The Outsourcing Return

Filed in archive Outsourcing Issues on October 22, 2007

This is not what you think it is. Based on recent news reports, outsourcing is now coming back to its origin: America.

This was indicated in this research entitled "Time Zones Do Matter: Rediscovering the Americas and Nearshore Delivery" by Dana Stiffler the research director for AMR Research. According to the report, most companies are pulling out their outsourcing deals and are returning home because of their unsuccessful try of outsourcing as a business strategy.

The reason for this was referred to as the "India and China fatigue". This was described as:

"Businesses which are seeking relief from the staff attrition and rising salaries that have become the norm in Asia and looking to Latin America and less expensive regions of the U.S. as an increasingly attractive option for IT services delivery."

Personally, I see that the number of deals which are returning should not be a cause of alarm because I think these outsourcing deals lacked preparedness when dealing with this outsourcing business.