CH 11: “Smaller Indian Outsourcers in Favor During Recession.”{0}
This article is about small to medium size outsources in India that are doing really well despite economic conditions due to the low cost of doing business with them. The reason they are getting a lot of business is because they are willing to take on smaller projects which is yielding them favor with their customers. Another factor which is helping them is the reluctance of larger firms to drop their prices, and their unwillingness to take on contracts that are lower than $6 million U.S. The small firms often specialize and offer expertise in specific industries which is also yielding them a lot of new customers. The success of these smaller and medium sized outsourcers have led to many other outsourcers adopting a similar strategy, and start specializing in specific areas of business. Even though businesses may be tempted to switch to a smaller size firm they need to take account of more than just the price of these firms. While these smaller firms do provide service at a cheaper price they are not as productive as some of the larger firms, and businesses need to take this into consideration before switching. This article is related to the chapter because it talks about outsourcing which is an important topic which is discussed within the chapter. I find this article interesting because it talks about competition in India in the field of outsourcing. A higher level of competition in India will lead to lower prices, which means this will significantly affect American jobs due to their inability to compete with such low prices. While increased competition may be good for American businesses it is another blow to American workers.
Ribeiro, J. (2009). Smaller Indian Outsourcers in Favor During Recession. IDG New Service. Retrieved November 12, 2009, from http://www.pcworld.com/article/171720/smaller_indian_outsourcers_in_favor_during_recession.html