Outsourcing Misconceptions

May 10. 2004

Much of the discussion revolving around the outsourcing of jobs from America to foreign nations has focused on the jobs and income lost.  This issue becomes much more interesting when it is examined from a larger perspective.

Short-term solutions have been proposed that would essentially place tariffs on such 'imports'.  This is problematic when considering that over 90% of global outsourcing dollars flow into the USA, so retaliatory tariffs would hurt us far worse than the current situation is.

Fundamentally, traditional outsourcing has enough flaws that it will not snowball into the dominant way of doing business.  Indeed, some companies have already discovered that the cost savings they expected have failed to appear and have quietly shifted jobs back.

As Tom Yager of InfoWorld says, "A worker in a temporary role has little incentive to innovate, invent, or create… Contrary to the popular model, truly effective development, management, and administration requires imagination and a willingness to take risks.  If you want to solve the outsourcing problem, employers and workers must meet halfway to dismantle this insane notion of interchangeable parts and an emotionless approach to work."

The bottom line: people aren't just parts in a great machine.  Loyal and committed personnel will always be more cost-effective in the long-term.