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Global sourcing: the beauty of choice

by - ThoughtFocus | June 25, 2020 |

Every day we hear a lot about “the paradox of choice” – too many choices can be paralyzing.  Too many choices of orange juice on the grocery shelf makes consumers just walk away, or grab any one of them, essentially making no choice at all.


But for leaders plotting their talent strategies, variety is a bountiful playing field.  In the early days of global sourcing, they had one choice – keep it internal, or offshore it.  Frozen orange concentrate or none at all.


Today, companies have a full range of options, all of them with variations and nuances serving different purposes, depending on the client’s needs and resources:

  • Conventional offshoring services are still the right choice for many situations: handing off commodity-type activities to lower-cost labour
  • For companies with sufficient scale, capital, and the desire for control, there is the captive route; build your own and keep all the benefits
  • Increasingly, mid-sized companies are getting in on the benefits of the captive by working with vendors to finesse a hybrid version – lower cost without loss of control
  • Jobs that appear to be singular and contained can be broken into distinct processes for discreet outsourcing
  • Gaining momentum is revenue process outsourcing: when top salespeople have to spend 70% of their time on a non-sales activity, it is time to think about shifting those activities to offshore resources
  • Work requiring deep expertise in a specialized area with a clear horizon is also a prime candidate: EMV conversion experts have been in high demand, but when the job is over, it’s over


A more frequent option to meet internal, client, or market demands: Companies are recalibrating their choices when circumstances inevitably change

  • The hybrid captive is designed so that when or if the client reaches a point where it is ready to take over the center, the transfer takes place easily and quickly
  • Many companies prefer keeping their arrangements fluid: shifting work offshore when volumes are high, taking it back onshore when it levels out, and building these contingencies into their contracts
  • Increasingly, companies with a large offshore presence are finding it valuable to establish domestic centers – either “rural sourcing” with educated but unemployed personnel, or “inner city sourcing” as a way to invest in their own communities by creating jobs for the hard-to-employ