Perhaps there has been no business strategy that gained no criticisms at all. The cynicism of man has lingered in every facet of life and business is indeed no exception. Right after the outsourcing industry boomed in the global society, it has gained criticisms from skeptics, the major three of which, are cited below.
Dell Computer, one of the largest computer industries in the world, outsourced its customer support operations in India. Their customers’ reaction was negative. Aside from their heavy Indian accent, US customers criticize the incapacity of the outsourced employees to show work ethics to the Dell customers. Indeed, one of the chief criticisms received by outsourcing is the low quality of service outsourced employees give. Since outsourced employees are not direct agents of the company, debates arise that these employees are less likely to show work ethic as agents of the company. Unlike direct employees who receive incentives and salary straight from the company, some outsourced workers show no pride of representing the company for the customers.
On the other hand, outsourcing enables companies to gain freedom in choosing their service providers. If the product quality suffers because of poor service of outsourced workers, companies are free to move that particular business function back to the company operations. From a range of outsourcing firms with different specializations, they can also choose another service provider.
Another major criticism of outsourcing, particularly offshore outsourcing, is its threat on U.S. jobs. From the American perspective, the transfer of labor to foreign countries jeopardizes the U.S. economy. The answer of outsourcing to this issue is best explained by Economist Thomas Sowell of the University of Chicago. Sowell said that anything that boosts economic competence, whether by outsourcing or any other practice, is likely to cost somebody’s job. Modernization, for instance, cost jobs of millions of farmers. Yet, a few years later, they found higher paying jobs offered by modernization itself.
As outsourcing grows, security issues also arise. Critics protest against companies providing sensitive customer data to external firms. In April 2005, a theft case of $350 000 took place when Indian call center agents used passwords of customer accounts to transfer money to their own. This raised question of security in the outsourcing industry. Yet, outsourcing has answers to this issue. Such delinquency can take place anywhere, not just by outsourcing. Hence, outsourcing-related fraud should not be blamed on the industry, as this happens in any aspect of the business industry.
Unquestionably, outsourcing is no perfect. Nonetheless, with correct choice of outsourcing firm, these rational flaws comprise a very small aspect of outsourcing compared to its countless advantages. Just like any other industry, outsourcing is a matter of choices and risks. Considering the several rewards outsourcing can cause to your business, are you ready to take the risk?
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