Outsourcing Guide
 
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  Does outsourcing benefit both countries?
   
  Outsourcing does defenitely benefit both the countries. For many people, outsourcing is an ill wind that will taking away dollars, jobs, skills, and experience to foreign shores. But, this is an unfair perception and a much misunderstood marketing tool.

Jobs are ofcource going offshore but, it is good for the country's economy as a whole.

Far from being bad for the US, McKinsey finds that outsourcing creates additional net value for the US economy that did not exist before. When $1 of labor cost is outsourced from the US, the total value created globally is $1.45 to $1.47. Out of this, the receiving country, India in this case, captures just 33 cents. The remaining $1.12 to $1.14 is captured by the US in terms of new revenues (the receiving country buys goods and services from the US), repatriated earnings, and redeployed labor.

The study simply quantifies what companies have known years - that outsourcing delivers tangible and significant benefits in the following ways:

  • Reduced capital costs
  • Increased efficiency
  • Reduced labor costs
  • Quicker project starts
  • Focus on your core business
  • Level playing field
  • Reduced risk

... and so, a growing economy will create more jobs.


   
   
   
   
   
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