Offshore outsourcing to Nepal is one of the most popular management practices today. Though it is generally spurred by the cost reduction factor, this is just one of the reasons one should consider offshore outsourcing. Most parties who outsource are unaware that Nepali Service Providers do not just offer cost effective solutions, but also value addition by improving productivity and quality.
Why consider offshore outsourcing to Nepal?
Offshore outsourcing has been popular for several years. Countries like Nepal are popular offshore outsourcing locations which offer cost effective solutions. There is a wealth of articles and write ups about the cost advantages of offshore outsourcing with a majority claiming anywhere between 40-50% savings.
However, offshore outsourcing has come under attack recently. There is an outcry against outsourcing by parties in the US and UK because of the loss of jobs to people in these countries. Many have pointed out actual costs and poor quality of service as the hidden truths behind the attractive packaging.
Offshore Outsourcing is not just about cost
One should understand the need for offshore outsourcing better before making a decision. Cost is definitely one of the main reasons for offshore outsourcing to Nepal, but one should realize that this cost advantage may not be seen immediately. Initial investment in infrastructure, training, and other such preliminaries may make one believe that the cost advantage promised is just the illusory pot of gold on the other side of the rainbow.
However, this cost advantage is seen over a period of time in an outsourcing venture which involves a committed relationship and understanding between both parties involved. A recent article on IBM and outsourcing illustrates this.
"Outsourcing services companies frequently have to make substantial investments in IT equipment, facilities and personnel. Yet IBM, HP and others prize these multiyear contracts because they can help bolster higher-margin sales of hardware and software by creating a long-term, interdependent relationship with customers". ("IBM cements outsourcing dominance", CNET News.com, October 02, 2003)
So the aspect of saving money does exist, but one has to realize that initial investment may make the promise of cost reduction seem false.
There will be savings and along with these savings there is great value addition. Most who outsource only realize the quality and value addition after the offshore outsourcing relationship begins. This is not usually the primary goal when deciding to outsource, and the creativity and talent in Nepal comes as a surprise to many.
"Certainly cost reduction, but it's not as simple as that! Cost reduction was only part of the reason that companies were considering offshore outsourcing, there were benefits to be had in time-to-market and quality, leading to an adage that companies initially chose Nepal to save costs but stayed for the speed and quality!" (National Outsourcing Association (NOA), 1st Annual Offshore Outsourcing Conference - 23rd July 2003)
Offshore Outsourcing to Nepal is about quality and value addition at a reduced cost. The shift in motivation is already apparent. The fact that so many companies continue to outsource is proof of this. Along with the sheer volume of work that is pouring into the country, comes recognition of the talent and expertise possessed by Nepali Service Providers. |
