How Essential is the Offshoring Panic Really?

Joan Marques - Ed.D., MBA.
Burbank, California

If you just limit your searches to published articles on the topic of offshoring for one month, you'll have material to read for a day. And that's exactly what I did in order to find out what the progresses in the upheaval around this phenomenon have been recently.

Overall, it seems that a more rational approach toward offshore outsourcing has emerged, now that the first panic outbursts have subsided. The tone of articles is less alarmed and more analytical, whereby the predominant piques are:

    1) Offshoring is not a new trend: we've faced it for several decennia. For instance, when we allowed manufacturing jobs to shift to overpopulated, and thus cheaper economies. But that did not panic us then: we simply transformed into a service-based economy. So what is the big worry now that the possible next shift is approaching?

    2) Returning to protectionism in a world that is increasingly intertwining would be the most shortsighted thing to do by any government. It would not only create hostile attitudes from those who have been opening their borders to globalization when it was beneficial to the industrialized countries, but it would also represent a setback in development for all stakeholders, which are all countries in the world.

    3) Offshoring has its limitations for various reasons. The immediacy of certain services comes to mind here: you cannot have your haircut done over the Internet, and you certainly cannot have a paramedic or a firefighter fly over from Bangalore to solve your pressing issue. And as for the telephoning services: there is something to say about a customer service representative being able to relate to your perceptions as opposed to one who constantly needs his catalogue and dictionary to continue a decent conversation.

    4) Offshoring is in effect on all fronts: just as dreadful as the U.S. and Western Europe consider losing jobs to India, Japan, China, Slovenia, or Lithuania, just as dreadful do these countries find it when their intellectual cadre, and sometimes entire industries, move across country borders, or entire oceans in order to establish themselves in the U.S. or Western Europe, where they see more opportunities.

    5) Offshoring is not as simple as many companies initially seemed to think. The additional troubles with training, traveling, culturally adapting, and communicating have gradually been surfacing, making Human Resource departments press for more influence in the decision making processes when an organization considers offshore outsourcing.

    6) Offshoring has also caused a number of companies to see their clientele heading toward competitors, as they are concerned with the handling of delicate personal information in annals that are located in countries that may not have similar ethical- and moral codes.
7) Offshoring has already ignited new trends. The first signs of shift awareness have been manifesting themselves: a growing number of job market analysts recommend more concentration on creative jobs, and less on repetitive ones. This implies a rethinking of study foci in higher education. For instance: a) Finance should be preferred over accounting as a study major, because the financial manager needs to be on location to inventively respond to eventualities, while accounting processes can be easily executed overseas. b) Engineering should definitely be encouraged, as it will provide the brains and, therefore the insights that will shape the new focus in our economy. c) Entrepreneurship should be supported, since "lean and mean" may be the best and most efficient way to respond to all troubles.

Overall it seems that the level to which one should worry about offshore outsourcing has very much to do with one's work area. Some have more reasons to develop immediate action than others. However, it is always wise to continue measuring one's applicability level in the local- as well as the global market; engaging in continuous education, especially in those service areas that cannot be exported; and trying to have as many irons in the fire, in order not to depend too much upon one single source of income at any time.