Let’s face it – most U.S. businesses who use some form of outsourced professional services are often strongly opposed to “going public” about their activities. The obvious reason is fear of public backlash or appearing “anti-American”.
We oppose this kind of weak-kneed positioning, which in effect denies the reality that globalization is irreversibly altering the sourcing of talent, the operating culture of major corporations and the contributions third-party organizations make in spurring new ideas, driving research and development and redefining cross-border trade and alliances. (In the coming weeks in fact you will read exclusive reporting in Nearshore Americas about some amazingly innovative LatAm-based services provided to big name clients like Google, Electronic Arts and J. Walter Thompson.)
Still, there are other cases where the client is perfectly happy to reveal its associations with outsourcing providers, but the provider is hesitant to make public the partnership for fear that a rival – particularly those that are more “local” to client’s base – will act as a bottom feeder and try to steal the business.
Then, finally there are those cases when both the customer and provider step up and say – enough already – we are proud of our sourcing alliances and we’re not afraid to make the world aware. Such is the case recently when Wipro announced two big clients – U.S. retailer Best Buy Inc. and insurance provider Main Street America Group in the last few weeks. Others getting this kind of ink recently included Infosys sealing a major deal with Microsoft and U.S. publishing firm Advanstar hiring HCL Technologies to handle production and other BPO services.
“They (customers) are communicating that to their own shareholders…that they are taking efforts to restructure their own cost structure,” Suresh Senapaty, chief financial officer at Wipro, was quoted as saying in a recent LiveMint article. “(But) not everybody is doing that; it is still a minority.”
Will we see more Nearshore providers be more out-front about their clients? It will take time and it will depend on the industry as much as anything. Silicon Valley based customers are probably the least fear-prone when it comes to going public.
Providers that have both an on-shore and off-shore strategy are often in a superb position to defend their operating principles. Nearshore Americas’ recent interview with Robbie Brillhart, of Capgemini, is a good example of a provider explaining that good things happen when jobs are provided in emerging markets. Capital flows in. Governments are spurred to leverage the interest in their countries to improve education and build better infrastructure. If things go right, the country rises and life improves for the ordinary citizen.
Despite the society-improving benefits of cross-border sourcing, the large majority of U.S. corporate customers are going to stay mum. The fears are too palpable. The only problem I see is that if CEOs really, truly cared about appearing “anti-American”, then they would stand up and recite every reason for using offshore labor. The explanation would serve as a roadmap on how the U.S. could regain its competitive edge.
Nearshore Americas is the only independent online news brand dedicated to outsourcing in Latin America and the Caribbean.