Planet Outsourcing

As per a recent study it has been found out that India and U.S is sleeping whereas China seems to be cruising ahead in the arena of critical research and design outsourcing. The research states that India and US are way behind China in terms of performing basic research.

Vivek Wadhwa, Executive, Residence at Duke University’s Pratt School of Engineering, who led the research stated:

Outsourcing will continue and gain momentum, but this is not what we (US) have to worry the most about. What our new research highlights is that we’re fixing the wrong problems.

The study further states that US cannot depend upon the foreigners since they would return back once the economy of their countries improve. Are both the countries listening? China would surely leave both India and US really behind.

Via indiaenews

Up till now India was known more for IT outsourcing but it’s all ready to make a mark in the world of education outsourcing too. Indians are said to be good at their mathematics skills and in order to tap these skills, Guilford County School is one of the schools in U.S which is connecting its students with mathematics tutor in India through Internet. The pilot test started in January with hundred students of middle school participating in it.

The schools are taking the services of these math tutors for raising the math scores of their students. This tutoring program is expected to enable the students to have a one on one interaction with the math teacher and for every student lessons have been customized as per their requirement. The per student charge come to around $600 per student and students were invited to the program depending upon their previous mathematics score.

Via myfoxwghp

Deutsche Bank does not stick to one country for outsourcing and it deploys the services of various countries for its outsourcing work. It has been outsourcing work to a number of sites around the world in order to gain from competitive advantage. This bank is now moving more towards Russia for outsourcing as compared to India since this country has a number of financial and psychological overheads. Commuting to India is tough and even the hotel prices have shot up. On the other hand traveling to Russia is easier and it is offering competitive pricing along with good command over English.

Does this mean that India is losing prominence in the outsourcing arena? Not as of now but soon it may lose its crown since since the old perception about Russia is changing. Earlier Russia was thought of as a dangerous and difficult place to do business but now the perception seems to be changing and India might face some problems. First it was just China but now even Russia seems to be rising in this arena and now warning bells have surely started ringing for India.

Via businessweek

As per a latest study it is being claimed that the outsourcing advantages offered by India and China are going to vanish in the next two decades owing to increasing salaries and other costs in these countries. The study which was conducted by A.T. Kearney states that inflation is eating into the benefits being offered and over a period of time these advantages would dry up.

Average salaries for programmers in China, India and Eastern Europe have shot up between twenty to forty percent in the year 2006 as compared to a modest increase of five to ten percent in U.S. It has now become necessary that companies making global location decisions should target short term considerations and more on long term projections of talent supply and operating conditions. It now looks that this message might be lost in the whole process.

Via informationweek

Nigeria, an African country is looking forward to get hold of some share in the outsourcing arena and is working to create a platform for itself which would let then earn revenues worth $10 billion yearly from IT BPO sector. There is a very possibility that this sector would thrive in Nigeria and would help in the development of non oil sector of their economy.

Since Paris had a lot of skilled human capital in IT and Internet Service knowledge it would surely be able to deliver quality service and the launch is happening at the right time since it could help in development of entrepreneurial talent in the country and even attract foreign investment.

The country has a lot to offer in terms of English language knowledge, cultural fit and savings for the customers too. It seems Nigeria has a bright future ahead.

Via vanguardngr

As per a latest report it is expected that the European spending on outsourced logistics services in the pharma industry would exceed the mark of $2 billion by 2011 as it would result in growing opportunities for 3PL providers. The research conducted by Analytiqa states that logistics spending in Western European markets would grow by more than twenty percent and Spain is expected to emerge as a leader in this game.

Though the European pharma chain is highly regulated and complex but logistic services outsourcing is still in its infancy in Europe and it is expected that it would offer expansion opportunities for service providers.

Since European pharma supply chain outsourcing is underdeveloped as compared to that of U.S. , third party logistics provider have a great chance of staying ahead in the race if they are able to adapt their offering with the changing demand.

Via outsourcing-pharma

Shortage of skilled accounting staff is leading the companies towards outsourcing. Some state that bringing down costs is one of the reasons behind finance and accounting outsourcing followed by the shortage of accounting staff. A number of companies have started to move towards accounting outsourcing. Some of them even state that they are outsourcing for improving the quality of the financial and accounting services.

Due to this a number of local CPA firms are launching their rent a CFO services. It does not mean that everybody is going for accounting outsourcing, there are still a number of middle market companies which are not sure about accounting outsourcing and some of them feel that they might lose control over the outsourced process and are not even sure about the security too.

Though there is some skepticism but it is expected that in the coming years accounting outsourcing would blossom like anything.

Via accountingweb

It is being said that UK companies are losing out £55 million yearly during contact centre outsourcing. As per Exony, better management of outsourcing providers can help the companies to save this money and bring about overall improvement. Exony has highlighted ten areas where the companies could seek improvement and hence savings to the tune of 4.5% per annum. The areas highlighted are accurate forecasting and resource administration so that service level agreements are met and optimum billing methods.

Here are some statistics which would make the picture more clear to you:

Industry statistics show that 14 per cent of the UK’s 5,935 contact centres and 581,000 agent positions are outsourced[1]. Exony calculates that improving organisations’ ability to measure and manage their outsourcing providers would save £675 per annum for each of these 81,340 outsourced agents, making an annual total saving of £54.9 million in the UK alone. This would pay for an additional 3,660 customer service agents[2], dramatically improving efficiency and cutting call waiting times.

Certainly if proper steps are taken then companies could save this big amount and result in further improvements for their company and the customers in the long run.

Via crm2day

Around 105,000 people in Philippines are working in the arena of outsourcing and another million is expected to join this booming industry by 2010. Though economically it is proving to be beneficial but its culture has started to suffer. These people barely get to see the light of the day since they are working in nocturnal shifts, adjusting their sleeping hours has become really difficult and with the new American accent they feel out of place. Still a number of youngsters are flocking to call centers for work since the average salary in this industry is much higher as compared to the national average.

Coupled with abuse by the American customers this has led to frustration among the young working population. Abnormal working hours has started to have effect their health and has made them a caffeine addict in order to stay awake coupled with ENT problems. Lack of a proper family and social life has also left them frustrated but since there is a lot of poverty in this country therefore they seem to be continuing with the suffering. How far is this justified? It’s rightly said money can’t buy you all the happiness in the world.

Via nysun

A number of companies have outsourced their customer services to India which is being regarded as a favored destination for availing cost effective services. Companies opting for outsourcing are fully aware of the hard costs on paper but probably they might not be aware of the soft costs. You must be wondering what are soft costs - let me give you an example to make it easy for you to understand. Soft costs are measurable and this can include the English language nuances and American slangs to name a few. Companies not aware of these may cause severe frustration for their customers and may even lose out on business.

Here are some of the problems which are encountered by the customers:

Can’t understand the problem

Can’t effectively communicate in a way I can understand

Has no empathy for my problem linger on and on

Though one cannot say that customers are unhappy but there are certain people who are not happy with all this and companies need to make sure that the problems need to be solved at hand before they take a shape which cannot be controlled and cause long term problems for the companies.

Via bloggingstocks