A client recently forwarded me an invitation from a company promoting a seminar titled “How to make off-shoring work?” He rightly pointed out that if your asking the wrong question, you will get the wrong answer. After all, it isn’t about getting off-shoring (or outsourcing, shared services, etc.) to work, it is about getting the work to work better.
The problem is (as with most fads) they are based in assumptions. Here is the one that caught my attention in the promotion:
“Most major corporations have embraced offshore delivery of IT and are moving to the next stage of a global delivery model, in which the location of both supplier and internal resources are decided from a business perspective, with very few duplicate roles across the world. With major economic benefits, this transition has been accelerated by the economic developments of 2009. What are the challenges? What are the opportunities? And how can you make it work for you?”
Obviously someone with a vested interest in convincing an audience that off-shoring is the right thing to do and you would be ignorant or stupid to have not embraced it as this point. No evidence, just a lot of hype from a major consulting firm that is trying to sell the mirage.
Too many companies will fall into the cost trap of such claims. They will do this because they see a reduction in activity costs . . . a very short-term thinking proposition. But with executives salivating over bonus potential in the next quarter, reducing activity costs sounds appealing. They miss huge improvement opportunities with this thinking by not addressing the design of the work BEFORE considering off-shoring, outsourcing or shared services. This is the fundamental thinking problem that management must overcome to improve service.
Off-shoring, outsourcing and even a shared services strategy have gone from a snowball to an avalanche without proof of total cost reduction. If companies would see that they are off-shoring the waste that is in the design of the work, I believe a different approach would be in order to achieve business improvement.
Tripp Babbitt is a speaker, blogger and consultant to service industry (private and public). His organization helps executives find a better way to make the work work. Read his articles at Quality Digest and his column for CustomermanagementIQ.com Download free from www.newsystemsthinking.com “Understanding Your Organization as a System” and gain knowledge of systems thinking or contact us about our intervention services at [email protected]. Reach him on Twitter at www.twitter.com/TriBabbittor LinkedIn at www.linkedin.com/in/trippbabbitt.