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Entrepreneurs have long seen outsourcing as a strategy reserved for big business, but technology has made it a more accessible tool for small businesses--and for some small firms, outsourcing has Author: Nancy Mann Jackson. Outsourcing is a cost-saving practice used by companies where a company relies on an external source to get a company need met, whether it be in business processes, information technology. Apr 01,  · But if outsourcing is politically controversial, it's economically tricky, as well. "You learn a lot from making a product, getting customer feedback, and generally doing things yourself," Zahra Eric Wahlgren.

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When Michael Calderone launched his online coffee business inan in-house customer-service department was out of the question. Not only had Calderone never run a call center, the cash-strapped founder of SmilesCoffee. So he outsourced the operation.

It was a disaster. It's not exactly rocket science, outsourcing article newbies sometimes find the process confusing and require some handholding. Unfortunately, Calderone's contractor wasn't up to the task.

So Calderone found another contractor. Now, outsourcing article, nine dedicated and friendly reps assist SmilesCoffee customers with roasting issues, shipping questions, and account information. What's more, the better service comes at half the price. How did Calderone score such a bargain? Calderone, 43, has mixed feelings about using offshore labor. But if SmilesCoffee is to remain competitive, outsourcing article, he figures he has little choice.

Corporate America, of course, has been outsourcing overseas for years, often shipping entire divisions to vast call centers and programming facilities in low-wage countries, outsourcing article.

Only recently has it become possible for entrepreneurs like Calderone to move as few as half a dozen positions to places like China, outsourcing article, India, and the Philippines--where a growing number of contractors are set up specifically to work with small companies. And more small outfits are taking the plunge. In a recent survey of U. No wonder the issue has become such a hot-button topic on the presidential campaign trail.

But if outsourcing is politically controversial, it's economically tricky, as well. Even when it makes bottom-line sense, outsourcing is not something you can rush into. The tiniest details have to be spelled out. If you're handing off customer service, for example, will you want your reps to sound formal or chatty? What makes the chore especially burdensome for small companies is that many lack established processes that can be easily taught through a training manual, outsourcing article, outsourcing article Jai Shekhawat, CEO outsourcing article Chicago-based Fieldglass, which makes software to help manage outsourcing.

That's Calderone's biggest fear. He went so far as to hire a Manila-based manager with extensive customer-service experience to oversee the operation and smooth out any problems between the outsourcing article center and U. Even with the on-site help, outsourcing still means work for Calderone. He spent months developing a page training manual for the reps to use.

He spends about three hours a week on the phone with the manager working out any kinks. And despite his confidence in outsourcing, he accepts its limitations. He has kept the order-taking part of customer service onshore, in Maine, outsourcing article, for example, rather than sending it off to the Philippines. Even if you think you're being clear, your message may not register.

What's more, the Asian engineers would be working after Misiu's U. For a start-up funded with money from friends and family, such efficiencies were irresistible. Hodgen did everything he could to make his first foray into outsourcing a success.

After several months of discussions with the contractor, he flew outsourcing article Taiwan to outsourcing article the team. Back home, he checked in regularly, outsourcing article, promptly responding when the engineers in Taiwan sent documents.

What Hodgen didn't know was that the engineers, who were supposed to be working solely for him, were serving other clients as well. Feedback, he found, often went unheeded. By the time the design was delivered, it was eight months late and the quality of the outsourcing article "fell way short of expectations.

But he'll still keep his costs down: The new contractor is doling out some of the work to an associate in India. Only this time Hodgen will have somebody--the American firm--to manage the process for him. Hodgen could have avoided a lot of pain by hiring a U. It's also important to find a contractor who works with smaller companies.

After all, outsourcing article, an outfit that handles calls for an airline may not be the right fit for a small firm. More modestly sized clients often find themselves neglected.

And on top of outsourcing article operations risks, there are image risks as well. After all, moving work abroad may not win you any popularity contests with customers or employees--particularly when the loss of white-collar jobs to other countries is shaping up outsourcing article a major political issue. The move significantly strained a few friendships. But Sanker makes no apologies. Outsourcing article noncore functions, he says, has enabled CaseStack to hire 11 highly skilled employees here in the United States, and Sanker plans on adding at least 10 more before the end of the year.

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outsourcing article


Jul 30,  · Nexient, a software outsourcing company, reflects the evolving geography of technology work. It holds daily video meetings with one of its clients, Author: Steve Lohr. Disruptive outsourcing: The new normal. Outsourcing-led transformations can address both business and IT challenges. The state of the art is advanced disruptive outsourcing solutions, incorporating emerging technologies to drive innovation, speed to market, enhanced user Author: Douglas Plotkin, John R. Tweardy. Entrepreneurs have long seen outsourcing as a strategy reserved for big business, but technology has made it a more accessible tool for small businesses--and for some small firms, outsourcing has Author: Nancy Mann Jackson.