Think Long & Hard About Offshoring
Like outsourcing, but over more time-zones in different languages and cultures, offshoring is a huge step to take if you haven't done it before. Getting it right can open up new avenues for increased productivity for a whole host of your organisation's business processes. Getting it wrong can mean the "O word" is never mentioned again and your organisation is burdened with costs that competitors have long since divested.
Offshoring Models – Take Your Pick
Should you be considering a lower risk & reward partnership with a Big Four consultancy who own the offshore relationships or a more "do it yourself" approach where you put all the offshore supplier relationships in place? On the other hand would you prefer to acquire or establish a business offshore? The typical risks and rewards of the models can be significantly different, so take a bit of time getting this decision right. Some companies take a progressive approach; they get help with the earlier offshored processes, and then ultimately transition to establishing their own organisation offshore.
Before You Do Anything
If you haven't offshored before, consider offshoring "back-office" rather than "front office" processes first and don't try to reinvent the wheel. Start by getting good quality advice, which means using someone who's "been there" and "done that" before. If you're not partnering with a "Big Four" consultancy and you can't wait for headhunters, try interim management service providers, but whichever route you opt for, don't take a risk on someone who looks good, but actually hasn't done it before. You'll need someone who knows what actually happens, who really knows the key risks and how to mitigate them; someone who knows which are the emerging markets and those which are more mature. Once you've found your experienced offshorer, give them unambiguous terms of reference and then build a full time multi-disciplinary offshoring team around them. If you think you can't afford to build a multi -disciplinary team, for the duration of the project, think again. Can you afford not to?
What's The Worst Case Scenario?
Before you go much further, get the team to work out what the likely benefits will be and also what your offshore disaster recovery plan is going to look like and cost. The latter may be a rapid re-onshoring of the process, but whatever it looks like, it's best to know what the worst case scenario is and decide whether the risk-reward ratio is right sooner rather than later.
Consider Re-Engineering Before Offshoring
In the rush to offshore, most companies overlook this, but whichever model you choose it's better to optimise your processes before you offshore them. This has several benefits. It ensures that the key steps to process success are documented formally, rather than them remaining carefully guarded secrets in your employees' heads. Understanding current process performance also helps to develop confidence about what level of improvements are likely to be achievable. The application of lean techniques can reduce the cost of a business process (before offshoring) by between 20-30% and reduce in process inventory levels and lead times by 50%. That way you capture the savings before the transition to offshore, otherwise your eventual supplier will retain them. Importantly simplification will help to make the process more robust, whoever's ultimately operating it.
Engaging With Offshore Suppliers
Identify what the key success factors for an outsourced relationship are, and issue a Request for Information (RFI) to potential suppliers. From this identify what additional benefits the offshore suppliers should be able to provide because they are specialists in the field.
Be absolutely clear about what your performance expectations are from the beginning. Set these as objectives when you first meet with long-listed suppliers, and repeat them for conditioning purposes at every important meeting. Back this up with a contract which includes comprehensive service level agreements (SLAs) as schedules; and where you want ongoing performance improvements draft clauses with win-win incentives.
Make sure that you get your "supplier quality assurance" assessments right. Run in-depth diagnostics inside the short-listed suppliers' businesses and let your process experts find out how suppliers really do things.
If you've comprehensively specified your requirements, give serious consideration to using e-Sourcing (e-Request for Information, e-Request for Quotation & Reverse e-Auctions) to minimise suppliers' prices, but don't forget to take account of any fixed costs which will be left behind and will have to be shared amongst the remaining onshore cost centres.
When you've selected your supplier, you can run "on-shore" trials with "offshore" employees to prove the concept and develop and train supplier "super-users", then run "offshore" pilots, before rolling the solution out on a grand scale.
Then when the relationship is established put full time supplier relationship managers in place, who understand in detail how the onshore process worked, and will work inside your offshore suppliers to drive continuous improvement against the SLAs and maintain service quality.
Conclusion
Yes offshoring has its risks, but a carefully managed project led by someone who really knows what they're doing, can open up an entirely new range of opportunities to improve business performance.
David Jones works for Executive Interims - Supply Chain Practice providing supply chain interim management services - see http://www.executive-interims.co.uk/interim_management/interim_management.asp .
