Global Public Square

Why outsource?

Harvard Business School alumni offer up rationales in a new report based on nearly 10,000 responses to a survey of 50,000 HBS grads.  Note, in particular, a third of respondents cite the need for skilled labor as driving their outsourcing decision.

According to the report:

"During the past year, more than 1,700 respondents were personally involved in decisions about whether to place business activities and jobs in the U.S. or elsewhere. In these choices, the United States competed with virtually the entire world and fared poorly, losing two-thirds of the decisions that were resolved. Facilities involving large numbers of jobs, high-end work, and groups of activities located together moved out of the U.S. much faster than they moved in."

The study found:

"Of the 1,005 location decisions about potentially moving out of the U.S., the most common alternatives considered were China (42 percent), India (38 percent), Brazil (15 percent), Mexico (15 percent), and Singapore (12 percent)."

So what can be done?  The authors have some ideas here.