Mercer

Offshoring Opportunities: Strategies and Tactics for Global Competitiveness

Last updated: 11 May 2004
Written by: John Berry,

 

 

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Offshoring – A Reality Check

In today’s competitive, global business environment, offshoring is a significant trend that is changing the competitive landscape of American businesses. Often providing significant economic advantages, offshoring presents a compelling value proposition for many companies. Yet many organizations fail to plan for offshoring properly or execute effectively and value is often destroyed, not created. Offshoring Opportunities: Strategies and Tactics for Global Competitiveness helps executives, managers, and consultants knowledgeably and objectively examine the offshoring option, with the ultimate goal of maximizing offshoring value while minimizing offshoring risks.

Faced with increasing global competition, few companies can afford to ignore the offshoring trend.  Though controversial, offshoring is an economic reality in today’s global business environment. This book objectively addresses the tactics, and strategies involved for organizations who seek to consider breadth of complex issues that swarm around offshoring decisions.


Offshoring Opportunities provides a framework for thought and discussion

  • An examination of all the factors an organization will confront as it embarks on an offshoring initiative

 

  • Exploration of common business drivers that spur companies to consider offshoring, including cost cutting, time-to-market, and capitalizing on capabilities not found in house and how these varying motivations can influence how the offshoring relationship is constructed.

 

  • Perhaps most importantly, a structured, easy-to-understand process-driven framework for the critical decisions facing the offshoring organization.


 Nearshoring Site selection for operations 
consolidation in
the most favorable labor market

The author John Berry, while not affiliated with Mercer, does incorporate Mercer's proven Site Selection framework and some of our experience throughout the book. He has also authored Tangible Strategies for Intangible Assets with useful insights on how to value Human Capital. In Offshoring Opportunites he shares Mercer's Site Selection framework comprised of labor market, location and business climate decision dimensions companies should explore before deciding on an offshore location (or any location decision for that matter).

 

Labor-related costs are often the largest and most variable factor when looking at options to expand or (re)locate.  Understanding alternative labor markets requires more than sizing up labor costs. The most successful organizations gauge external factors such as overall competitiveness, labor demand in the region, future labor supply, and related costs such as real estate. They also have a keen sensitivity to productivity, quality, customer impact, brand, employee satisfaction, and retention differences across location choices. 


About the author

John Berry, is a management consultant with extensive experience in helping organizations execute information technology strategies designed to deliver measurable value. He is the inventor of three distinct process-driven and structured methodologies which guide companies to reach optimal decisions in several areas of enterprise management.

 

John Berry
P.O. Box 7818
Bend, OR 97708-7818
541 549 8964
according2jb.com


Mercer’s experience guiding companies through these decisions is extensive.  We maintain data on labor supply, quality, and costs on over 600 metropolitan areas and with offices in 150 cities worldwide we bring first hand knowledge.  John Berry’s book provides a good first step in building awareness of the issues around:

  • Site selection
  • The cost/benefit model
  • Vendor selection based upon offshoring goals
  • Exit strategy
  • Performance tracking
  • Governance

 

 


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