The Importance Of Reaction And Emotion To Your Home-based Online Business
Once you have an online business idea, you must then promote your product and service in order to obtain a reaction. And this is because products and services are bought on emotion...
Look at the cars being driven today if you don't believe me!
There are plenty of good cars that can be bought for a very modest price, so why do people insist on paying lots more for a newer "more sporty" version?
It's because of status and "what the neighbors' will think"!
Also...
You're not going to sell your online business product to everyone, so why not prompt a positive reaction to those that you think will buy your online business product or service by saying something like:
'Quite frankly, the American Express Card isn't for everyone'
(This was an extremely successful ad run in the US).
Now this makes people desire the card, because they don't want to think that they wouldn't be able to obtain one for any reason, but also the ad is focused and targeted towards those that would WANT such a card in the first place - as a status symbol...
So, in short, start thinking about who your online business customers and clients are going to be – then all you need to do is prompt a reaction to bring those people on board...
Remember, your online business products and services will be sold on emotion, then justified logically...
So, by now you may be asking the following questions about your home-based online business:
"How do I obtain a reaction?"
"How do I encourage people to buy on emotion?"
And the only way in which I can answer these questions is to direct you to the following link... You either love this or you hate it, but importantly, if you love it, you'll buy and if you don't... you probably weren't going to buy anyway!
http://cdcmltd.richjerk.hop.clickbank.net
Take a look and you'll soon understand what I mean when I say you're not going to sell your online business product to everyone, so why not prompt a positive reaction in those that you think will buy.
Remember, your online business products and services will be sold on emotion, then justified logically...
Click below to see an extreme example of this: http://cdcmltd.richjerk.hop.clickbank.net
Chris Cobb
http://www.internet-profit-opportunities.com
Outsourcing: Threat or Opportunity?
You have permission to publish this article free of charge eitherelectronically or in print, as long as the bylines are included.A courtesy copy of your publication would be appreciated.Outsourcing: Threat or Opportunity?In the past few months concerns about outsourcing have surged to trulyvexing proportions in almost all sectors of the U.S. corporate world. In arecent edition of the Wall street Journal, Maher (2004a) presents astatement by John McCarthy, vice president of Forrester Research Inc., whoestimates that "as many as 588,000 U.S. white-collar jobs will beæoff-shoredÆ by 2005 -- and a total of 1.6 million by 2010" (p. B1).While in the not so far past mainly lower level jobs were exported tocountries offering low labor costs, today every profession is in jeopardy,even the jobs of accountants, analysts, tax-professionals, architects,attorneys, radiologists, or technical writers, to name a few. The idea oftelecommuting has expanded: the positive sound that this job flexibilitytool used to have is not so positive anymore. Once upon a fairly recenttime, telecommuting was perceived as a way to keep good workers active byaccommodating them through working from home. However, this phenomenon hasnow expanded to a scale where workers donÆt just work from their home in thenext street, neighborhood, or town, but in the next continent as well!The telecommuting shift has, thus, resulted in an elevation of the educationlevels of jobs that are crossing borders. So, what does the picture looklike today? No matter whether you are a worker at the lowest echelon of anorganization, or a top performer with an advanced degree, your job can beexported next year, next month, or even next week.As soon as you find out that the U.S. company you work for has testedBangalorian, Coimbatorian, or any other transcontinental waters, you canstart counting down. And not even obtaining higher education will keep yourjob secure anymore! No wonder that more and more people get nervous aboutthis whole trend: globalization was supposed to be a positive development,not a threatening one.Before offering some positive attitudinal suggestions regarding outsourcing,here is a point to ponder: long before this trend became a reason forconcern in the industrialized world, globalization was a nightmare to thelesser-developed, smaller-scale producing countries of this world. For thelongest time these countries were beleaguered by mass production from theirindustrialized "brothers and sisters," who could afford infinitely cheaperand larger scale production due to their massive and advanced setups.Becoming a partner in a regional trade community simply meant moreprosperity for the prosperous, and more poverty for the poor. Borders had tobe unlocked for giants who could now freely expand their state of the artservices to neighbors who were still