Offshore Outsourcing: Business Models, ROI and Best Practices

Offshore Outsourcing: Business Models, ROI, and Best Practices is a comprehensive guide to the real-world application of offshore outsourcing across all industries. Authors Marcia Robinson and Dr. Ravi Kalakota give you an in-depth analysis of offshore outsourcing. They discuss what is behind this trend, how it is paying off, and, most importantly, provide you with a step-by-step guide on how you can implement your own offshore strategy.

Based on extensive research and interviews, this book offers insight into how managers of leading firms are implementing offshore outsourcing. You will find plenty of practical tips and tools to apply offshore outsourcing in a wide variety of business environments.

Offshore Outsourcing is organized in three easy-to-read sections:

Part One introduces the value proposition of offshore outsourcing, including fundamental concepts, the different business models, and the business process landscape.

Part Two examines the specifics of the processes being offshored today, namely information technology, customer care, finance and accounting, human resources, and transaction processing.

Part Three describes the major activities of the offshore strategy, vendor sourcing, and country selection.

Robinson and Kalakota include multiple best-practice case studies to illustrate how firms are executing their offshore strategies. The authors map out key steps to help you make the right choices with your own offshore projects and reveal the benefits, costs, and risks of offshore outsourcing. Finally, it’s your choice. Offshore outsourcing can be a haphazard affair that creates anxiety among employees and fails to deliver bottom-line results. Or, with this book at your side, it can help you create a more focused, streamlined, and competitive organization.

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All Customer Reviews
Average Customer Review:
7 of 7 people found the following review helpful:

If you have never outsourced offshore, Part II, Offshore Outsourcing best practicies, other parts are light, 2006-04-17
If you are not familiar with offshore outsourcing at all, then Offshore Outsourcing by Marcia Robinson and Ravi Kalakota provides a very detailed view of both business models that can be used for working offshore and reviewing what could possibly offshored, including many areas not normally described (for example: telemarketing for initial sales leads.).

Starting off in Chapter 2, various business models are defined. While none of the models is new, it is a good compilation. It also shows that you can take pieces from the various models and form your own. A staff augmentation onsite model is not listed, but it could be considered similar to the BOT (Build Operate and Transfer) model defined in the book. A staff augmentation model means that you do not necessarily have to transfer operations to the client from the outsourcing firm. It may never make sense for the client to take over the operations themselves. Chapter 2 also reviews different revenue models at the end of the chapter. It would have been good to see how the business models cross with the revenue models; which revenue models work best with what business model, etc.

The bulk of the discussion in this book defines the various types of activities that can be undertaken offshore. At a high-level, five areas are defined

1. IT
2. Customer Care
3. Finance and accounting
4. human resources
5. transaction processing

A chapter is dedicated to each of the five areas. I think for some people, some of the types of activities that are discussed will be surprising. For example all of the activities listed under marketing: direct mail marketing, campaigns, telemarketing, telesales, lead qualification, lead tracking and customer surveys. Many marketing consulting firms will tell you many of these areas can't be done offshore, but clearly they are.

Good for review is that no matter what you outsource, each item needs to be evaluated. When evaluating whether or not to offshore any of these processes, need to answer these questions:
1. Can you offshore without losing your competitive advantage?
2. If you offshore it, can you receive incremental savings from it?
3. Can you offshore it without losing control of it?

One item is given as an example for back-office transaction processing starting on page 70. They give an example of Dispute resolution which is done at the FCE (Financial Center East) of American Express established in India in 1994. Now dispute resolution is very labor intensive, which is true, and it requires customer interaction. They refer to it as an area where FCE shines because of low-cost, high quality staff. They state that the FCE has reduced the turn around time in the dispute resolution process, but they do not say why? Are they doing things such as: Part of the work is done during the day in the US or Europe, then other items are done overnight in India, or have they thought up new ways on their own (were they given that autonomy) to change the dispute resolution process? Since 58% (stated on pg 69) of what they do process is for Japan and Asia Pacific, is there something specific about the laws for dispute resolution in those areas that they can be resolved faster. It would be good to see the average times for dispute resolution within the US center, the UK center and the FCE. But then we would also need to know, is the process exactly the same, can it be the same because of the laws, and therefore are we comparing apples to apples or apples to oranges. I would have liked them to delve in to one or two of these scenarios much more closely. Right now we only get a top view of everything that has taken place, what people have offshored, how it has worked, but little details on why it failed, or why it worked, which would be necessary to determine best practices and to not get a false sense that everything will be okay going offshore. This would be necessary data for AmEx to determine are they really getting an advantage with the FCE, or are there outside factors which influence the results.

During the discussion on IT Outsourcing, there was one thing I always have to laugh about. Companies always talk about how they undertook a large vendor selection process, and then chose Wipro, Infosys, Tata, Satym, etc., and usually more than one. I have to wonder why they bother with the selection process, why they waste the money? They chose the top Indian outsourcing firms; they could have saved time and money and put those companies on their initial short list. Do they really get any benefit by going through the entire selection process that make up for the time and money that it takes?

The third section of the book is dedicated to helping a company define their offshore strategy. Initially the book implies that you have to start out knowing exactly what you want to offshore, but then they do go deeper in to it. Step 1 includes: Analyze your goals and set your strategy looks at how to determine what to offshore and what to keep in-house. The author's do make a blanket statement that if you are in the pharmaceutical business you shouldn't offshore your R&D, however, there are successful cases of pharma companies offshoring just this type of work and making specific deals to do this.

The vendor selection and location selection chapters are fairly standard. The vendor selection process is one that is used for selecting any type of outsourcing firm. It does include a section on the best Indian outsourcing firms. The location selection chapter reviews common criteria for evaluating different countries and parts of the world.

Offshoring Outsourcing is a great book for those not familiar with all of the different types of work that can be offshored. The best part of the book is Part II which is called Offshore Outsourcing Best Practices, but really describes in detail, based on the five high-level outsourcing categories, what can be offshored. For many of the items, examples of actual projects and situations are included. If someone is not familiar with the different areas that can be done offshored, this is the book for them. The sections on setting your offshore strategy and how do you actually get started are lighter. They will be a help to a company which has not started, but other reference sources will still be needed.





3 of 4 people found the following review helpful:

Know how about outsourcing!, 2005-10-13
Found cheapest copy here. Good buy as always. Gives you a basic round down of outsourcing.


5 of 5 people found the following review helpful:

I actually read this book :-), 2005-10-13
After reading some of the caustic comments posted regarding this book, I thought it might be useful for people to hear a different viewpoint.

I read this book after borrowing it from a co-worker to get an overview of offshore outsourcing. After attending a lot of internal meetings where managers throw out various buzzwords like BPO, ITO, near-shoring, offshoring etc. I needed a primer that had a lot of examples and case studies.

I found the book useful in terms of providing a basic foundation in terms of what was going on. Was the book perfect, no. Was the book upto date in 2005, no. Did it provide a basic education and overview, yes. Did it provide some guidelines if you were to implement outsourcing, yes.


2 of 5 people found the following review helpful:

Propaganda, 2005-10-11
This Book is a Propaganda for projecting outsourcing the best option for big businesses and India is the best place for this business.


0 of 2 people found the following review helpful:

Better Information out there...Recommend You Look at Other Outsourcing Titles, 2005-10-02
At best, this is a compilation and one-off set of the business journal articles of two & three YEARS ago.

Perhaps in 2003 it was the book to get - but now there are too many other great outsourcing books to choose from.

Like other critical buyers have said, "Not worth the cover price". You'll be disappointed you didn't expand your search for more complete and current outsourcing selections.

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