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The Black Book of Outsourcing

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The Black Book of Outsourcing

How to Manage the Changes, Challenges, and Opportunities

Wiley,

15 min read
10 take-aways
Audio & text

What's inside?

"Outsourcing" is not a dirty word. To increase profits, get others to do work that is not core to your business.

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Editorial Rating

7

Qualities

  • Applicable

Recommendation

Authors Douglas Brown and Scott Wilson offer a good, elementary introduction to outsourcing. They present a comprehensive survey of how to decide whether to outsource and how to select an outsource vendor, deal with contract negotiations and prepare for the reality behind the hype of outsourcing. Many business readers may be surprised to learn that, notwithstanding the great difference in pay between Indian and American engineers (for example), first-year savings on outsourcing contracts may be as little as 15%, and company productivity may fall by this amount or more because of the time you must invest in knowledge-transfer and training. The book includes a lengthy directory of firms involved in outsourcing services and provides several chapters to guide employees who are facing the possibility of having their jobs outsourced. getAbstract.com recommends this book to managers whose companies are considering outsourcing and to those who hope for careers in the burgeoning outsourcing industry.

Summary

Myths and Facts

In the past decade, outsourcing business processes has become a common and contentious business practice. Outsourcing is different from "offshoring," the proper term for moving functions and processes overseas, which drew criticism when American unemployment did not improve after the recession of 2001. The debate over outsourcing revolves around three myths:

  • Myth 1 - Outsourcing means that workers in other countries take jobs away from American workers. In fact, outsourcing is a matter of hiring outside firms to do jobs that companies used to handle in house. For reasons of economic efficiency and quality, it may make sense to have specialized experts perform functions and processes that are not critical to your firm nor the best use of its scarce human and financial capital.
  • Myth 2 - Only large companies can benefit from outsourcing. In fact, although big companies pioneered outsourcing, some small companies have discovered that they must outsource to maintain their competitive advantage.
  • Myth 3 - Outsourcing hurts America. In fact, surveys by the Information Technology Association of America concluded that outsourcing benefits...

About the Authors

Douglas Brown and Scott Wilson co-founded the Outsourcing Management Institute.

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