|The United States Outsourcing Controversy: Capitalism vs. Ethics|
The United States is the country with the greatest demand for outsourced services from third party providers all over the world. In India, for instance, the majority of outsourced assignments are received from North American clients. The nation-internal debate on the issue of outsourcing has been vibrant throughout the past few years. American corporations point at the major cost advantages and acceleration of productivity with help of the global business strategy. Concerned citizens highlight issues such as downsizing or quality loss as negative consequences of outsourcing engagements. Indeed, there seem to be those who hail the global phenomenon and those who condemn the practice. This article portrays both, the supportive and opposing arguments for offshore outsourcing.
US-based businesses gain significant competitive advantages from outsourcing, a circumstance that positively strengthens the American economy and its players. Outsourcing to an offshore development company implies to safe precious development time that can be used for the company’s core activities instead. If a US company outsources to India, for example, the time differences between the two nations allows 24/7 productivity. Furthermore, precious resources, innovative technologies and professional knowledge from other nations is made available through the collaboration with offshore companies from other regions of the globe.
In the perception of many US citizens, the process of outsourcing work to an external service provider goes hand in hand with the strategy of downsizing. In order to profit from the full potential of maximal cost reduction through outsourcing, companies often replace their in-house staff with the offshore provider team. A recent Forrester research study reveals that US $ 3.3 million jobs are likely to be outsourced by 2015 and in the realm of IT outsourcing, 472, 632 jobs are expected to move offshore in the next four years. Adding to the fear of Americans, those jobs are not anymore low-skilled labor but highly professional positions.
Having these economic benefits as well as the ethical concerns and fears in mind, it becomes a tough decision to judge on the practice of outsourcing. Barak Obama, the President Incumbent of the United States, tried to make exactly this judgment when he recently came to visit India. In the attempt to address the outsourcing relationship between the two nations, the politician concluded his visit with a positive attitude towards offshore outsourcing. In Obama’s opinion, the practice is a business strategy that brings positive effects such as social improvements, job creation and accelerated growth to both nations involved. Companies who stay competitive on global market with help of outsourcing enrich the US economy significantly and are able to create many domestic jobs as well.
To sum up, it is needless to say that outsourcing is a two-way-street. On the one hand, the involved parties and their nations might highly benefit from outsourcing engagements. In other cases, ethical issues might transform the practice of outsourcing into a highly controversial issue. As with any business practice in a global, capitalistic economy, offshore outsourcing is neither black nor white per se. What matters is how such strategies are applied and how actors integrate social responsibility in their strategies. At least in theory, such truly global relationships might help to improve political relations between nations and secure crucial trade relationships.