History of Outsourcing

Globalization carries different meaning for different people. Some see it a medium to fill up their pockets with wealth at the expense of the poor and downtrodden, and for others it is a gateway to open up free trade between countries.

Whatever, Globalization means to the people across the globe, it has its own history and significance of existence for years.

History speaks out the reason of the evolution of globalization and the benefits and adverse effect it had on various races around the world.

Peep into the early years of history and one can easily view the outsourcing projects that were accomplished by the Americans. The US history endorses that the making of America’s covered wagon covers & clipper ship’s sails was actually a task outsourced to the works in Scotland, with raw material imported from India.

In the 1830s, the textile industry of England reached the peak of its efficiency and this resulted into the inability of Indian manufacturers to complete. Hence the work was outsourced to England.

During the 1970s, in the US computer companies exported their payrolls to outside service providers for processing. The trend continued in the 1980s. During this era accounting services, payroll, billing & word processing all became outsourced tasks. Most of these tasks were outsourced to service providers in the neighboring states. Service providers overseas were not even considered. The main motive for outsourcing was to sharper smaller skills than reshaping the economy.

However, the late 1980s recognized the true power of outsourcing and the process began to emerge as a potential powerful force in transforming global economies. In technological terms, the main focus of outsourcing shifted from its efficiency to its economy & productivity. Outsourcing in the late 1980s was offered to overseas providers by corporations like Kodak and American Standard. This started capturing attention of the public.

Outsourcing is a big business. The business generated a huge amount of global revenues $298.s billion back in 2003. The fact was further affirmed by Gartner Inc. These days many organizations like to outsource with call centers in India.

According to an estimate made by Forrester Research, around 33 million US jobs and $136 billion in wages are expected to move to India, Russia, China, Pakistan & Vietnam by 2015. Europe has taken the responsibility to outsource and is expected to reach nearly 25 percent of total global outsource spending. Carlos Watson, Political analyst for CNN sees a possibility of globalization affect where business set up shop.

He also observes that “while media attention has focused on the corporate exodus to India, three to four times as many jobs have moved to China in the last 15 years”. The reason like in the difference of the kinds of jobs. The majority of jobs outsourced to china are in Manufacturing.

There is more to outsourcing that just payrolls & call centers. You would find its traces in various other fields. A close look in your insurance company and your neighborhood medical clinic, would make you aware of the widespread eminence of outsourcing.

The question that arises in most people’s mind is whether globalization affect the public’s perception of job insecurity and if it does, how can it be resolved?

It may seem that globalization has an ability to make people jobless at the first glance, but a study reveals that these perceptions does not have any significance.

Outsourcing can enhance the world economies in future and with the change in technology one has to embrace new things in order to take a step forward in life.

Author: KPO

3 Responses to “History of Outsourcing”

  1. Thanks for sharing history of outsourcing…..good informative article.

  2. Dr.Ashokan says:

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    Dr.Ashokan
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  3. Santosh says:

    Hi

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