Onshoring vs. Offshoring – Service- Support Businesses Are Coming Back Home

Resource Origin:  Chief Executive.net by John. A Meyer

“The pitfalls of offshoring include miscommunication, political instability, and security risks. Offshoring location costs have grown by the double digits on an annualized basis, while the cost of foreign labor is also on the rise, according to the International Labour Organization. In addition, customers’ dissatisfaction with the language barrier has been repeatedly vocalized, and more CEOs are realizing that the cost of losing a customer or providing a sub-optimal experience is expensive and impacts the brand.

Conversely, onshoring offers more control and a higher standard of service from agents who are part of the domestic fabric, share an affinity for a company’s products, and can humanize interactions, where customers say, “I like dealing with XYZ company because they understand me.”

In addition, onshoring has become more affordable and attractive. Deloitte finds that IT is leading the way back to onshore, with the airline, software and retail industries closely following. General Motors, for example, is onshoring all of its IT today, while Collaborative Consulting reports that Forrester has measured a 100%, year-over-year growth in domestic sourcing for IT.

In addition to IT, customer service is also returning fast. With the labor gap narrowing, companies can afford to give customers the quality service they are demanding. As businesses try to distinguish their brands in a challenging U.S. economy, they are seeking the best customer experience possible, and that means bringing customer service back home…”


You must be a SIG member and logged in to view this document.