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One of the biggest bogeymen in the current campaign is outsourcing. During the primary fight, Barack Obama and Hillary Clinton pounded the drum about the damage done to American workers by outsourcing and outdid each other in promising to stop it through tax policies and renegotiating trade agreements.
A chief executive who recently outsourced his customer call center to the Philippines and his IT help desk to India says the main reason was the much higher efficiency of those service providers - resulting in huge savings for his customers and his shareholders.
Lower wages were not the motivating factor. Anyone who outsources abroad because of lower wages is being short-sighted, he says. Rather, for him, it was the performance of the provider on quality metrics like percentage of calls answered within 30 seconds - much higher than the in-house operation at the company.
When he visited the call center in the Philippines, this manager found that employees invariably had a college education, and were motivated in their work because the service provider offered them a career path based on their performance. By contrast, in the U.S., call centers are seen as a dead-end job and plagued by high turnover that is very costly.
Why don't American companies offer the same efficiency at a call center? Well, this chief executive suggests, tax and regulatory policies in the U.S. can make it difficult for entrepreneurs to start up businesses. Also, it's hard to find people qualified and willing to do this kind of work.
By the way, this American company didn't get any tax breaks for shipping these jobs overseas. The savings were operational, and the decision was a simple business decision - the company's customers and shareholders, and so ultimately its employees, benefited from higher quality at lower cost.
This is the kind of competition that will force American companies and American workers to be better. Read on here. ****** Attend the affordable New Jersey Staffing Alliance MagicMethod Phone Sourcing July 15 webinar - details here.
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Steve, I am sure the 13,000 Employees that got canned from Bear Stearns, not to mention the millions who were affected by the Financial mortgage crisis FRAUD, will all be sure to wish that they had someone protecting their jobs or their homes. Isn't it ironic that Bear Stearns was financially Successful (allegedly) to the very day that Jp Morgan Saved them? http://www.nolanchart.com/article4263.h
I agree with Josh, that the Strategic Sourcing is much more than name generation. I disagree with him in that it is tomorrow's notion though. That is precisely what is causing companies' inability to find the candidates they need.
The reality is that strategic sourcing is a standard and formal process that incorporates on-going analysis to evaluate the right mix of tools and techniques to improve candidate generation performance and to reduce the total cost of recruiting them. Strategic sourcing is a process driven by an identified goal and when we fail to see it as such we fail to meet out goals. When we fail to meet out goals we find others to do it rather then analizing shortcomings and overcoming them; hence Outsourcing, off shoring etc..
I have worked in recruitment for 15 years and it never failed to amaze me that companies where always in dire need of qualified candidates but would take months to hire a qualified candidate oftentimes losing the candidate because of the slow hiring mentality.
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Sourcing 1.0 died with Kenny. And so on goes the saga as Sourcing 1.0 (Sourcing as Names Generation) continues to sink further and further than 6-feet into the ground. We all have to admit that this thread is worth a laugh because somehow emotional rants by GM workers then leads into a discussion about Unions :) . . . let�??s dump the diversions and get back on track.
Steve, where did anyone here post anything �??angry�??? I thought this was a collaborative discussion �?? I really don�??t see anger anywhere here. Perhaps the issue of perceived anger is more about how things are being read than the way they�??re being written. Personally, I don�??t see any other posts here that are emotional in any way, shape, or form. Maybe it�??s because I don�??t feel those emotions myself . . . so I�??m not going to see them in others�?? posts. Sigmund Freud, anyone?
What �??successful companies�?? are you speaking about? Avature? HTC? My company? Your company? Are we speaking success in terms of market share, stock price, wealth generation for the owners, etc.? What defines �??success�?? is often defined by the eyes of the beholder.
If anyone is looking for someone to say that unions today are a joke, look no further than me to say it. I posted yesterday on how union membership is at the lowest levels since 1932 (9% active membership in the private sector) . . . and how unions are more known for associations with organized crime than �??doing good�??. Unfortunately, that post was removed. Yeah, yeah, I�??ve now left myself open to hear about how great unions are, and how they helped do away with �??The Man�?? taking advantage of the U.S. worker . . . but that�??s a stale argument that�??s wore out its time. Am I a part of a Union personally? No. I�??m an entrepreneur �?? the buck stops with me �?? the year is 2008 and we�??re no longer industrializing. However, my father used to be a part of a very large one for one of the largest Aerospace & Defense organizations in the world (before moving into upper management), and he�??ll be the first to tell you that the Union creates more problems than it solves. Anyway, I am still at a loss at to what outsourcing has to do with unionization. Perhaps I missed a post somewhere.
