Is offshore Outsourcing Only Just About Low Employment Cost?

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By Roy Jonathan del Rosario

The chief reason for offshore outsourcing, as what has always been cited in many articles and studies conducted by professionals and globally-known economists, is the extremely low employment cost in Asian countries such as the Philippines and India. But offshore outsourcing has various factors to consider in choosing what destination would be the best, or if not, the better choice. And all aspects count no matter how little they seem for as long as they can contribute to the success of the company.

But there are factors that are strongly observed by the outsourcing companies. And many economists believe that this factor is the second best aspect to be considered in choosing the best destination for offshore outsourcing – the skills match. Filipinos are said to be the most closely-aligned people to Americans in terms of customs. Filipinos are hired by American companies due to their American-influenced culture that is why Filipinos are dubbed as the most Americanized nation in Asia since the Philippines has been under the American rule in the time of the Spanish-American war in the later years of 1890s. Filipinos deal with Americans in the most natural way that is why they can carry instructions and troubles in such a good manner.

On the other hand, Mexico has been chosen by a transaction processing-company which is known for its expertise in healthcare and publishing global content outsourcing because it has similar time zone with the other American states and the destination is very near to be visited for other company processes.

China, as least expected, has a great advantage too though they are not that proficient with the English language and not very familiar with he western culture. As economists say, it is China that is the best destination for sending routine data entry work. The main reason is that most of China’s workers don’t speak English. By this fact, they can type quicker because they don’t take time to read the English words they encode. They just have to recognize the letters and punctuation marks then encode. But the disadvantage is that the computer sometimes also commits mistakes which only people can correct. Since Chinese don’t understand English that well, it might be a big hindrance to them.

To top it all, it can be inferred that it is also an important factor to have a close tie with the skills, culture and the people of the employing transnational company to be chosen as one of their offshore destinations and to be able to create a good communication and working relationship with them.

Source: http://www.outsourcing-journal.com/oct2004-cost.html

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