Outsourcing Collaboration Vs Offshoring

!±8± Outsourcing Collaboration Vs Offshoring

It is unfortunate that the term outsourcing is used for services within and outside the United States. There is a world of difference between them.

Outsourcing in the United States generates jobs and revenue for many local economies while providing direct oversight and communication between the outsourcing company and the company performing the work. This is why outsourcing in the US is also called Outsourcing Collaboration.

Contrast this to outsourcing overseas or offshoring.

"Seven years ago, MIT instructor and design for manufacture engineering expert David Meeker co-authored a report which concluded that manufacturers were overlooking many of the costs associated with outsourcing production to low-labor countries such as China." In a new, updated report Meeker states, "Aside from unexpected events, hidden costs exist because complete costs are rarely allocated to the product and reside instead in corporate overhead budgets," this latest report states. "This distorts fair comparison of domestic and offshore manufacturing, leaving labor rates as a common, central metric."

When we compare the costs between outsourcing collaboration and offshoring, we rarely measure it as apples to apples as there is much additional overhead that is required for offshoring. If costs were examined on a level playing field, much of the work that is outsourced overseas could be performed in this country. Furthermore, the communication and language barriers that present formidable hurdles for offshoring - which can result in project failure and significant overhead - are minor bumps if they exist at all, in outsourced collaboration projects in the United States.

Outsourcing in the United States helps produce meaningful jobs. The Mid-Hudson Workshop for the Disabled, for example, has been hiring disabled veterans and others with physical & medical handicaps for over 60 years.

"Since the early 1990s, many new customers have been attracted to the workshop by the quality of the work, dedication of the employees, and the cost savings. While IBM helped launch us in 1948 and continues providing substantial work, some of the newer clients include TARGET Stores, Naked Earth Distributors, J.L. Taylor Manufacturing, Pawling Corp., Laerdal Medical Corp., MPI Wax Injection Molding, Stamford Scientific International, St. Francis Hospital and the Poughkeepsie Chamber of Commerce."

The concept of outsourcing collaboration is very positive. It denotes the importance of developing and maintaining a strong relationship between the contracting company and the outsourced company that is doing the work. This two-way communications is very significant since it can affect the outcome of current and future outsourced work. It also allows a company to quickly assess the quality of the finished products and easily receive accurate production status and feedback information.

Collaboration is an important term that business consultants frequently use. It usually involves two parties working together to successfully complete a job. Outsourcing in the US is certainly a collaborative effort; one that is beneficial to all parties, can be perpetuating and most importantly, results in some well done work at a reasonable cost by a local workforce.