To your comment, �??As far as all this emotional talk about the commoditization of names sourcing, let's assume that the author of this thought has actual data to support this assertion. I say "so what!"�?? I�??m the guy that made the above statement . . . so let me objectively answer your �??So what�??. As the training firms train talent in emerging economies, the U.S. (domestic) Telephone Name Generator struggles while watching their cost-per-name drop like a lead balloon. Training firms have created supply willing to cut the rates of our own domestic workforce of telephone names sources . . . so the charter for success must be to smell the coffee and improvise, adapt, & overcome the commoditization of Sourcing 1.0. As for data �?? what data do you need? The evidence is everywhere. Data is backward-looking . . . and today�??s global economy moves too fast to focus on the past. I know this statement sounds like a platitude, but it�??s a reality.
Here�??s my take: Tomorrow�??s notion of Strategic Sourcing is much more than name generation. I�??ve said it many times �?? Sourcing 1.0 is dead (just like unions), so this is my recommendation: Get back on your feet, regroup, brainstorm new ways to leverage your expertise, and focus on creating new forms of value in the way of competitive intelligence for your clients. At the end of the day, this technically isn�??t a death �?? it�??s a creative destruction and re-genesis.
Companies doing this? (Who I define as �??successful�??) = Jeff Weidner (HTC Research), Charles Hilman (Per Your Request), Avature, Qualigence, etc.
Sourcing 1.0 officially died with Kenny. The charter today is Sourcing 2.0 �?? I look forward to discussing with anyone who will be attending SourceCon or Kennedy Info�??s Recruiting Expo.
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Jay, thanks for adding to the discussion ("unions came into prominence to protect the employees from unjust actions on the part of the employer in the bygone days but now they have morphed into something else"), what does "something else" mean?
Moises - "to the employer who wants to pad their wallets..." - would you prefer some sort of socialism? Or would a for profit employer who still retains a social conscious by tithing "1% for the Planet" (this would be Patagonia) be reasonable? Is 1% enough after "padding" the bottom line?
All the broad brush commentors (outsourcing ruins everything; names sourcing is now commoditized, etc.) - show me the data!
There's no doubt that a small percentage of companies make a considerable amount of profit beyond what some might call "normal". Microsoft has an insane amount of cash on its balance sheet (as does ExxonMobil) but Bill has also managed to create the most prolific not for profit in the world and Microsoftees are known to be exceptionally community minded. Naturally not a single ExxonMobil employee or executive is equally socially conscious, right?
I suspect that people's beef is more with the leaders than the companies; I also suspect that company leaders who retain a social conscious in the face of large profits are given a few more mulligans than the Dennis Kozlowski's of the world...
One thought per this thread... I'm not sure what "the natural way of things" means. Business is partially ruled by the Lemming Principle where others follow what works in other organizations even if it means going over the cliff. If following others over a cliff is natural in business then our b-schools have some work to do.
Outsourcing is just another business process that works well for some and not for others. The gap in results between successful and failure can be attributed to, among other things, inadequate or poor planning. As with any idea, outsourcing works for some and not for others.
As far as all this emotional talk about the commoditization of names sourcing, let's assume that the author of this thought has actual data to support this assertion. I say "so what!"
Why?
Because even commoditized services have a pecking order associated with the quality of the service. People will always pay a premium for superior quality results and the best of the bunch will still generate more revenue.
Why is all this anger directed at successful companies?
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Jay, doesn't that depend on which side of the fence you are on? In California the grocery strike made a difference to the lives of thousands of individuals which included wage increases, and health care funding.
To the employer who wants to pad their wallets, this is definitely not a pro, but to the thousands who benefited, it could not have occurred had it not been for the Union.
There is a pro and con for every thing, and to see it only as black or white is unfortunate for those who benefit and even for those who don't.
Moises
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Unions came into prominence to protect the employees from unjust actions on the part of the employer in the bygone days but now they have morphed into something else.
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Re: Maureen and Steve's labor union discussion-
A long time ago, I belonged to a branch of the Sheet Metal Worker's Union in Tucson, my aunt was an organizer for the American Federation of Teachers, and my father helped organize a chapter of the National Education Association (He would have preferred to affiliate with the more militant A F of T.), and oh, we boycotted grapes in the '70s..
