The Decline In Offshoring Satisfaction

This is interesting.

Buyers of outsourcing services in growing numbers are dissatisfied with offshore service providers, prematurely terminating contracts and struggling to harvest the full value of their outsourcing relationships — even as many of those same companies plan to increase their level of outsourcing over the next 12 months, according to new research by DiamondCluster International, the global management consulting firm.

According to DiamondCluster International's 2005 Global IT Outsourcing Study the number of buyers prematurely terminating an outsourcing relationship has doubled to 51 percent while the number of buyers satisfied with their offshoring providers has plummeted from 79 percent to 62 percent.

I'll say again what I think about offshoring. Too many companies don't think it through clearly. It is not evil in and of itself (like some would claim). It is a tool. But, like the old saying "to the man with a hammer every problem looks like a nail," companies have seen offshoring as a way to save money without accurately evaluating other factors. Business problems are complex and multidimensional. That is what makes them so much fun to work on, but that is also why it is so easy to overlook something and end up with a bad decision.