Outsourcing for the right reason: interesting conversation with a small business owner. Not that his business has any apparent connection with outsourcing, globalization, or localization but... he has very interesting ideas.
The conversation started with topics like Chinese imports, drop of general consumer goods prices, etc... And then came BP on the radio in the background of the cafeteria. My interlocutor started to talk about BP and outsourcing. More specifically he mentioned "BP's disaster is due, not because of outsourcing, but because they outsourced to save the wrong bucks: for me this is the reason of the overall worldwide crisis".
Not that I completely agree, I earn my living thanks to outsourcing after all. But there are interesting logics to follow in this statement.
The reason why companies decide to outsource could sometimes not exactly be the right reason. Often, outsourcing comes from a need or willingness to save money but forgetting many other factors: "let's change the production chain from here to there, or from internal to external, or from this vendor to the other...only because it is cheaper this way".
Not because we can then concentrate on our core tasks, not because we will try to do things better in this particular area...not because we need to focus here instead of there...simply because it is cheaper.
And companies fail when they do this.
If quality is dropped: they fail. If costumers receive worse service: they fail. If the security of assets is jeopardized, they fail. And unfortunately this happens a lot.
The service business is to keep adding more and more value to your costumers. Each day, each week, each month, each year. Contract after contract if you prefer. This is what the service business is about.
Outsourcing needs to be considered as an investment to grow, to allow you to be better at what you do. All with a clear goal: aim to be the only possible option for your clients.
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