Will Trends Emerge to Move the Call Centers Back Home?
April 10, 2008
The opening of a new call center is not always big headlines, but it can be when that opening is happening in the U.S. Too often, corporations are turning to more cost effective options overseas, leaving many out of work and frustrated with changes. So why the change and why now?
The reality is that there is still plenty money to be saved by implementing an offshoring strategy and many companies are still turning that way, but the economics of such a move are changing. Wages are rising, labor pools are diminishing and the value of the dollar is suffering.
According to Andy Singleton, chief executive of Assemla, a company that organizes distributed software development teams, there has been a 30 percent change in cost over the last half year. For those companies only saving 30 percent by outsourcing its call center labor, offshoring may no longer make economic sense.
While India still presents significant opportunity for those looking to offshore contact center and call center operations, some experts are predicting that the labor savings there could be gone in 5 to 10 years. This possibility has generated some interest in low-cost labor markets in the U.S.
"We've seen quite a few small, rural sourcing projects," says Doug Brown, partner of Brown-Wilson Group, an outsourcing consultancy, in a company statement.
According to a July, 2007 report from the Information Technology Association of America (ITAA), the midsize metropolitan areas and rural communities could provide a 30 percent cost savings over top-tier IT hubs in the U.S. The report also highlighted that overseas outsourcing was here to stay, but acknowledged that there might be niche opportunities in low-cost domestic outsourcing.
Even recently, foreign outsourcing firms are starting to set up shop in the U.S. India’s Wipro announced in August 2007 that it would open a global software development center in Atlanta with plans to hire 500 workers.
One obstacle to the trend to move jobs back here is whether or not highly skilled individuals are available to fill the positions. In one example, AT&T agreed to move IT positions back to the states, but had trouble finding talent. As a result, the company had to set up a training program.
There really is no one-size-fits-all solution when it comes to the call center and contact center industries. Every company is looking at the situation and how it will impact their own bottom line. While trends may be apparent, the end result is too hard to predict.
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