Business Process Outsourcing Caught in the Crossfire of Globalization
Anu George, Chief Quality Officer at Morningstar, a global provider of investment research data, talks about the changing nature of business in a globalized world. George says that while business process outsourcing has expanded around the globe, she questions how long the cost imperative that drove outsourcing will persist. "The reason organizations did outsourcing was drive by the cost arbitrage," she says. But, she adds, with rising inflation in emerging markets and suppressed economic growth in developed economies the "cost arbitrage is narrowing." Equally, in emerging markets, she adds, good talent is getting harder to find while in developed countries – hit hard by the recent recession – there’s a relative glut of good people on the market. As a result, companies are starting to take a hard look at whether and where it makes sense to outsource.