February 2, 2010
Amidst the discussion of President Obama’s speech, the anxiety of a recovering economy and the need for a new global sourcing agenda; American Onshoring is gaining firmer ground
President Obama recently emphasized that outsourcing to foreign countries was one of the reasons for unemployment in the U.S., he also added, “…it is time to finally slash the tax breaks for companies that ship our jobs overseas and give those tax breaks to companies that create jobs right here in U.S.A.” This is undoubtedly in the interest of the people of America, but has initiated a lot of discussion amongst service providers in other leading destinations. Most outsourcing pundits are already weighing its repercussions. It could also be a major threat to the world’s leading IT and BPO services provider- India- half of whose offshored business comes from the United States.
As for the buyers, it is time (specially in the United States) to re-consider and re-evaluate the pros and cons of offshoring. This will also give most organizations an opportunity to consider other avenues and ways to reduce cost. American onshoring will not go unnoticed this time. After all, the recent survey conducted by research firm Valuenotes Database among 237 publishers, consultants and service providers, largely from the U.S. and UK, notes that though India remains a favoured publishing sourcing destination with 66 per cent of the respondents rooting for it; it is followed by the U.S. with 30 per cent.
Outsourcing to the rural (or non-metropolitan) areas started almost five years ago in selected Tier 2 and Tier 3 cities. Since then, a few organizations have emerged as the front-runners of the American Onshoring business; one of them being Rural America Onshore Sourcing Inc. Christopher Hytry Derrington, CEO, Rural America Onshore Sourcing Inc., says, “The availability of rural American talent which can be acquired at a cost 40% lesser than in the urban areas, now makes rural America an excellent outsourcing venue. This has been made possible by the spread of broadband Internet services. To further encourage the growing trend, the government has allocated $7 Billion to implement broadband in rural areas. Over the next few years, you will see millions of rural-based low-cost Americans entering the virtual workforce.”
In addition to the rise in opportunities of working in a virtual environment, there are initiatives taken by start-up technology companies like California-based, Systems In Motion, that plans to hire 1,085 workers (for IT services) within five years (in Michigan), according to the Michigan Economic Development Corporation. Debashish Sinha, CMO, Systems In Motion, told annarbor.com, “(on competition from offshore vendors)…The service factory model that we’re building will make it such that we are at least cost comparable. We might not be directly competitive but we will definitely be comparable.”
American Onshore Highlights
Cost of American Onshoring is 40% cheaper than that in Urban areas. It could however, be 15-20% more costly than offshoring (for selected low-end services only).
The Government’s $7 Billion fund to implement broadband in rural areas will facilitate millions of Americans joining the virtual rural workforce and earning a living.
Charges for PHP and .Net -based work costs approx. $50 an hour (significantly cheaper than the urban areas).
Customers are allowed to directly interact with developers, and not only with the sales/ account managers.
Same time-zone advantage.
With use of a virtual business model, scaling up is no more a concern in emerging rural onshore outsourcing destinations.
How does it work?
Christopher believes that in order to be competitive and give customers an irresistible combination of price and quality, one must adopt a new business model; one that is not built on brick and mortar but a virtual (online) environment. This is where the broadband plays a very important role. Very often has Christopher rejected talented professionals who were willing to work but had a dial-up connection at home. This kind of business model runs on the effective use of VoIP and Sharepoint services with online applications that track the progress of the project. He adds, “It doesn’t matter whether the members of the development team (assigned to a project) are based in Wisconsin, North Carolina or Texas. They all sit and work on a common task list and a project schedule.”
Such a model is helping the company scale-up in record time (when the need arises) and utilize the rural talent pool in over 12 states. Their goal being to aggregate low-cost rural American talent on a national level to develop application (or software) for small, medium and large companies.
Types of Projects Outsourced
Software Testing and Performance analysis of an Anti-virus software
A leading developer of Anti-virus software for mobiles, in the U.K.
Java API integration with UPS Java API , J2EE applications on Websphere
A web-based solution provider in the U.S.
.Net, iphone app, eCatalog for a product search engine
An application/ software development company in the U.S.
CakePHP, Java and MySQL (for web based packaging software application)
A packaging engineering support solutions provider in the U.S.
PHP, My SQL, web graphics and interactive media for an eCommerce platform
A high-end B2C retailer in the U.S.
Source: Rural America Onshore Sourcing Inc.
Each type of outsourcing has its strengths and weaknesses. Depending on what has to be outsourced, seek more information on American onshoring. For example; in case the job does not have much value added services to it, or it has to do with processing calls (or telemarketing); its best they are offshored. For projects that require higher degree of expertise and market knowledge in IT, marketing or support functions; American onshore service providers may offer a better deal. Christopher believes that higher the complexity of the project, higher will be the advantages of rural onshoring, specially for the U.S. market.
