Wednesday, December 05, 2007

Outsourcing trends

Source : Click here

Outsourcing exists on a fairly simple premise, If you can do something, there must be someone else out there capable of performing that same task , only cheaper. With VoIP and the Internet, almost anything can be outsourced with some time and consideration. Let us look at five unusual trends in outsourcing, all of which are likely to become the norm. Outsourcing is poised to grow exponentially as more entrepreneurial minds check out the tasks on the worlds todo list and figure out who can best provide those services for the least amount of money.

1. Getting personal. Outsourcing usually brings to mind business tasks, whether that means customerservice calls offshored to India or dataentry work farmed out to a virtual assistant. But why leave it at that. Why not outsource the design of your personal Web site, the building of your deck or reservations for your vacation. is a stateside service that allows people to put their tasks up for bid , anything from raking leaves to installing software. Right now, this idea is really in its infancy, says David Davin, COO and cofounder of DoMyStuff. But this is where the Internet has been heading all along. We all have specialized skills. The Internet brings us to one place where we can exchange those skills.

The ptop offshoring industry is just beginning, but research firm Evalueserve predicts that by 2015, consumer and smallbusiness offshored services will grow to more than USD2 billion, from only USD250 million in 2006.

2. Outsourcing the outsourcing. With success comes competition. While India is synonymous with outsourcing, its also facing competition from other nations looking for a piece of the pie.

Indias economy is in an upswing, and wages are rising quickly. According to a report by Gartner, Indian software engineers will be earning 40 percent to 50 percent of Silicon Valley wages next year, and the difference will continue to diminish, as will the savings American companies get from outsourcing.

At the same time, other countries are looking to India as a model of economic growth. A recent trade event in New York City, OutsourceWorld, boasted representatives from nations as diverse as Mauritius, Costa Rica, Canada, Malaysia, Romania, Malta and the Ukraine.

Indian outsourcing firms are preemptively opening offices all over the world to compete. Infosys, a USD3.1 billion leading provider of outsourced services, has 75,000 employees in India, but also has offices in several countries, including Mexico, the Czech Republic, Thailand, China, Poland and the Philippines.

Its quite likely that the next time you outsource a task to India, the person actually completing that work may live in another country , and youll probably never realize it.

3. Tutoring a world away. Tutoring can be expensive, but parents will pay to help get their kids into the best college , a goal thats fueling the USD4.5 billion tutoring industry at a 12 percent to 15 percent growth rate, according to Eduventures, an education research firm. But not all parents can afford the hourly rates at centers like Sylvan. So theyre turning to services like TutorVista, an online tutoring service based in Bangalore, India.

Founded by Krishnan Ganesh, the service offers a USD99 per month flat rate for tutoring; kids communicate with their Indian tutors via voice chat, IM and a digital tablet.

Ganesh has received USD15 million in venture funding and hired U.S. tutoring industry vet John Stuppy , Sylvan, The Princeton Review and Educational Testing Service , as his companys president. As of September, TutorVista had attracted 10,000 subscribers in the U.S. alone and was planning on doubling its staff of 600 tutors.

4. Automating the drivethru. When you place your burger order at a drivethru speaker, you expect that the person taking your order will also be taking your money at the window in about 30 seconds. Not so with Exit 41s solution.

To speed things up, the company has callcenter employees take orders using VoIP; the orders are then sent realtime to a monitor in the kitchen so that in the few seconds it takes you to reach the window, your steaming food is awaiting your arrival.

In Lexington, Kentucky, a Wendys master franchisee has installed the system in 16 stores and acts as a call center for other Wendys franchises on the East Coast. One highvolume store has shaved off five seconds from order time and doubled its capacity by adding a second drivethru lane.

Joe Gagnon, CEO of the Andover, Massachusettsbased firm, says he believes Exit 41s solution will become more common. Not only does it help increase drive thru capacity, but it also allows for the use of operators in lessexpensive areas , for example, a state with a lower minimum wage or even Mexico.

5. Power from the people. Crowdsourcing takes a task and unleashes it to the world. Think Wikipedia, the bypopularvote Tshirt designs on, or Amazons Mechanical Turk service, in which people take on fairly simple chores, such as summarizing a paragraph of text, for pennies a task. Google cleverly crowdsourced image tagging by turning it into a game, bypassing the need to pay for the task.