The global business services industry is changing - and that means companies need to make the right choice when faced with onshore, offshore and nearshore options.
As part of the Scottish delegation at the International Association of Outsourcing Professionals (IAOP) World Summit, the University of Strathclyde's Professor Phil Taylor explored the changing landscape of global service delivery.
Offshoring now forms a core element for companies looking to reduce costs or restructure their businesses.
This approach has led to growing BPO sectors in countries like India and the Philippines.
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Scotland's business services industry (PDF)
Increasingly, however, companies are discovering that the cost benefits delivered by these emerging markets is offset by other factors like reduced productivity.
Choosing the right location
Professor Taylor argues that location decisions are highly nuanced, with cost only one of a number of considerations including:
- Skills availability
- Labour pool depth
- Accommodation costs
- Political stability
- Financial assistance
- Attrition levels
These factors help explain why Scotland's BPO industry has grown steadily despite the economic turbulence of recent years:
- The industry in Scotland employs 90,000 people - up from 46,000 in 2000
- 38 of Scotland's contact centres are owned by companies with headquarters abroad
- 55 of Scotland's contact centres offer dedicated foreign language support
- Our workforce delivers high quality skills at a lower cost than many rival locations
- Costs in Scotland are 30% lower than the south-east of England
- Our workforce offers technical ability, knowledge, emotional intelligence and linguistic sensibility
Professor Taylor states that companies should pursue a "right shoring" or "best shoring" strategy, blending key factors rather than concentrating on the perceived short-term cost-cutting advantages of sending work overseas.
And the strengths of our BPO industry help Scotland to score highly when companies consider this "efficiency or excellence arbitrage" when making location decisions.
By investing in Scotland you'll enjoy all the benefits of our established, successful BPO sector - and our staff will be on hand to support you every step of the way:
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