In case anyone can't guess (from this or my earlier comments), which side of the the pro- or anti-union debate I'm on?
Cheers,
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Keith great comment, I am extremely encouraged by the fact that this is becoming a topic of discussion today.
Just recently I became aware of an event that Earl Mann and Karen Mattonen are putting together. What is really interesting is that they recognized the need to address these issues and teamed up and came up with what is probably going to be the largest Conference to date.
What is even cooler regarding this this event was that they recognized that today it is difficult for some to even leave their desk to attend conferences, so they found a way to allow it to be viewed Live online.
Check out http://www.r4conference.com/ to get more information.
Moises
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I've missed you Mr. T...and I know that blue collars are viewed as another form of Larry the Cable Guy.
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Steve: I will answer your question after I watch the white collar comedy tour...
Come to think of it, what a great idea that would be... It would make money, be funny, and make blue collars look veritably Einsteinian...
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As related to CBAs, the words "lifetime" and "guarantee" represent hopeful interpretations by members based upon dewy-eyed recollections of days of yore.
[BTW, I've been in a union since 1977, have been part of the Executive Board for a two-year term, have been part of the negotiating team sitting across the table from "management", have been a shop steward for many years, and have experienced the good, the bad, and the ugly of labor-management relationships. And I've been in HR on the "other side" for two decades.]
Take a look at the UAW site (www.uaw.org/contracts/07/gm/index.php), particularly where the details of the CBAs with the Big Three are offered. Note this representative quote from UAW Vice President Cal Rapson, who directs the UAW GM Department.
"We�??re dealing with the realities of a highly competitive industry that does not operate on a level playing field. We�??ve negotiated a realistic agreement that protects existing manufacturing jobs, and also creates the possibility for future growth."
I don't see the words "lifetime" or "guarantee" used as part of his victory speech - but I do see the vague phrase "possibility for future growth" - and if you read the contract on this site, you won't see it in print either.
People's reactions to unions are heavily visceral and unless you're a blue collar worker who depends upon these contracts you can "feel" only so much. Can't blame the unions for the ills of our global economy - because someone in "management" had to sign off on the contract. Where does the fault lie when someone is clueless about long-term planning?
Now be honest - y'all think blue collars are lazy dumbasses? Well don't you?
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How many people in this thread who have strong opinions about unions have actually been in unions themselves and, even more, have been part of a team that has negotiated collective bargaining agreements?
I'm just wondering.
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Louie:
"Just as with racial, ethnic and gender stereotypes, labeling certain behaviors as 'boomer' or 'Gen-X' adds nothing to resolving the problem and adds much to misunderstanding and anger. "
Everywhere, including if you watch reruns of the just-held Fordyce Forum, pinstripers and researchers alike are on overdrive slicing and dicing the market up by these terms, and teaching us to change out pitch and content to satisfy our audience's category. It's segmentation.
Not saying it's good or bad, but for your message to take hold, there's a lot more "educating" to do, if the segmentationists think they need educating at all.
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Hear, Hear! It's time that we get rid of the outmoded early-20th century concepts of mutual loyalty, respect, and team work that have been propagandized as virtues to middle- and lower-level employees. Instead, we should all be like CEOS and higher-level executives, making sure we maximally line our own pockets as long as we can regardless of the cost to others and the moment things look "iffy," get out with as much as we can possibly get. I'm rather puzzled as to why employees of major U.S. corporations can imagine that any policies enacted are designed to benefit (or minimize loss) more than the top 1% of employees? It's their country (I mean "company"); we just live (I mean "work") there.
"Loyalty equals cash-flow," Breughal, Max HeadRoom- 1987
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Hello Charles,
This may have been true when economies were more isolated, but in today's globalized economy, as long as somebody (Europeans, Indians, Chinese, etc.) can get them, manufacturer/service providers don't need to have their products/services bought where they're produced. America doesn't need a middle class- and we're certainly doing many of the right things to get rid of one. If you want to stop offshoring, then start outsourcing C's to Europe or Japan where they get ~ 1/3 of what they do here.
If I'm a senior executive, as long as I get mine and unless I get a big share of my comp from long term stock value, who CARES what shareholders get in the long term? They're just a bunch of suckers, too. Don't they realize it's not THEIR interests I work for, it's MY interests? If necessary, I'll pump up the price while I'm there, cash out, and watch the cards fall. It's not as if any important people get hurt.
