Outsourcing is nothing new, but recent outsourcing is different, both in the nature of the activities we're outsourcing, and where the sources are. No longer do we outsource only manufacturing; no longer are the source countries all industrial powerhouses. Today we're outsourcing thought work, too, and the source countries — India, the countries of the former Soviet Union, and Eastern Europe, for the most part — have large numbers of people who can think.
Outsourcing now threatens the jobs of engineers, scientists, doctors, technicians, and decision-makers — people who are much closer in demographic type to the people who make the outsourcing decision. As decision makers, we're now outsourcing the jobs of one another's friends and relatives.
Since what we're doing might have a direct and negative impact on our lives, it pays to examine it more closely than most of us have done so far. Here are just a few issues that any outsourcing plan should address.
- Bright flight
- People whose jobs haven't been outsourced might believe that they haven't been outsourced yet. Since the brightest of these always have alternatives, they might depart preemptively, and you could end up losing people whose jobs you had no intention of eliminating. Retention costs money, and losing good people costs even more. How much?
- Uncontrolled transfer of insights
- If your supplier develops an innovation or acquires an insight, will you ever become aware of it? Can that innovation or insight propagate to your competitors? If it did, in violation of your contract, how would you know?
- Routine miscommunications
- Outsourcing now threatens
the jobs of those
in the same demographic
as the decision-makers
- Cultural and language differences, and less effective person-to-person relationships, can lead to increased incidence of miscommunications. Although both parties to a communication might feel that they understand, they often have strikingly different understandings. Colossal errors are possible. How often will they happen? How much will they cost?
- Healthy in-house teams can deliver results more quickly than outside vendors can. For instance, when the vendor resides in a time zone 10 to 12 hours away, a typical round trip communication by voicemail or email can take a day or more. What's the cost of these and the dozens of other similar delay phenomena? What's the cost of a six-month extension of time-to-market?
- Forced "progress"
- Suppliers provide lower prices not only through lower wages, but also by spreading costs across multiple clients. As they gather more clients, the heterogeneity of their client base increases. Unless the supplier can encourage technology homogeneity among its clients, sharing costs becomes more difficult. Could you be compelled to upgrade systems against your will? What would be the cost of forced progress?
Failing to include all costs in your financial projections can lead to performance below what you've promised. And then your employer might encourage you to consider outsourcing not only your friends and relatives, but yourself. Top Next Issue
Much is available in the business press about outsourcing and offshoring. A recent accessible example is by Scott Thurm: "Lesson in India: Not Every Job Translates Overseas," The Wall Street Journal, March 3, 2004, p A1.
For an overview of some novel retention tactics, see "Retention," Point Lookout for February 7, 2007.
Are your projects always (or almost always) late and over budget? Are your project teams plagued by turnover, burnout, and high defect rates? Turn your culture around. Read 52 Tips for Leaders of Project-Oriented Organizations, filled with tips and techniques for organizational leaders. Order Now!
Your comments are welcomeWould you like to see your comments posted here? rbrenRBGvfVlaJChwTCFwner@ChacqjBeckpVDVNAgjbKoCanyon.comSend me your comments by email, or by Web form.
About Point Lookout
Thank you for reading this article. I hope you enjoyed it and found it useful, and that you'll consider recommending it to a friend.
Support Point Lookout by joining the Friends of Point Lookout, as an individual or as an organization.
Do you face a complex interpersonal situation? Send it in, anonymously if you like, and I'll give you my two cents.
More articles on Organizational Change:
- Pick-Up Sticks and the Change Game
- When we change organizational culture, we often stumble over unexpected obstacles. Sometimes the tangle
can be so frustrating that we want to start the company over again. Here are some tips for managing
large-scale cultural change.
- Plenty of Blame to Go Around
- You may have heard the phrase "plenty of blame to go around," or maybe you've even used it
yourself. Although it sometimes does bring an end to immediate finger pointing, it also validates blame
as a general approach. Here's how to end the blaming by looking ahead.
- The Ties that Bind
- Changing anything in an organization reveals how it's connected to its people, to its processes, to
its facilities, and to the overall context. Usually, these connections reach out much further into the
organization than we imagine.
- Comfortable Ignorance
- When we suddenly realize that what we've believed is wrong, or that what we've been doing won't work,
our fear and discomfort can cause us to persevere in our illusions. If we can get better at accepting
reality and dealing with it, we can make faster progress toward real achievement.