Offshoring is here to stay for longer because of the advantages it offers; but with globalization there is another alternative that companies must consider when taking outsourcing decision. That is, onshoring to rural parts of America. Though this sector is still evolving and will take a few years to gain larger market share, it is already helping thousands of Americans make a living and believe in the power of ‘Yes, we can’.
The Total Cost of Outsourcing: The Rural Alternative
How to use outsourcing to your financial and operational advantage
In today’s tough economy, businesses of all sizes and industries are seeking new ways to maximize profit margins. Outsourcing has been a staple of the corporate diet for years as we search for better and cheaper ways to work. Outsourcing, however, has its costs and operational issues. This webinar shows how the cost of offshoring compares to rural onshoring.
Attend this free webinar to learn:
The Total Cost of Outsourcing: The Rural Alternative
How to use outsourcing to your financial and operational advantage
January 7, 2010 | 2pm EST / 1pm CST / 12pm MST / 11am PST
Not sure you can attend the Webinar?
We’ll send you the on-demand Webinar with slides and audio once it is posted to our Website.
About Your Presenter
Martin is an Executive leader with over 25 years of Engineering & IT management experience at Fortune 100 firms. He is a certified Lean Six Sigma Black Belt with over 12 years of experience in the selection and operation of ITO operations in Europe, Asia, North and South America. Martin specializes in identifying and implementing the processes and controls necessary for successful onshore, nearshore and offshore performance and profitable growth.
About the Presenter:
The Total Cost of Outsourcing:
Thursday, January 7, 2010
2pm EST / 1pm CST /
Space is Limited.
December 15, 2009
December 10th, 2009 by May Advincula Leave a reply »
In an IMF Web Forum, Martin Gardocki from Rural America Onshore Sourcing, discussed the rural alternative in the total cost of outsourcing. Rural America Onshore Sourcing is responsible for finding and aggregating rural talent to provide customers with contract assistance as required for their businesses.
The different types of outsourcing that exist include:
- USA Urban Outsourcing (domestic, urban firms contracted to provide a service)
- Offshoring (contracting with firms in places such as India and China)
- Nearshoring (outsourcing to firms in Central and South America)
- USA Rural Onshoring (domestic firms in rural communities or distributed rural teams contracted to provide a service)
According to Gardocki, “the opportunity of outsourcing is to actually use the capacity and the capability of the outsourcer to drive even further benefits going forward.”
There are 4 basic costs associated with outsourcing which include the following:
1. Labor (cost of personnel and source of savings generated through arbitrage)
2. Transition (cost of identifying, negotiating, and moving work to the outsourcer,
3. Operation (ongoing cost of the relationship)
4. Management reserve (cost of managing the unexpected)
ARBITRAGE: “The simultaneous purchase and sale of an asset in order to profit from a difference in the price. It is a trade that profits by exploiting price differences of identical or similar financial instruments, on different markets or in different forms. Arbitrage exists as a result of market inefficiencies; it provides a mechanism to ensure prices do not deviate substantially from fair value for long periods of time.” –From investopedia.com
Gardocki explains that the evolution of outsourcing began with contracting with urban vendors where good work came at a premium price. With offshore sourcing there was significant cost savings in comparison to urban vendors, but the overhead costs of governing communication and productivity generally add themselves to the equation. Gardocki states, “As people have become more comfortable with the offshore model and companies become more global, the whole concept of having captive offshore development centers has crept up over the last 5-10 years. Basically [you avoid] the middle man markup and [do] it yourself.” In Gardocki’s own experiences, he has known many owners of small to medium sized business where low cost providers did not necessarily work out and their productivity dropped dramatically for every transition which delays the promise of ongoing benefits and a wealth of capability and capacity. According to Gardocki, what is more alarming is the effect on the customers because “they feel the pain in delayed delivery, they feel the pain in increased costs, and basically you’re the one who has to tell them why,” Gardocki explains. As a result, people look for other areas in which they can reduce some overhead of the operation and still get some of the savings.
The Rural Alternative involves domestic firms in rural communities or distributed rural teams contracted to provide a service. There are millions of people willing and able to work from their homes or local offices with strong work ethic and speak the same language. They are technically skilled to meet the demands of today’s information technology and business process outsourcing environment.
The “3 Ps” of rural onshoring include:
- Proximity to broadband (access to internet at speed capable of sustained operation)
- Population Density (depending on the skill and number of personnel required, you can work in a single community or require personnel across multiple regions or states)
- Process disciple (dispersed or remote teams require process rigor to ensure efficient operation. This includes the infrastructure to support collaboration, project management, document management, and standards).
