Outsourcing providers that have seen their fortunes rocket as companies worldwide have looked to offshore providers to achieve the rapid business transformation that they themselves failed to achieve for years via process redesign, enterprise resource planning (ERP) implementations and shared service initiatives.
For many outsourcing customers, meanwhile, the term “labour arbitrage” has become common parlance as they have sought to locate business functions with providers working in geographies where wages are lower. According to The Hackett Group Managing Director Joel Roques, the potential for companies to reduce costs by offshoring back office operations is dramatic, particularly when business processes are reengineered for improvement before they are taken offshore.
