will they? What do you think?

Read more:Firangs discover India for BPO jobs

EIRCOM signs €35 million contract with Capita

EIRCOM has entered into a five-year outsourcing contract with British call center firm Capita Group. The agreement is worth €35 million, but will result in the loss of 200 jobs at EIRCOM.  Irish Examiner reports:

The deal is Eircom’s second with Capita and follows a similar three-year arrangement agreed in January which affected 200 staff who make outbound sales calls to encourage customers to take out extra Eircom services, such as broadband internet and add-ons such as call answering.

Budget constraints force Nolanville City Council to outsource EMS

To counter budgetary restrictions, the Nolanville City Council has reached a decision to go ahead with the dissolution of the 15-member emergency medical services. These positions will now be outsourced. Because of this step, at least seven EMS employees of Nolanville will lose their jobs. KCEN-TV reports:

Scott & White Hospital out of Temple will take over operating ambulance service for the town. They plan to hire only eight employees. Current EMS employees can apply for those jobs.

Northwest considers outsourcing of flight attendant requirements

After filing for bankruptcy in September, Northwest Airlines is attempting to reorganize its position by cutting costs. The airlines has already outsourced jobs which were earlier performed by its mechanics union, and is now making a move to outsource most of its flight attendant requirements on international flights.

This move has engendered worries in the unions of not only Northwest, but also other airlines; if the Northwest move succeeds, other airlines may follow suit. Professional Flight Attendants Association estimates that in excess of 2,000 workers would lose their jobs. CNN Money reports:

The demands on the Northwest flight attendants prompted the Association of Flight Attendants, an AFL-CIO affiliated union, to offer an unconditional, no-strings-attached pledge of resources and support to PFAA, an independent union that does not belong to the AFL-CIO.

The IT professional and outsourcing

The phenomenal success of outsourcing and the rate of growth that the industry has witnessed in recent times has led to a very real job insecurity, particularly in the IT sector. One way of ensuring that your job is not outsourced is to deliver what your employers expect from you.

According to Patricia Bramhall, president of Tydak, a Thousand Oaks, California-based consultancy, it is important to communicate well with the job requirements, and keep the focus on the customer. It is vital to understand the key areas of business that your company is engaged in, and then focus all efforts on the goals of the organization. IT is a sector that is always prone to outsourcing, and it is important for IT professionals to project themselves as part of the business process, so that the perception is there that the IT professionals are contributing something extra to the company. Datamation reports:

Once IT is aligned with business and working together to solve customer needs, conversations about outsourcing IT often are put on the back burner. But that's not always the case, Bramhall warns. The financial advantage of outsourcing work to people who are paid a fraction of what American workers earn is sometimes too great to pass up -- no matter how aligned IT and business have become.

Read More: Align with Business... or be Outsourced?

LSI Logic Corp. to close down its Gresham chip-manufacturing plant, turn to outsourcing

LSI Logic Corp., which manufactures chips for telecommunication, computer, and electronic products, has announced that it will go ahead with outsourcing its chip production to producers in Asia, and eventually may close down its manufacturing plant in Gresham. This decision has been brought about by the inability of the management to upgrade and modernize its plant to bring it at par with today's technology.

This move has already resulted in 90 job lay-offs at the Gresham plant, and put the remaining jobs in jeopardy. The company plans to continue manufacturing at Gresham until early next year, and is hopeful of getting a buyer for the plant. However, it will be difficult to get a buyer easily, considering that the plant uses an out-of-date technology. OregonLive.com reports:

LSI spokesman Kevin Brett said the company can't afford the billions it would cost to upgrade the Gresham site to keep up with the latest manufacturing technology. Instead, he said, LSI will outsource its chip production to contract manufacturers in Asia and put its Gresham factory on the market.

Read More: LSI to outsource production, sell factory

GKL PLC Announces Major Layoffs in Outsourcing Move

In what seems to be a global epidemic among automotive and aerospace companies, GKL PLC has announced it will eliminate 2,500 jobs at its U.S. and French manufacturing plants.  The company plans to outsource the work to firms based in Latin America and Eastern Europe.  This move is part of a larger company plan to increase output in low labor cost areas while eliminating much of their workforce in first world nations.  This strategy was made clear by a company report that indicated it planned to increase the production of transmission components by 70 percent in Mexico and 40 in Brazil by 2007, while simultaneously doubling production from existing plants in Poland and Slovakia.  What is interesting about the move is not that the company is planning to allocate its labor in a more cost efficient manner, but the fact that the company is being so straightforward about the move.  One could interpret this as an indication that the backlash against outsourcing is waning, but I think a more appropriate rationale is the shield offered GKN PLC by the industry it is involved in.  With automotive firms throughout the western world struggling to achieve profitability, the general public has shifted to support the firms rather than simply their labor. MENAFN.com reports:

GKN recently announced the colusre of two U.S. plants and said Thursday it was thinking of closing a Florange, France, facility.

Read More: GKN outsourcing 2,500 jobs