struggling with old-fashionedproduction processes and meager performance levels.And now these "poor" countries are finally gradually emerging from theirdesolation: they offer their services on-location and through the Internetto corporations from industrialized countries, and obtain jobs at thesecorporations for a salary, considerably higher than what they used to getpaid at home, yet significantly lower than what these corporations would payto the workers in the industrialized home country! And that is what thisentire outsourcing issue looks like from the other side of the mirror.So, now that this has been placed on the table, here are some suggestionsfor workers in countries that endure job losses through outsourcing:* Polish up your entrepreneurial skills. Smaller, lean-and-mean operationswill have longer endurance than mammoths with little or no flexibility."Seek out new possibilities outside your company," suggests Maher (2004b, p.B8). This author refers to our human inventiveness by predicting that theoffshoring of jobs will ultimately create new entrepreneurial opportunities.Maher cites Bharat Desai, chairman and chief executive of technologyoutsourcing company Syntel Inc., who declared, "The more repetitive jobswill go offshore, because it will be more cost effective and higher value todo that," (p. B8) This means that the less repetitive jobs will stay!* Enlarge your horizons. Try to find out in what other industries than theone in which you are currently working your skills can be applied. Then,familiarize yourself with the wheelings and dealings of that industry, justin caseà* Engage in some in-depth self-exploration in order to find out what otherwork-preferences you have. Then, see what you can do to increase yourcapabilities in those other areas as well. The more diverse your skills, thegreater your applicability in the rapid changing global work environment.* Read! Listen! Surf the Net! Travel! Do everything you can to familiarizeyourself with other environments than the one you are currently in. It maysound like an unrealistic, even silly suggestion, but think of all thepeople who have changed environments in the past for their betterment. Ifthey could do it, you can too. If the world is becoming a global village,and we are all becoming "citizens of the world," we may as well getourselves comfortable in our new, enlarged "home," right? Besides, even ifyou donÆt want to go anywhere, it is always a plus to at least know whatÆsgoing on out there.Here are, at the end of this little contemplation, two positive notes toboost motivation:1. Threats can be seen as opportunities. And people are generally known fortheir resilience in turbulent times. In a recent Fortune article thefollowing statement was posted: "One of the greatest assets of America, sounderestimated there but so attractive to outsiders, is the ability of theU.S. to compete and come out on top, yet to absorb periodic shocks. I don'tfeel America is going to lose its economic dominance in any manner"("Outrage Over Outsourcing," 2004, p. 32).2. Even outsourcing and the entire trend of globalization have theirlimitations. As Maher (2004a) puts it: "Geographic and cultural differencescan make it hard for overseas workers to take over highly sophisticatedjobs" (Maher, 2004a, p. B1).In conclusion: Whether we choose to perceive outsourcing as a threat of anopportunity depends on our mindset, our actions, and most of all: ourapproach. As one of the four noble truths in BuddhaÆs teaching tells us, "Aswe are the ultimate cause of our difficulties, we are also the solution. Wecannot change the things that happen to us, but we can change our responses"("The four noble," Â4).References:Anonymous. (2004, March 22). Outrage Over Outsourcing. Fortune, 149, 32.Maher, K. (2004a, March 23). Next on the Outsourcing List; Job Shift toCheaper Countries Could Threaten More Careers: Analysts, Architects,Attorneys. The Wall Street Journal, pp. B1.Maher, K. (2004b, Mar. 23). What to Do if You Fear Your Job May Go Abroad.Wall Street Journal, pp. B8.Unknown. the four noble truths. FWBO.org. Retrieved on March 24, 2004, fromhttp://www.fwbo.org/fournobletruths.htmlJoan Marques, Burbank, March 24, 2004---------------------------------------------------About the Author:Joan Marques emigrated from Suriname, South America, to California, U.S., in1998. She holds a doctorate in Organizational Leadership, a MasterÆs inBusiness Administration, and is currently a university instructor inBusiness and Management in Burbank, California. You may visit her web sitesat http://www.joanmarques.com andhttp://www.spiritcounts.com Joan's manual "Feel Good About Yourself," a six part series to get you overthe bumps in life and onto success, can be purchased and downloaded at:http://www.non-books.com/FeelGoodSeries.html-----------------------------------------------------It is better to live in serene poverty than in hectic affluence. Everythinghas a price. The price for nurturing your soul is turning away fromexcessive stress, destruction of self-respect, and the constant strive inlifestyle with the Joneses. But itÆs worth it.[Non-text portions of this message have been removed]
