Outsource: competing in the global productivity race

1. Introduction 2. Key factors driving outsourcing Introduction The influence of lower-cost workers Secondary factors : productivity and quality 3. Additional factors : availability, manageability, and so on New factor : dramatic improvements in infrastructure New factor : political changes New factor : the post-dot-com recession 3. Today's situation in IT Introduction Data entry Call center/help desk Maintenance/enhancement work and infrastructure admin support Traditional software development : body shop, project, full IT department replacement Creation and marketing of software products 4. Additional forms of outsourcing Introduction Data entry : the bottom of the food chain Call-center/help-desk services Back-office work Clinical trials Insurance claim processing Mortgage/loan applications Tax filing and regulatory filings Financial/market research Legal work Conclusion : what about your profession? 5. Likely trends for the next decade Introduction Offshore IT and call centers are now mainstream May other industries are where IT was in the mid-1990s Work is expanding to other countries : China, Eastern Europe, and others Potential "external" factors Political backlash Terrorism/war Economic upheavals Other industries provide models Possible novel twists on outsourcing Personal outsourcing

6. Implications for the individual

Introduction

Initial caveats

Is outsourcing a "blip" or a "sea change"?

It's unlikely to be all-or-nothing, unless you're in a one-company town

Political "protection" unlikely, at least in the short term

Variations for the individual

Age, years of experience

Salary

"Commodity" nature of skills/profession

Flexibility : the ability to shift quickly

Strategies

Be proactive

Quantify and protect your "cost-benefit" value proposition

Look for innovative or specialized niches

Be prepared to work harder

Be prepared to relocate

Consider going out on you own

Consider a career change

Ethical issues

What should you tell your kids?

7. Implications for companies supplying knowledge-based services

Introduction

General strategies

Revisiting the strategies for individuals

Be proactive

Quantify your "cost-benefit" vale proposition

Look for innovative or specialized niches

Be prepared to work harder

Be prepared to relocate geographically

Consider starting your own business

Consider changing careers

If you can't beat them, join them

8. Implications for companies buying knowledge-based products or services

Introduction

Traditional outsourcing issues

Don't outsource core competencies

Don't outsource what you can't manage in-house

Start small, with a pilot project

Measure your expectations with service level agreements

Learn from veterans

Peopleware issues

Giver your employees a chance to compete

Don't expect employees to be dupes

Treat outsourced employees honestly and fairly

9. Implications for government and society

Introduction

Objectives and strategic focus

The Wal-Mart factor

What role should the nation's leaders play?

Strategic focus : top down or bottom up?

Protectionism

A non-jobs protectionist issue : security and privacy

National investment in what makes us competitive

Encourage immigration

Invest in education

Invest in infrastructure

Change tax/accounting rules to encourage long-term investment in workers and productivity improvement

Conclusion

10. Conclusion

Introduction

Other issues besides offshore outsourcing

America itself practiced offshore outsourcing of knowledge-based products and services

Outsourcing is not a new phenomenon

Your future is in your hands.