Wednesday, September 05, 2007

Two muddles in the outsourcing debate

Public debate over outsourcing has been marred by two sets of serious muddles, frets the essay. “The first set of muddles relates to what is meant by outsourcing.” According to some, the word goes “beyond purchases of offshore arm’s length services to include, without analytical clarity, phenomena such as offshore purchases of manufactured components, and even direct foreign investment by firms.”

The second set of muddles is subtler, says Srinivasan. Even some economists who use the appropriate definition of outsourcing sometimes worry about whether arm’s length trade in services should be treated with the same analytical tools as trade in goods, or whether it presents different issues, he notes.

Outsourcing is fundamentally just a trade phenomenon.

K-stages:-The logic for a KMMM (knowledge management maturity model) in the Indian IT industry is strong, say Ganesh Natarajan and Uma Ganesh in ‘Unleashing the Knowledge Force’ ( “In the current scenario where attrition of skilled manpower remains one of the critical concerns of all industry CEOs, the need to have a predictable and step-by-step movement towards knowledge management maturity cannot be over-emphasised,” they reason.

There are four stages in the progress towards knowledge maturity, one learns. The first is the pre-knowledge initiation stage, in which the organisation’s success in getting business is ‘largely due to being first in the market with a great product or idea, with no attempt to establish any processes for knowledge capture or dissemination even among current practitioners’.