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BPO Journal

Friday, October 14, 2005

Look Who's Outsourcing

Its not just a corporate solution anymore. Money magazine has an article on how the overworked American is increasingly outsourcing chores, errands and family responsibilities. The principles are similar to business process outsourcing:
  • If the function is non-core and can be serviced efficiently by a specialty service provider, outsource. E.g. clean basement
  • If the function is core, in that it brings significant tangible/ intangible benefits, keep the function in-house. E.g. gardening and stopping to smell the roses.
Of course, effective outsourcing requires a thorough analysis of the true value of outsourcing as well as the operational risks and challenges. This includes an assessment of what your time is worth, your aptitude for the task, potential efficiency improvements and prevailing market prices.

The article states that the supplier market, including specialists and generalists, has seen a boom in the last decade - "You can pay Mike Solito of Auto Buyers Consultants $400 to $600 to buy you a car. He negotiates 40 to 60 car purchases a month on behalf of his clients, twice as many as two years ago. Then there are personal chefs, who number an estimated 9,000 in the U.S. today, up from 400 a decade ago." Generalists, or lifestyle concierges too are experiencing rapid growth in business. "Brooke Bechtold's Chicago client base, for which she does everything from buying gifts to hiring carpet cleaners, is growing 40% a year. There are even online helpers, who have their own group: the International Virtual Assistant Association".

Satisfaction metrics seem relatively more positive in this genre of outsourcing. While its reach and impact have extended to include a wide range of functions, it is too early to predict the sustainability of this market, given rapidly changing economic conditions. Is $3 for a thoughtful, handwritten card that will send your best wishes anywhere in the U.S., on time, well worth it? Or is it too soon to predict the sustainability of the "Thank You" notes market? These are interesting times at our service.

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