Listen to Coronavirus Patient Zero
Moving To International Shores
The world is quickly turning into a global village. The rapid developments in telecommunications have given a big boost to this movement. The entire world is slowly turning into a common market, with the Internet playing quite a big role in this development. The growth of e-commerce is an example of how people from Canada can just as easily sell goods to those in Australia as they might to people a few buildings away. Businesses, both big and small, have not been slow to respond to the need to reach out to a much wider range of people. One of the results of this coming together of the world is seen in the growth of off-shoring.
Why should a company decide to take to off-shoring? The primary reason for this is that companies want to reduce their expenditure as far as possible. If this means having a setup on a different continent so that the costs may reduce considerably, so be it. Transportation is certainly not a problem in this communication crazy world of ours. So China and India have emerged as top off-shoring destinations for countries from all parts of the globe. A common mistake that we all make is to assume that off-shoring is the same as outsourcing.
Well, here is some information for you. The two are quite different. Outsourcing generally means giving out a contract to do a piece of work to an external company. However, off-shoring refers the transferring of a part of the operations to a different unit (either of the same company or a different one) but which is situated on different shores. Outsourcing could be done within the same country, but not off-shoring. The latter necessarily refers to a geographical distance. Off-shoring is generally of two main types. These are production off-shoring and services off-shoring. The prime example of production off-shoring can be seen in the case of China, where production costs are minimum. Thus, companies that want to save on their production costs generally make a beeline for Chinese locations to produce their goods.
As far as services off-shoring is concerned, the best example is that of India. Thanks to the unbelievable expansion of the telecom industry and thanks to the great Internet boom, after the 1990s, there was an opening for countries which would incur lower costs to enter the services field. Thus, India, with her pool of English-speaking people turned out to be the perfect fit. Of course, off-shoring is not limited to these two countries, and it continues to increase its influence everyday.