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DATE: 7/18/2008 7:18 a.m.
SUBJECT: RE: Is outsourcing outrageous or the natural way of things?
MESSAGE: In the long run moving operations overseas will have a negative impact on stockholder value. If people make decent wages they tend to make more purchases. They are more likely buy a bigger house, buy a new car for the garage, they need appliances and furniture for the house, perhaps they will buy new clothes. If they are making decent money, they will eat out more often, go on vacations, etc. When this happens companies will see an increase in revenues and most likely profits. The executives can give themselves a fat bonus and stockholders will most likely see an increase in dividend and an increase in shareholder value.
When companies move operations overseas to trim cost, this may look good on the financial statements in the short term but in the long term a large percentage of their customers have seen a large decrease in their income and must cut their cost, which means companies will see a decrease in revenues and profits and shareholder value will suffer. Who wins here?
POSTED BY: Charles Hillman Per Your Request Research Founder http://www.ere.net/ERENETWORK/PERSON.ASP?USERID=87183738
To post your own reply to this discussion, visit: http://www.ere.net/EREN/G/LSTNG.ASP?ACTION=CREAT&THREADID={6C6FF637-7E5E-4476-BA6B-B4D27FFB7F10}&BOARDID={3B6E1895-276F-4DB4-8CBC-D882D2C88523}&99=/
To view the entire discussion thread, visit: http://www.ere.net/EREN/G/L.ASP?LISTINGID={6C6FF637-7E5E-4476-BA6B-B4D27FFB7F10}&99=/
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I agree with the comments about globalization. However, labeling is a divisive tactic, guaranteed to elicit emotion, and an interesting tactic from someone espousing to take a rational approach. There are examples of every facet of human behavior in every generation. Just as with racial, ethnic and gender stereotypes, labeling certain behaviors as 'boomer' or 'Gen-X' adds nothing to resolving the problem and adds much to misunderstanding and anger.
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"In the long run moving operations overseas will have a negative impact on stockholder value. If people make decent wages they tend to make more purchases."
Are we drawing correlations between consumer confidence or overall GDP to the ultimate goal of creating shareholder value? Such an argument 'may' (and that's a long shot) be applicable to B2C organizations (consumer packaged goods, etc.), but hold little to no merit for B2B.
Let's consider a CPG company that is having trouble maintaining margins due to increased fuel costs (logistics expenses). If they don't increase prices, their margins reduce. Let's simultaneously consider the consumer who is also seeing fuel costs increase (hurting them for personal transporation, food prices, etc.) The end result is less consumer discretionary spending, squeezed margins for the manufacturer, etc. Something must give.
Organizations look to streamline costs and remove redundancies from the supply chain through cheap labor in emerging economies. They also understand that providing "decent wages" in emerging economies leads to growth of the middle class there . . . leading to more consumption. What I'm suggesting is that the U.S. market isn't the only one worth attention.
Above all, there is one major flaw with the argument that "They are more likely buy a bigger house, buy a new car for the garage, they need appliances and furniture for the house, perhaps they will buy new clothes." By looking through only a lens of the U.S. consumer market, we're missing the boat. Our market is not the panacea it once was; the real opportunities are in emerging markets where the middle class is burgeoning *there*, not here.
You don't create shareholder value by strictly focusing on the U.S. market exclusively. There are other areas with less competition, requiring less investment, and promising higher probability of consumption (India, China, West Africa, etc.)
Say's Law needs to be reevaluated within the context of a globalizing economy. [This discussion is more than a message board can handle.]
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What Paul and Deborah said.
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In lieu of individual employment agreements or contracts, strictly between and individual and an employer, "free will" employment takes precedence. All compensation, benefits, and employment relationships can be ended at any time...the only legal obligation is to pay the agreed upon wage for hours which can be proven to be spent in service of the company. No company in full reality guarantees to provide specific benefits for the duration of employment, much less for life! Conversely, no person need guarantee he will be loyal to a particular employer for any length of time; he is free to leave with or without notice. To tie up court systems in pursuit of circumventing perfectly legal business or personal decisions which align with the very core of a free economy goes against everything we as U.S. recruiters (notice how we bring this back to our humble profession) hold dear.
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Just what is in a "lifetime promise" and are they legally binding? It will be interesting, very interesting to watch these things play out.