- How to Find Lessons to Learn
- When we conduct Lessons Learned sessions, how can we ensure that we find all the important lessons to
be learned? Here's one method.
Forthcoming issues of Point Lookout
- Coming December 20: Conceptual Mondegreens
- When we disagree about abstractions, such as a problem solution, or a competitor's strategy, the cause can often be misunderstanding the abstraction. That misunderstanding can be a conceptual mondegreen. Available here and by RSS on December 20.
- And on December 27: On Assigning Responsibility for Creating Trouble
- When we assign responsibility for troubles that bedevil us, we often make mistakes. We can be misled by language, stereotypes, and the assumptions we make about others. Available here and by RSS on December 27.
I offer email and telephone coaching at both corporate and individual rates. Contact Rick for details at rbrenrwGPPMRBYsntHyQIner@ChacbTIZZzpnOZoprkCsoCanyon.com or (617) 491-6289, or toll-free in the continental US at (866) 378-5470.
Get the ebook!
Past issues of Point Lookout are available in six ebooks:
- Get 2001-2 in Geese Don't Land on Twigs (PDF, USD 11.95)
- Get 2003-4 in Why Dogs Wag (PDF, USD 11.95)
- Get 2005-6 in Loopy Things We Do (PDF, USD 11.95)
- Get 2007-8 in Things We Believe That Maybe Aren't So True (PDF, USD 11.95)
- Get 2009-10 in The Questions Not Asked (PDF, USD 11.95)
- Get all of the first twelve years (2001-2012) in The Collected Issues of Point Lookout (PDF, USD 28.99)
Are you a writer, editor or publisher on deadline? Are you looking for an article that will get people talking and get compliments flying your way? You can have 500 words in your inbox in one hour. License any article from this Web site. More info
- Person-to-Person Communications: Models and Applications
- When we talk, listen, send or read emails,
read or write memos, or when we leave or listen to voice mail messages, we're communicating person-to-person.
And whenever we communicate person-to-person, we risk being misunderstood, offending others, feeling
hurt, and being confused. There are so many ways for things to go wrong that we could never learn how
to fix all the problems. A more effective approach avoids problems altogether, or at least minimizes
their occurrence. In this very interactive program we'll explain — and show you how to use —
a model of inter-personal communications that can help you stay out of the ditch. We'll place particular
emphasis on a very tricky situation — expressing your personal power. In those moments of intense
involvement, when we're most likely to slip, you'll have a new tool to use to keep things constructive.
Read more about this program. Here's a date for this
- Embassy Suites by Hilton Jacksonville Baymeadows, 9300 Baymeadows
Road, Jacksonville, Florida, 32256, USA: January 15, 2018,
Monthly Meeting, Northeast Florida Chapter of the Project Management Institute. Register now.
- Embassy Suites by Hilton Jacksonville Baymeadows, 9300 Baymeadows Road, Jacksonville, Florida, 32256, USA: January 15, 2018, Monthly Meeting, Northeast Florida Chapter of the Project Management Institute. Register now.
- Ten Project Management Fallacies: The Power of Avoiding Hazards
- Most of what we know about managing projects is useful and effective, but some of what we know "just ain't so." Identifying the fallacies of project management reduces risk and enhances your ability to complete projects successfully. Even more important, avoiding these traps can demonstrate the value and power of the project management profession in general, and your personal capabilities in particular. In this program we describe ten of these beliefs. There are almost certainly many more, but these ten are a good start. We'll explore the situations where these fallacies are most likely to expose projects to risk, and suggest techniques for avoiding them. Read more about this program. Here's a date for this program:
- The Power Affect: How We Express Our Personal Power
- Many people who possess real organizational power have a characteristic demeanor. It's the way they project their presence. I call this the power affect. Some people — call them power pretenders — adopt the power affect well before they attain significant organizational power. Unfortunately for their colleagues, and for their organizations, power pretenders can attain organizational power out of proportion to their merit or abilities. Understanding the power affect is therefore important for anyone who aims to attain power, or anyone who works with power pretenders. Read more about this program.
- Your stuff is brilliant! Thank you!
- You and Scott Adams both secretly work here, right?
- I really enjoy my weekly newsletters. I appreciate the quick read.
- A sort of Dr. Phil for Management!
- …extremely accurate, inspiring and applicable to day-to-day … invaluable.