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Is Offshore Outsourcing An Effective Retaliation to the ROI ( Return of Investment ) Grind Down?

Amidst astringing market competition and consumers becoming more and more discriminating, product demands decrease and profits grow less. What can merchants do to sustain their business, offer competitive pricing, and still come up with considerable gain? A counteraction is available, and necessary, look upon offshore outsourcing.

Traditionally, businessmen turned to expensive ad campaigns and other marketing strategies that do not necessarily guarantee solid return of investment. Today, the effecting power of the Internet has given rise to the ability to reduce staff, as well as, production expenditure and pump- up company revenues. This ability to apportion staff- intensive servicing functions to lower- cost but equally capable offshore facilities hold a more realistic, and greater promise in terms of better income generation.

Misjudgment of Offshore Outsourcing

Like most anything on the leading edge, there are several issues that needs to be acknowledged with regards to offshore outsourcing.

• Is it Unpatriotic?
It has been implied that offshore outsourcing may become a potential threat to the domestic employment of an advanced country like America.

However, is it truly unpatriotic to want to safeguard a business, preserve affordable rates, and still come up with equitable company profits, and in doing so, provide much needed benefits to less developed countries or global society as a whole?

• The Language Barrier
Communication between peoples of different nations is greatly challenging, if not at all impossible to manage in terms of language.

Favorably though, there are emerging offshore outsourcing service providers all over the world with a generous pool of manpower who can communicate excellently in either British or American English.

• Compromised Product Quality
The issue of weakening product quality broods over in association with offshore outsourcing. Substandard operation and inferior work force are among the reasons presented.

Arguably, these problems could also arise right in our very own shores. In recent years, extensive efforts have been made to resolve human resource and infrastructure

concerns in foreign countries. Nations like India and the Philippines boast of globally accepted business park power plants, redundant back- up generators, and highly skilled professionals.

Remarkable Benefits

After addressing the misjudgments, it is fundamental to affirm that more importantly, offshore outsourcing provides remarkable benefits. Savings on all direct staffing costs- benefits, taxes, office space, equipment, IT services and telecom constitute to a 20- 40 percent potential growth in revenues.

Another noteworthy factor is the advantage of working with highly skilled, goal- oriented personnel who possess an admirable work ethic and a high degree of commitment.

Moreover, offshore outsourcing enables a business to literally operate 24/7, domestically from 8am to 5pm, and overseas from 5pm to 8am. This is due to the difference in time zones between internal and external (offshore outsourcing) processing functions.

Choosing a Partner

When the decision to employ offshore outsourcing is made, next stop is choosing a provider.
There are fundamental qualifications for any offshore outsource provider. First on the list is substantial first- hand experience in the processing functions that will be apportioned offshore.

These following inquests come after: Does this potential partner have a local U.S. presence? Does it offer various offshore locations? Does it have the facilities?

A local office ensures that the provider understands the domestic trend of the market. In addition, it is there when needed.

Culturally, certain processing functions are conducted more appropriately in one country over another. As an example, the Indian accent is thick while their counterparts in the Philippines have subtle or no recognizable accent when speaking English.

Without the facility to effectively perform the functions required, a provider’s purpose is defeated.

Lastly, make a cautious study of a provider’ s risk management measures like financial capacity and compliance, reliable data security and physical- plant safety including disaster recovery plans.

The effective and tactical employment of offshore outsourcing presents not only the opportunity for merchants to counter the ROI grind down, but also an opportunity to sustain profit and reach a bigger market share.

By Ms. Lelit Barrios
10 July 2007-BHI pro



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