By now, most business people, pundits, and politicians in the United
States and other developed nations have come to grips with the phenomenon of manufacturing
jobs moving offshore: The process is variously referred to as “outsourcing” or
“offshoring.”
But a far bigger wave of change is approaching the shores of those same
developed nations: the globalization of services. Where are the jobs going? Which
companies benefit–or could benefit? How exactly does services offshoring work? How do
you “get in the game”? Who makes a good partner?And what are the policy implications?
The Services Shift answers all these questions, and more, offering powerful insights for
managers, public policymakers, and citizens alike. Leading researchers Robert E. Kennedy
and Ajay Sharma reveal how services offshoring works in both industries and individual
companies, and show how to define and implement realistic services-sourcing goals for your
organization. You’ll learn who’s involved in services offshoring, understand leading
business models, and tour the main geographical centers–from China and India to Hungary,
Russia, Morocco, Brazil, South Africa, and Mauritius. Drawing on detailed interviews with
participants, the authors review the management skill sets associated with successful
services offshoring. Next, they assess policy initiatives in both developing and developed
countries, including U.S. proposals aimed at restricting the offshoring of services.
Finally, they preview the newest trends in services globalization, helping you prepare for
the world as it will be–next year, five years from now, and in a decade.
Services offshoring: what’s different, what’s the same?
How the offshoring of services resembles the offshoring of manufacturing–and the
important ways it differs
Defining a realistic framework for services offshoring
How to set clear goals, define what to offshore, and then execute successfully
Touring the offshore universe: models, locations, activities, and beyond
Understanding all your options–and their tradeoffs and implications
Understanding the broader political and economic implications
How governments are likely to act–on both ends of the provider-to-consumer
spectrum–and how that will impact you
Robert E. Kennedy is the Tom Lantos Professor of Business Administration,
Director of the Global Initiative at University of Michigan’s Ross School of Business,
and Executive Director of the William Davidson Institute (WDI). He spent eight years at
Harvard Business School, researching global strategy and teaching international business
courses. He has consulted and invested venture capital throughout Europe and Asia.
Ajay Sharma is Research Manager for WDI’s Globalization of Services
Initiative. In 1992, he joined Infosys as it was ramping up its offshore software
development business. Later, he joined PriceWaterhouseCoopers as a technology consultant.
Table of Contents
Acknowledgments xv
About the Authors xix
Introduction 1
Chapter 1: Globalization of Services: What, Why, and When 17
Chapter 2: The Economics and Drivers of Offshoring 49
Chapter 3: Making It Real 89
Appendixes for Chapter 3 135
Appendix 3A 135
Locating a Task on the Process Decomposition Compass
Appendix 3B 136
Assessing the Feasibility, Value, and Risk of Potential Outsourcing Efforts
Appendix 3C 138
Assessing the “Offshoreability” of Potential Tasks and Processes
Appendix 3D 140
What’s Typically Covered in an SLA?
Chapter 4: The Supply Side 143
Chapter 5: Shifting Skill Sets 175
Chapter 6: The Services Shift: Policy Implications 199
Chapter 7: Looking Ahead 245
Appendixes for Chapter 4 263
Appendix 4A 263
Country Attractiveness
Appendix 4B 264
Country Notes
Appendix 4C 272
Country Profiles
Index 317
352 pages, Hardcover