The Outsourcing of Outsourcing

Long regarded the poster children of outsourcing, major Indian companies like Infosys Technologies are now opening their own offices in low-cost parts of the world, including Mexico, China, and even the U.S.  According to an article in today’s New York Times, rising wages and stronger currency in India, paired with demands for workers who speak languages other than English, are driving these Indian companies to shift their operations overseas and are thereby transforming the traditional model of outsourcing.  Underlying this novel strategy is the idea that companies can replicate their Indian back offices in other countries and train Chinese, Mexican, and Czech employees to be more productive than local outsourcing firms, all the while spending less than they would have in training Indian workers.  Ultimately, this is only the beginning.  As a senior vice President at Infosys puts it, “the future of outsourcing is ‘to take work from any part of the world and do it in any part of the world.’”