Across the country in contract disputes and bankruptcy filings, federal courts have been pulled into the wrangling over how promises of lifetime benefits can be broken, or whether they existed at all. And the courts have not been uniform in their answers. Some predict that the U.S. Supreme Court will eventually have to step in to smooth out the wrinkles.
Read more here. ****** Attend Shally Steckerl�??s FREE one hour LIVE sourcing chat - don�??t miss Shally on the SourcersGuild network Tuesday, July 22 answering your Internet sourcing questions here!
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If you want to live a life of comfort and be able to retire without worry, don't...I repeat...DO NOT rely on any corporation to provide this for you.
You are not "entitled" to a living wage.
You are not "entitled" to a comfortable and worry-free retirement.
You are not "entitled" to free or low cost medical care.
Years ago one of the largest and most successful companies in US history, Lucent (now Alcatel-Lucent...home to Bell Labs) announced they were dropping all health benefits and death benefits for their retired employees. These were people who worked for this company their ENTIRE career and were now faced with no medical benefits and no monetary legacy (life insurance) for their families. Why? Because companies are founded on one principal...TO MAKE MONEY.
This is not a cynical view of the corporate world. But to think that any company was founded with any higher purpose is simply naive.
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In the long run moving operations overseas will have a negative impact on stockholder value. If people make decent wages they tend to make more purchases. They are more likely buy a bigger house, buy a new car for the garage, they need appliances and furniture for the house, perhaps they will buy new clothes. If they are making decent money, they will eat out more often, go on vacations, etc. When this happens companies will see an increase in revenues and most likely profits. The executives can give themselves a fat bonus and stockholders will most likely see an increase in dividend and an increase in shareholder value.
When companies move operations overseas to trim cost, this may look good on the financial statements in the short term but in the long term a large percentage of their customers have seen a large decrease in their income and must cut their cost, which means companies will see a decrease in revenues and profits and shareholder value will suffer. Who wins here?
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The injection of a difficult question will elicit a response among those brave enough to answer it . . .
However, upon answering, there are then posts to highly emotional articles such noting such irrational comments as 'This is a knife stab in the back'.
In essence, what is happening with the above scenario is an attempted and transparent move from the realm of rationality to the realm of emotion.
[As a Gen-X'er, I see this behavior among Boomers who have failed, and continue to fail, to accept the reality of the global economy. Is it any surprise that the GM employee referenced in the article is a Boomer himself?]
Since I'm not running for Mayor, and I am too an American affected by inevitable offshoring and outsourcing, I'll make the tough comment to any GM worker:
If you believed, at some point in time, in "the lifetime promise GM made to us" . . . then you need to take a hard look in the mirror instead of pointing fingers at those in the organization that had to make difficult decisions. You put your faith in the machine . . . ever ignoring the collapsing buildings of the U.S. automotive sector around you. Were the consecutive Billion-dollar losses not a cause for concern?
I've said it before, and I'll say it again, the point of a publicly traded company is to create shareholder value - nothing more, nothing less. The PR machine and employment branding efforts (such as BP's commercials on alternative fuels) are risk management moves.
Now, the individual managers (if they're decent people) want to do the right thing and want to keep everyone employed . . . but at the end of the day, the goal is to create shareholder value, not keep any group of people employed. It's tough medicine, even for myself, but it's reality.
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Unfortunately many of these people have several years before they qualify for Medicare. Maybe its time for CEO�??s of these troubled companies to give up part of their multi million dollar compensation packages.
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excuse me...I meant to write Medicare, not Medicaid.
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Maureen, re: the GM "victim" story...Given that GM is frantically trying to forestall bankruptcy, their stockholders will of course appreciate a wise decision on the part of GM to curtail or end healthcare benefits for those who qualify for Medicaid. It is easy for executive boards and CEOs in a fairly monopolistic industry such as auto manufacturing, living high on the hog, as they have been for decades, to promise the moon far into the future to its workforce. But adjustments must occur. Nothing can stay the same except in a vacuum, and those in the workforce can either ride the wave until it ends and consider the ride good and move on, or get off the wave and learn to climb a mountain instead. We really all end up the same; you can't take it to the grave.
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This is cop out kid, reporting. For example,
http://neweconomist.blogs.com/new_economist/2006/11/kramarz.html
"The paper shows that French unions who flex their muscles in the face of greater trade competition make things worse, by encouraging firms to oursource more jobs."
and
"Who made the decision to produce cars that no one wanted to buy? I don�??t believe the union is one developing strategy I think that is the job of the executives. "
This arguement is specious. The fact that design and marketing mistakes have lead to consequent market share drops does not exclude unions for magnifying the cost structure problem.
