OPINION: Cultural Harmonisation versus Greed
You can’t outsource greed – it is too close to home. Over recent years, many large corporations have seen offshoring and outsourcing as a means to increase “shareholder value”. Huge outsourcing corporations have grown from innovative deployment of talented, well-educated, underpaid workforces. Now it is time to step back from the cookie jar and look at what we may learn from our trail of crumbs…
We are not smarter than our outsourcing ancestors. We have the opportunity to build on lessons we have learned from their smartness. Otherwise we become victims of our own greed, ignorance and laziness (adapted from Andrew Marr’s History of the World).
Haste to be Number One in global outsourcing has highlighted labour arbitrage and attrition as significant challenges for providers. Timezone proximity, cultural affinity, quality of service and risk mitigation (not least information security) have combined to create a sufficient overhead, to call into question the real value of some outsourced relationships to corporate clients.
I say we stop screwing each other on price and focus on delivering quality not quantity. Stop the search for cheap labour, it is a temporarily exploitive fallacy.
If an outsource provider excels in quality, then by all means let it open offices close to the targets of its global reach. In addition, I believe that corporations should help deliver long-term strategic development to the economies in which it operates. Feed the economy that feeds you; create employment as near to locally as possible, and pay the taxes!
Recent developments in near-sourcing in the US are encouraging indigenous employment, and a significant growth in Latin America. The model appears to be working from what I understand.
I was at the Shared Services & Outsourcing Week in Orlando recently, where a panel of various country advocates was asked: how do you choose the right location for your outsourcing or service centre? Panellists predictably promoted their home turfs, before Professor Phil Taylor of Strathclyde University, gave the right answer for me. Professor Taylor explained that there is no single choice; just what works best for you, in terms of locally skilled and educated workforce, capacity, and a cultural harmony. Attributes that, coincidentally Scotland has in abundance!
I strongly believe cultural harmonisation to be of enormous value. Abandon thoughts of labour arbitrage, and automate wherever possible. Where the cloud fits – use it. The increased visibility from your process dashboard, and the control you can exercise locally make for more effective and efficient management. Don’t travel for two weeks of your month to manage your outsource provider, sit next to your budding apprentice, your struggling junior and guide them in your ways, in your time – in-house, or outsourced, they are part of your team. What price do social interaction and humour have in your workplace?
The value of your outsourcing relationship will be greater than any cost-saving.
Andy Scott is a governance, risk management and compliance expert with deep experience in financial process automation, sales and marketing management.