Business outsourcing

Business process outsourcing (BPO), knowledge process outsourcing (KPO) and medical transcription services (MTN) these are only a few components that make up a multi-million dollar industry of outsourcing, at least, in India. These are not only lucrative opportunities for foreign multi-national corporations but also for the host country in the form of foreign direct investment (FDI) and for providing jobs.
Business outsourcing is a perfect example of a win-win situation, where in both countries involved stand to gain in the deal. A multi-national sets up its off-shore operations in another country, which is invariably a developing country. This is because the resource base is larger and available at a cheaper rate than in the home country. The home country gains with the increase in investment and job opportunities.
These being on the positive side, now, let us look at some of the negative effects of outsourcing. When a multi-national sets up operations it needs to take into account hindrances that it might face in terms of cultural differences, legal considerations and hiring problems among many others. There is also the problem of outlay of a huge investment which is associated with certain business risks. The host country also faces problems because of the unorthodox work timings with office hours beginning at six in the evening and going on until dawn. Also, the difference in work styles poses as a cultural problem due to emotions attached with the employees. As the saying goes, ‘one man’s food is another man’s poison’ so is the case with business outsourcing.