Well, not really. But you can now run call centers at parity in the UK when compared to the costs associated with running a third party call center in India. As per this recent article over in Global Services on how a UK company reverts outsourced work from costly India, New Call Telecom is opening a new call center in Burnley, England (a borough of Lancashire) because operational costs are on par with what they’d pay in Mumbai and New Delhi. Furthermore, since the average handling time of a call in the UK is 25% less, they will cut headcount costs as well. And the headcount they do hire will be “sticky”, unlike the Indian employees who leave for lunch and don’t come back when the call center across the street makes them a better offer.
So, now that it’s cheaper to open new call centers in the US and the UK, and now that Indian companies are hiring American citizens on American soil to fulfill the outsourcing contracts granted to them by American companies, is there really any reason to go to India? Maybe. But it is still getting more expensive by the day and will never offer home-soil advantages, especially in services.
Now, there is the problem that, because many companies outsourced all of their services, they no longer know how to even run a call center, but there is a solution for that. Insource some Indian experts to do it for you. And if you insource to Arkansas and set up some cameras, you can have the next great reality series. While NBC airs Outsourced, about ex-pat Americans shipped off to India to run call centers, FX will be airing Insourced about the life of an Indian call-center manager, who never left the country, who is shipped off to live with some hillbillies in the Ozarks.
A recent article over on the CPO Agenda on Fresh Thinking, which noted that Procurement must be bolder in bringing about wholesale change that delivers effective results for the business, highlighted a number of areas that could be ripe for change. These areas need to be looked at carefully because their current state could actually be holding the Supply Management organization back. In order to advance, Supply Management cannot accept the status quo when the status quo is an outdated, ineffective, and or costly way of running the business.
The following five areas are ripe starting grounds for a Supply Management organization that wants to take its operations to the next level.
- Organizational Rules
Are organizational rules limiting opportunities for efficiency and effectiveness? There are a number of ways organizational rules could be impacting the Supply Management organization, including, but not limited to:
- Diversity/Buy American Mandates
While it’s often a good idea to diversify spend and buy at least some products or services at home (to address offshoring risks), excessive diversity or buy american mandates can severely limit options and have a dramatic impact on efficiency and effectiveness.
- Payment Terms
If finance is imposing egregious payment times on suppliers (of 90 days or more), this will limit the supply base that is available to the organization as some suppliers won’t stand for such BS.
- Approval Chains
If Procurement has to get a sign-off from each affected organization before every buy, and executives for buys over a certain dollar limit, they will be spending more time trying to get signatures than doing their job. Sign-offs should only be required for critical buys or very high dollar buys, not for office supplies or temp services.
The specifications could be outdated, non-standardized, or overly specific and all of these can add cost and drain efficiency.
- Overly Specific
If the specifications call for specific components from specific suppliers that are essentially commodities, they are overly specific and limiting competitiveness.
If each department has their own specification for a workstation with a different configuration, this can limit leverage — especially since it’s very easy to standardize on an office workstation configuration for business people and one for technical people.
If the specs are calling for components that are now only being manufactured by a 10th of the total supply base or using materials that are no longer in common use, then the specs are outdated and should be refreshed.
The marketplace could be holding Procurement back by holding on to outdated products or insisting on a wide-diversity of products when only a few should be required. For example, customers may love the old, regular un-concentrated laundry detergent which costs more to package and transport and is less environmentally friendly than the new concentrated formula or may be split between six scented varieties of your dish detergent. In the first scenario, Procurement will need to work with Marketing to push the new, environmentally-friendly, product while phasing out the old product and in the second, Procurement may have to work with engineering to find a way to mass produce the base detergent and mix the scent in later to avoid six low-volume, high-cost production runs.
If the rest of the organization thinks of Procurement as the back-room, paper-pushing organization where careers go just before they are put out to pasture, it is going to be challenging for Procurement to gain respect, exert influence, and get a majority of spend under management. Procurement will have to work on its image first, get some quick successes, and leave major organizational change to later.
- The Ideal Solution
If the concept for the “ideal solution” is outdated, then Procurement’s efforts will be outdated. Before effecting significant change, Procurement has to know what the optimal state is and why.