Home > People > Outsourcing — The Hidden Story

It’s easy to see why so many businesses are sending work to countries outside of the U.S. Maybe you’ve thought of doing so yourself. After all, overseas subcontractors can work for half, or less, of the rate of most U.S. subcontractors. And if your competition is already outsourcing, then it might be hard to beat their prices.

The hidden outsourcing “circle”

As CEO of a publishing services business, I’ve often been contacted by “packagers” (companies who handle all aspects of publishing books except printing and marketing) who want us to proofread or index books that they have been contracted to work on from major U.S. publishing houses. Yes, it’s a strange arrangement.

I mean, think about it — if U.S. subcontractors are being contracted by overseas companies who have been contracted by U.S. companies, what really is going on here? It basically means that such overseas companies don’t really have workers with the skills needed to do the work. All that they are doing is promising low rates for large volume contracts and then seeking out U.S. small businesses who are willing to accept work at a much lower rate. U.S. subcontractors may often do this because there is so much less work around now that it has been assigned to these same overseas companies.

Hidden consequences of outsourcing

Many overseas companies are not comprised of people who have years of experience and skills in the field in which they’ve set up business. They often lack a deep understanding of specific issues related to your area of business.

So what are some of the hidden consequences of outsourcing? Here are just a few that I’ve encountered in six years of doing work for overseas companies:

* Pushing work out in ridiculous time frames. For example, I had an overseas subcontractor ask me to write an index for a book over the weekend. This is a job that normally takes several weeks, and they wished to have it done in several days, and on Saturday and Sunday, at that. Naturally, I wouldn’t do it. But if they are getting some freelancers to do that type of work, you can imagine the effect that it has on quality.

* Sneakiness, boarding on dishonesty. On many occasions the price that an overseas company agreed upon in an email changed in a later email after the project had already begun. I had to insist repeatedly to get the rate originally offered. In at least once instance, my words fell on deaf ears. Recently an overseas business asked us to only write a subject index, later to add on a name index and yet they expected to pay nothing extra for the added work.

* Time difference difficulties. A while back I received a phone call at 2:30 a.m. from a foreign contractor. I let them know what time it was in the U.S. She replied that she realized this, but needed to talk about the project at that time since those were the hours that she was at work.

Granted, your business might be very different from mine, and perhaps those to whom you would be outsourcing are not subcontracting back to U.S. small businesses. But whether they are treating U.S. subcontractors this way or being unreasonable with their own employees (far more likely), you can understand the effect it would have on the quality of the work that they are doing for you.

You might think, “well it’s much cheaper, and it’s good enough.” But if cheaper and good enough are all you care about, you’re putting yourself at the bottom of the barrel. Is that where you want to be scraped from? It’s true, being cheaper is one way to compete, but the other is being better. Better at creating remarkable, superior work that makes your products or services stand out from the others.

You’re not going to get that by outsourcing.

Photo Credit: comprock