Outsourcing boom is over
By: Kundan Mishra

According to the new study from consulting firm Diamond Cluster International in Chicago, outsourcing boom has become the pages of history and maturity is setting in.

The leveling off is due to experienced customers which have become more shrewd and more fussy about their work which they handed over to the outsourcing providers. Their reluctance is due to the disappointment with the performance of their outsourcing providers. Now premature contract terminations, particularly with onshore providers, continue to be a prevalent trend.

By outsourcing a business process, we tend to loose the managerial control. Another disadvantage is that, if your company is outsourcing business process such as payroll, confidential information such as salary will be known to the outsourcing service provider, which can prove to be a threat to the security and confidentiality of issues of a company.

There is building of hostility between onshore versus offshore. We see more people staying away from onshore deals in order to put things offshore. The study found that 47 percent of buyers had prematurely terminated outsourcing relationship in the prior 12 months. Moreover, customers also pop up question whether they are receiving value from onshore providers to be on the safer side. Comparatively, offshore providers are seen as more attractive because they can increasingly boast certifications, such as CMMI, to go with their significantly lower costs.

Discounting honesty is leading to an overall decrease in outsourcing spending. Thus before a company decides to outsource its business process, it will examine all the factors carefully. It should not happen that outsourcing become a reason for a company to regret later.

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