As I said, "part" of the problem, not the whole problem.
Most of what we're outsourcing is now petrodollars, if you will.
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Shell-shocked GM retirees react: 'This is a knife stab in the back'
Jul. 16--After years of getting generous coverage, retirees from salaried jobs at General Motors Corp. reacted angrily Tuesday to the announcement that GM was ending their health benefits.
"I'm disappointed in the lifetime promise GM made to us," said John Fleming, 67, of Rochester Hills, a retired information system auditor. "We've been wiped off the books completely."
Fleming was among the shell-shocked GM retirees wondering about what they'd do next for health care, following the surprise announcement that is part of GM's latest cost-cutting plan.
Effective Jan. 1, GM will end health benefits for 97,400 salaried retirees 65 or older, their spouses and dependents. Retirees will receive an extra $300 a month in their pension checks that could be used to buy health care.
"They want us to retire and then drop dead," said her husband, John Tessmar, 72, a former security supervisor who worked 28 years for GM. Whole story here.
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John, Good Morning. Hey, I was looking through the group this morning and noticed that my post from yesterday was removed.
I spoke on my comments about outsourcing and I included a link to my article, "Who Killed Kenny, The Name Sourcer", as well. Link: http://www.lgexec.typepad.com/
Here were my central thoughts:
I. Telephone Name Generation Training have created the global supply-demand imbalance that has commoditized name generation in the first place.
II. Telephone Name Generators in the U.S. don't want competition, because when supply goes up and demand remains constant, prices go down.
III. In the current Nano-World, names/titles/contact information are now being stored in low-cost online databases.
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I would not blame the union for the problems of the Automakers.
Who made the decision to produce cars that no one wanted to buy? I don�??t believe the union is one developing strategy I think that is the job of the executives.
Despite what everyone may think, the average union autoworker is not making $50/hr. The health benefits make up the largest piece of their compensation, these are the same benefits enjoyed by the non union workers and a small fraction of the benefits enjoyed by the executives. UAW members have giving up raises, in exchange for receiving health benefits after they retire now those benefits are at risk.
Poor business judgment is to blame for the condition of the automakers.
This is just my personal theory, I may be wrong, but I don�??t believe I am too far off. Despite what some politicians, business leaders and economist say, outsourcing jobs overseas is not good for consumers. Even though the cost of producing the goods decrease the savings are not passed on to the consumers they are going to the executives in the forms of bonuses and stockholders dividends.
If the trend of outsourcing jobs overseas continues, most Americans will be making $10 an hour, which will significantly affect the economy in a negative way.
The reality is outsourcing jobs overseas is not resulting in bigger and better opportunities here in the US. I�??ve seen it time and time again, people that once made good money, are now forced to work two jobs to make a fraction of what they once made. This is hurting families, communities, and in time it will hurt the American business. In this situation the average person will no longer be in a position to purchase new cars, houses, appliances, electronics, clothes or eat at restaurants. This will create a domino effect whipping out small business around the country. This will not only effect the average American worker, in the long run this will have a negative effect on corporate executives and professionals. Americans corporations will experience a drop in revenues, therefore effecting profits and executive compensation. The average person will no longer be in a position to hire attorneys, visit doctors or hire other professionals causing the salaries of professional workers to decrease.
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Assigning adjectives to the science of job markets, economies, and societal development such as "outrageous" is not very useful. Outsourcing is simply a "natural" response to the fact that the resources within the American job market and economy have developed to a certain point, and the resources within the job markets and economies in other countries (India and the Phillipines) have stepped in to fill the "wake" left by our development. If call centers in these countries are doing a "better" job than those here in the U.S., it may be because the jobs represent better opportunities to those filling them where they are then these same jobs do here. We have a greater choice of occupational opportunities here than they may have, due to a whole myriad of reasons...We have seen this before when clothing manufacturers outsourced piece goods to other countries, etc. This is nothing new. Industries will always seek the best value for their labor force dollar. This is the way it should be, because each individual in the labor force pool must offer the best value for the job market or they cannot stay employed for long. As T. Tallis says, labor unions have obstructed this basic principle for many years here in the U.S. This has led to huge losses within the auto industry, for example, even when the auto industry has outsourced many of its components to foreign interests in hopes of counter-balancing the growing costs and inefficiencies, caused by union demands, of their U.S. employees.
