2006-10-25

The Future Direction of Outsourcing

This could be considered as one of the most asked question which companies ask in regards to this kind of business strategy. If you would remember, outsourcing was met with negative reactions from the day it was implemented by different companies. As time passed by, reactions and opinions regarding outsourcing have changed considerably. Some people view it in a more open-minded manner but some people still say negative regarding the said business strategy.

The answer regarding the future of outsourcing was answered by Mohanbir Sawhney, considered as one of the 25 most influential people in e-business by Business Week. He replied stating that:

If one was to draw a diagram of job losses due to outsourcing, it would be an hourglass with the blue-collar jobs at the bottom and the white-collar jobs at the top getting hit the most. As India and China resort to more skill-oriented outsourcing, the questions that the US would increasingly need to ask are: why should a software guy with the same qualifications be paid more in the US, when there is a similar guy in India willing to do the same job at one-fourth the cost. Even more, the outsourcing model will spread to other sectors as well where you would be forced to outsource your non-core processes.

 

[Back]