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Business process outsourcing in the UK.


Grzegorz_ 51 | 6,163
21 Mar 2011 #1
How often is simple office work outsourced to low cost countries by British companies ? Actually generally western, not necessarily British... Where does it go to ? Usually India I assume... ? How much does it cost in comparision with Western Europe ? Is there anything wrong with the way they do it ? I ask because in the last few years Poland was flooded with such investments. Generally basic accounting, customer service, supply chain management etc. mostly entry level jobs. Especially Kraków and Wrocław are packed up the roof with these companies and more are coming... Why ? Lower costs than in the west of course but on the other hand India must be several times cheaper than Poland. I heard time zone is a problem but wouldn't they do night shifts for a bit more (still very little) money there ? Besides not all of that work must be done on the same days.
Bzibzioh
21 Mar 2011 #2
Lower costs than in the west of course but on the other hand India must be several times cheaper than Poland.

There is problem with Indian pronunciation in over the phone customer service. Many companies used them (American Express, my internet company, etc) but recently dropped them as people (including me) had hard time understanding them. And there is an issue of them just reading the script instead of listening and giving you actual information.
Raj_ryder 10 | 106
21 Mar 2011 #3
How often is simple office work outsourced to low cost countries by British companies ?

Very often.

Usually India I assume... ?

Not just India but almost every country in south east asia.

How much does it cost in comparision with Western Europe ?

If I am not mistaken, i think the minimum wage in lets say germany would be around 6-8 euros/hour. I'd pay an Indian something along the same lines for eight hours. Which would mean that it costs 1/8th of the minimum wage which you would pay somebody to work for 8 eight hours in Europe.

Is there anything wrong with the way they do it ?

Well a lot of people crib about it and call it exploitation. I just call it globalization

Lower costs than in the west of course but on the other hand India must be several times cheaper than Poland.

Not really. For instance, in Lodz where i live infosys(which is an indian company) has a back office for accounting. The people who work there are paid something like 2500 zl net( i have a friend who works there). A person who has experience in accounting in India would charge more. Call centers in India employ those people who speak reasonable english but don't have any other skills. Management jobs in India are quite highly paid. Accounting is in great demand as are programmers and SAP specialists. They are expensive as well.

I heard time zone is a problem but wouldn't they do night shifts for a bit more (still very little) money there ?

They do night shifts as it is. For example, if someone works on a US based process, the difference leaves no choice but to work at nights.
Lodz_The_Boat 32 | 1,535
21 Mar 2011 #4
Race to the bottom is the usual scenario. This will keep happening, as Indian wages are still lower. However, not for long because in India I was informed that wages were rising as a rate of 12.9% ... which is the highest in the world (with China at around 9%). This would mean that after 10 to 15 years, India is not going to remain a popular destination for western companies to outsource. They also have their domestic economy getting very strong.

In contrast to this, the Polish wages are increasing, but at a decreasing rate. In such a situation, I believe that in the near future we will have more FDIs as well as become a popular destination for western outsourcing.

Talking about English, not all Poles are very good in this language ... while Indians are definitely much better atleast in the grammar. I know this well because I've been in India, Bangladesh and Malaysia on trips sponsored by my previous job (which imported garment).

India is just on the verge of becoming the "not so lucrative" destination. Plus their software exports are increasing so rapidly, that they might take the front seat in that, which would mean that they will not only export but invent softwares. Right now they take orders to create custom made softwares, they are one of the biggest I heard. Its cheaper, reliable and very efficient industry booming in there.

However, due to their big poor class (mainly in the villages) ... they are still going to have a low GDP per capita. However, this will not attract the service outsourcing, because India have 250 mn plus people who would be educated enough to work for the domestic market (which is increasingly powerful) as well as the decreasing western direct investments and outsourcing.

Now looking at Poland from there, we have less workforce (obviously), but we have the infrastructure to cater the needs of the western firms. I think we will see a definite advantage here.
Raj_ryder 10 | 106
21 Mar 2011 #5
However, not for long because in India I was informed that wages were rising as a rate of 12.9% ... which is the highest in the world (with China at around 9%).

Yeah everytime the government releases a statistic like that, i have a laugh. I don't even know how they manage to calculate that considering 30% of the people live below a dollar a day and huge majority don't declare their incomes to the government.

They also have their domestic economy getting very strong.

You've hit the nail on the head. That is India's biggest advantage.

Plus their software exports are increasing so rapidly, that they might take the front seat in that, which would mean that they will not only export but invent softwares.

They do that even now.

Right now they take orders to create custom made softwares, they are one of the biggest I heard. Its cheaper, reliable and very efficient industry booming in there.

