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A Guide For Small & Midsized Enterprises
One can’t peruse the business press without encountering another paean to the wonders of globalization—epitomized by the best-seller from its most famous acolyte, Thomas Friedman, describing today’s “flat world.” The resulting inescapable global competition has led to a conventional wisdom that any business activity that can be moved offshore will be moved offshore. This cutthroat zeitgeist often compels small and medium-sized enterprises to jump into an outsourcing decision without fully considering the consequences.
Let’s first make the distinction between outsourcing and offshoring, because they are often used interchangeably. Outsourcing refers to the practice of taking certain internal company business processes or functions and contracting them out to a third party. Outsourcing focuses on the identification of specific business activities—the what—regardless of where and by whom they are performed. Offshoring simply is the relocation of a business activity to an overseas location.
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