Decisions - Outsourcing - Home grown truth.

(From Financial Director)

Byline: Anthony Harrington.

In the rush to get on board the offshore, low-wage economy outsourcing bandwagon, many organisations are forgetting there are considerable, and potentially lower risk, savings to be made at home. This, at least, is the argument put forward by business process re-engineering consultants Burns eCommerce.

The company's CEO, David Foster, points to the results of a recent survey commissioned by Burns. "We found that 46% of senior financial executives in major UK-based organisations are looking to new automation and process re-engineering projects using IT to deliver improvements and cost savings." This percentage is far higher than the numbers saying they were looking at offshoring (26%).

Typically, companies that assess the payback from re-engineering financial processes such as orders, invoices and remittances estimate that savings can exceed GBP5m annually, while 20% of the sample put the potential savings at between GBP5m-20m.

Foster argues that UK management can find easy wins here at home, without the risk and disruption associated with undertaking large-scale, IT-driven offshoring projects half-way round the world.

However, Deloitte head of research Chris Gentle draws on his firm's extensive study of offshoring projects around the world to argue that any 'either/or' argument between playing at home or playing away for savings is based on a false dichotomy. "The simple truth is that the market is now so tough companies have no choice but to do both," he ...