It was certainly booming but now it has stabilized. Have you heard of Bangalore? But in some ways(and ofcourse this is my opinion) the IT sector has screwed up the Indian economy.

However, due to their big poor class (mainly in the villages) ... they are still going to have a low GDP per capita.

True for every BRIC country. Wealth distribution sucks. India is a perfect example of a dysfunctional government and society. Would you belive that we have the highest number of millionaires in the world just after the States? It's criminal to be honest.

Now looking at Poland from there, we have less workforce (obviously), but we have the infrastructure to cater the needs of the western firms.

In my opinion, what Poland really needs are more entrepreneurs ans SME's.
Lodz_The_Boat 32 | 1,535
21 Mar 2011 #6
Exactly. We need more innovative ideas with which we can do business.

30% of the people live below a dollar a day and huge majority don't declare their incomes to the government.

True, but that statistics are for the skilled labor force only.

IT sector has screwed up the Indian economy.

How? I thought that they did it so well that it became their pride?

Would you belive that we have the highest number of millionaires in the world just after the States? It's criminal to be honest.

What is criminal in having millionaires?

Anyways, you are an Indian? What makes you come to Poland :) ... I am a native of Lodz by the way, so welcome!

Please stay on topic
Raj_ryder 10 | 106
21 Mar 2011 #7
How? I thought that they did it so well that it became their pride?

Yes because the government decided to invest huge amounts of money into the infrastructure required to meet the IT boom. They took the moey out from the agricultural sector(which most poor people are dependent on). This increased the disparity in wealth even more.

What is criminal in having millionaires?

Wouldn't you say its criminal when one man has enough wealth to feed 10% of the population but the government taxes him less than they tax me?

Anyways, you are an Indian? What makes you come to Poland :) ... I am a native of Lodz by the way, so welcome!

I ve been in Poland for quite a while now andd yeah I live in Lodz. It's nice...Would love to live in Krakow though.

am a native of Lodz by the way, so welcome!

Im not exactly new here...joined the website two years ago but after sometime I stopped posting. Its really a waste of time. tooo many idiots in the forum for my taste. they dont really talk about Poland anyway. Im just bored this evening so I thought i might pop in.
frd 7 | 1,399
21 Mar 2011 #8
I know of several Silesia based IT companies that are working over outsourced projects UK projects, programmers and project managers with 2-3 year experience earn around 5-6k zlotys. ( these are all small - medium sized companies )
OP Grzegorz_ 51 | 6,163
22 Mar 2011 #9
Thanks for the feedback.

There is problem with Indian pronunciation in over the phone customer service.

I heard that, however voice related services seem to be only a small part of this sector.

A person who has experience in accounting in India would charge more.

Very interesting. I would have expected the salary for that job in India to be at lest 2-3 times lower than in Poland.
marcellarhughes
13 Apr 2011 #10
Outsourcing can really help you on your business. It basically cause a very competitive environment where the cost of labor would be cheaper, and companies can turn profit with cheaper costs.

India is leading country in the IT World. Many Indian Company providing IT support sand services in very low cost. My UK IT Outsourcing is my plan to make it on India.
dineshkumar11 - | 1
13 Oct 2011 #11
Outsourcing really assists you on your business. It essentially causes a very aggressive environment where the cost of labor would be affordable, and companies can turn profit with low costs.

By,
Informaticsoutsourcing
LwowskaKrakow 28 | 431
13 Oct 2011 #12
the BIC(Brazil, India, China) area is getting a lot of outsourcing and a huge growth, however Poland is renowned for it excellent workforce and skilled professionals in many fields such as HiTech but also the absence of labour laws for manual workers( We can see construction workers on building roofs without any security,crazy) ,the cheaper costs of labour( and no strikes) encourages companies to set up plants and invest a lot in what they call "the new Europe".
hythorn 3 | 580
13 Oct 2011 #13
another thing to remember about outsourcing to Poland as opposed to India is that you can have call centre staff who speak Dutch or German or lots of other European languages. Whereas in India, it is English or nothing

Many English companies would not want to have branch offices throughout Europe so having an info line which their Portuguese customers could call would be handy
pudortiz - | 5
17 Feb 2012 #14
Some people tend to think of outsourcing, in general, as a bad thing. Aside from "it", reducing jobs in their country, they also don't want change. But change is constant and if you're not open to it, then you're gonna be left behind. Instead of stopping outsourcing, they should just learn to accept and adapt to it.

One advantage of outsourcing, other than it being cost effective is that you could hire the best employees anywhere around the world. May it be in India, Philippines, Poland, etc.

Outsourcing got lots of benefits but you have to keep in mind that it might also have some negative results. Most business owners find some ways to avoid those disadvantages by using strategies to make outsourcing successful.


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