I’ve In-sourced my Outsourcing

We live in a global economy. Whether you are big business or small business, it is easy to reach out to the other side of the world and get things done for a lower price. But there is a lesson that the big boys learned when they sent work overseas that a few of us smaller players are just beginning to learn. Let me explain. When product manufacturers like General Motors, Niké and Reebok first set up factories in places like Mexico and Asia they were excited that rather than paying $35 an hour they would only have to pay figures like $6 an hour. I can imagine all the accountants and management team declaring “Look at the economics! We will save a fortune.” Then the work started. They found that with US management trying to run foreign factories language was an issue. To communicate with the team took interpreters and that meant lost meanings, missing messages and additional effort. Training was also an issue as the overseas workers took a lot more training hours to get up to speed and be able to do what was required. The economics started to not look as good! There are many stories of big business sending their business overseas and then bringing it back. Even locally, more and more banks are placing their service teams overseas. One that I have had a little to do with is the NAB. They put a lot of their credit card processing overseas but what they did not put overseas is their customer service, the customer-facing side of their business. The part where customers had issues, problems or queries and actually interacted with the bank, the core part of their business they kept in-house. As a small business operator, I also like to keep an eye on my economics. As part of that I had some work transcribed overseas. It was by an internet service, so it was a fixed rate, simple job. If only it were true! I had to spend a lot of time editing the work because their English and my English were significantly different. They were also unfamiliar with business language so I had to do a lot of rework to make it flow properly. So the economics to have it done overseas at a low price actually cost me a lot of time and effort. For a more recent piece of transcription work I chose to in-source it to an Australian service. It cost me significantly more on an hourly rate to get it done and I couldn’t be happier. I had a sample of the work returned to me within six hours and the completed job in less than 24. The additional instructions I had left on the recording throughout the body of the recording were followed accurately and without the need to double check. The most valuable thing for me was the on-the-fly editing. What it meant for me was that the document only needed minor formatting before I sent it to my client. For me, it was money well spent and I was pleased to spend a premium to get the job done right the first time. At the end of the day, the lesson that big business and small business have learnt time and time again is that you get what you pay for. So if you are selling these services, the key thing to focus on is not your rate, your availability, your turn around time of even how pleasant you are - what you need to sell is the value of what you do. The value of time saved not having to rework the job, the time saved on not having to be trained to do it multiple times, the value of getting it right first time! Naturally there are things that can be easily outsourced to others at a far reduced rate, but certain services are best in-sourced. So for your success, work out where you add the most value and focus on it.