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Hello:
Can you recommend any FT Virtual Assistants (or firms that handle them) for $400- $650/mo? I've seen large numbers of listings of such folks, but would appreciate some direct referrals.
Thank You, Keith Halperin, keithsrj@sbcglobal.net 415.586.8265
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Mike and Jeff, I thought you guys would get a laugh out of my latest post/article about . . .
Who Killed Kenny, The "Name Sourcer"?
Just hop on over to: www.lgexec.typepad.com to check it out. Both you guys are referenced and there is even a picture of Kenny :)
For a primer, I take a deeper dive into the globalization and commoditization of names sourcing today and who really killed Kenny, the "Name Sourcer". Here are some of the central points:
I. Telephone Name Generation Training have created the global supply-demand imbalance that has commoditized name generation in the first place.
II. Telephone Name Generators in the U.S. don't want competition, because when supply goes up and demand remains constant, prices go down.
III. In the current Nano-World, names/titles/contact information are now being stored in low-cost online databases.
I would have posted it here, but want to continue owning my own material, so I couldn't. Have at it! :)
Joshua Letourneau Mg Director, LG & Assoc Search / Talent Strategies BLOG: www.lgexec.typepad.com
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It is partially true. There are no metrics that i am aware of that truly measures call centre customer satisfaction after offshoring.
If you were offshoring just credit card or some other bill payments related issues, the person on the other line need not be that smart enough.
If a company were to offshore helpdesk (infrastructure related), then i would definitely question the competence and the efficiencies.
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Don't believe the "SPIN" those efficiencies translate to a bottom line savings in employee expense.
"A chief executive who recently outsourced his customer call center to the Philippines and his IT help desk to India says the main reason was the much higher efficiency of those service providers - resulting in huge savings for his customers and his shareholders."
The only reason those "efficiencies" can be realised is because the hourly rate is so low in these off shore countries. In the USA min wage is about $8.00 an hour. In the Philipines they make $20 a month, that works out that they can hire 64 people for the price of 1 here in the US. No matter how you slice it, even if you pay the workers in the Philipines $120 a month you can hire 10+ to 1. When you have 10 times as many people answering the phones the caller doesn't need to sit on hold as long, up goes customer satisfaction, up goes profits cause you can probably get away with 5 people instead of 10 per every USA employee and keep the rest as profit.
Jeff Weidner jeffweidnerlinkedin@gmail.com
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If anyone's interested, I'd be happy to share a recent study on outsourcing/offshoring done by Booz Allen Hamilton and the Duke University Fuqua School of Business (Duke/Booz Allen Offshoring Research Network Survey) called The Globalization of White Collar Work - The Facts and Fallout of Next Generation Offshoring.
Essentially, their survey of 537 companies over 2 years revealed 5 principal insights that frame the study;
1) Labor arbitrage is giving way to accessing talent as the primary driver of next-generation offshoring 2) Offshoring high-skilled functions does not replace jobs onshore 3) Companies look elsewhere because they can't get it at home 4) Where you offshore depends on what you offshore 5) The obstacles to offshoring are increasingly internal and organizational
Send me an email at mike@avature.net and I will email you the complete study.
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Maureen, very good thought points. I have opinions from both sides because I work for a recruiting firm who outsouces all the internet research for our office and I also manage the operations of two off shore internet research companies. This is a bit selfish I suppose because by managing the operations of them I can control the quality of the work my recruiting firm gets from them.
I think the fact is, there are some companies who do certain jobs better than others. Whether they are off shore or not, less expensive per hour or not, shouldn't be the focus of your research in finding someone to outsource to. It should be more about the efficiency and quality of work they provide. I think most business owners would admit they'd be willing to pay more for a service, and off shore it, if they could get it done better. You really have to look at the overall cost of getting the work done, not just the cost of doing the work off shore.
eTelecare is a company who is absolutely fabulous at call center operations. They have operations off shore in more than one place and the fact is, they are better at it than most call centers here in the US. I worked for a large telecom for over 10 years and our service levels at our call center here in Phoenix were NEVER EVEN CLOSE to the levels of service eTelecare can provide it's customers.
If price is all your are worried about you are probably not going to find a good balance of cost and quality of work.
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Blaming Unions is cop out answer.
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Part of the problem here is unions.
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