Big shocker folks

Sending Jobs off shore DOESN't always save you allot of money

In fact...

Instead, the Ventoro survey found that savings averaged slightly less than 10 percent for all the offshore outsourcing projects that Ventoro reviewed, Hatch said.

The average cost savings increased to 19 percent when Ventoro excluded offshore engagements that were deemed to be a failure by executives or engagements that didn't have a prior baseline to compare cost savings.

However, the report concluded that cost savings of 30 percent is a realistic target for well planned and managed offshore outsourcing projects.

Soooo lets see a 10% savings vs MASSIVE negative publicity

good call big buisness. And whats worse... they really don't know how stupid the call is

Hatch, who prior to founding Ventoro two years ago, worked as a market researcher and executive with Luxsoft, a Russia-based outsourcing company, said that one of the key reasons why outsourcing programs fail is because customers have absurdly unrealistic expectations about cost savings.

It was not unheard of, Hatch said, for customers to go into an offshore outsource engagement expecting to received 80 percent cost savings.

This is a proof in my mind that we do not live in a capitalist system, because a capitalist would realize this doesn't work.

The enterprise has to have a clear idea of what it wants to achieve from the offshore project, and the goal shouldn't be just to reduce labor costs. Instead it should be something with the potential to generate a return on investment, improve business processes to lower operating costs, or serve customers better.

There has to be an organizational chart that clearly delineates roles and leadership responsibility between the offshore team and the onshore team, the report concluded. Without this, neither team will have a clear idea of how to meet project objectives.

Finally, enterprises have to recognize that achieving ROI from an offshore outsourcing project won't happen overnight, the report said; they have to be willing to set realistic goals for cost savings and expect that it will take time to realize potential cost savings and ROI.

In other words if you can't make a better widget... don't move widget production overseas