BETHESDA, MARYLAND (November 25, 2009) —Charleston Alexander Diamond Importers today announced the launch of their new website: www.wherethediamondsare.com. “We built our new site to be more user friendly for our growing family of customers worldwide. The new Diamond search feature allows you to choose the shape of the diamond, then narrowing your search with the use of slider bars by making selections such as color, clarity, and price.” said John Sabet, CEO.
The new site has many features, including the Create Your Own ring, which allows one to pick their diamond and their setting; plus a new Create Your Own studs with new software that matches certified diamonds to create a pair of studs. Plus enhanced ecommerce with shopping cart and check out that makes online shopping a breeze.
CADI also announced the: 2009 Designer Trunk Show:
- Featuring some of the Top Bridal Jewelry Designers, Simon G. Henry Daussi, SES Creations, A.Jaffi, Novell Wedding Bands, Dora Wedding Bands, our diamond cutters and many others.
- Launch of Designs by Sabet: Custom designed jewelry, sure to please even the hardest person to shop for on your Christmas list. Designs by Sabet range from sparkling Diamond Bracelets to spectacular Cuff Links.
- All attending will receive special pricing of 20% – 30% throughout the store
- Charleston Alexander Diamond Importers, 7845 Wisconsin Ave, Bethesda, MD
- Show is December 4th, 5th, 6th.
- Admission is FREE
About Charleston Alexander
Charleston Alexander is a premier diamond importer; they import directly from Belgium and Israel. Charleston Alexander is a second-generation family-owned and operated business; they take pride in creating enduring relationships with their customers. Charleston Alexander is the area’s premier diamond importer. That’s because they have more diamonds in one place than any other one place in Virginia, Maryland, or DC.
Safe Harbor Statement: Statements in this press release may contain forward-looking statements based on management’s current expectations, estimates and projections. Words such as “anticipates,” “intends,” “plans,” “estimates,” variations of such words and similar expressions are intended to identify such forward-looking statements. Forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ materially from those projected or implied in the forward-looking statements. Charleston Alexander is not undertaking any obligation to release publicly any updates to any forward looking statements to reflect events or circumstances after the date of this release or to reflect the occurrence of unanticipated events.
For more information contact:
Director of Interactive Marketing
Rural America Onshore Sourcing
888 884 4348 ext 6502
October 31, 2009
Designer Trunk Show 2009
Whereas the standard “jewelry store” orders its diamonds from wholesalers in New York, Charleston Alexander imports directly from Belgium and Israel. Through partnerships formed overseas, Charleston Alexander has established incredible buying power within the diamond industry. Our superior selection is surpassed only by our service. Charleston Alexander is a second-generation family-owned and operated business, and we pride ourselves on creating enduring relationships with our customers.
October 20, 2009
Collaboration Key to Reaching Coalition Goals
Milwaukee —Wired Wisconsin— a non-profit coalition of concerned businesses, organizations, and
individuals who are working to put our state on the cutting edge of technology —announced today that
the organization has added Privacy Counsel LLC, Midwest Renewable Energy Association, and Rural America Onshore Sourcing as strategic partners.
“We are delighted to add these great organizations to our Wired Wisconsin strategic partnerships list,”
said Thad Nation, Executive Director of Wired Wisconsin. “Each of our partners brings invaluable insight
and experience to the table that will enable us to further our coalition goals of fostering collaboration
and educating elected officials and the general public on technology issues in Wisconsin.”
Establishing strategic partnerships with businesses and organizations throughout Wisconsin is crucial to
creating an environment that supports innovative technology, high-tech job creation, and economic
“Broadband deployment is key to bringing and keeping jobs in rural Wisconsin, and Wired Wisconsin’s
dedication to this issue made partnership between our organizations a logical choice,” said Christopher
Hytry Derrington, CEO of Rural America Onshore Sourcing.
Midwest Renewable Energy Association Executive Director Tehri Parker added, “We’re pleased to join as
partners with Wired Wisconsin because of our shared mission to educate consumers and businesses
about renewable energy and other green technology issues.”
“Technologies such as social media—where nothing is private—require a greater understanding of the
rights and responsibilities of its users,” said Liza Barry-Kessler, Managing Partner of Privacy Counsel LLC.
“Partnering with Wired Wisconsin to bring more visibility to this important issue through events such as
our upcoming forum makes a lot of sense.”
The forum, “Governor 2.0: Utilizing Social Media,” will be held on Wednesday, October 28 at 12:00 p.m.
at the Concourse Hotel in Madison, and is free and open to the public.
Wired Wisconsin has over 15 diverse strategic partners, including Badgerland Financial and Rural Partners—organizations both focused on rural community development, MKE Live, a well-known
networking and LinkedIn training company, and three Wisconsin regions of Goodwill Industries.
For more information about becoming a Wired Wisconsin Partner, to see all of our partners, or to learn
more about our upcoming forum, please visit http://www.wiredwisconsin.org.
Wired Wisconsin is a non-profit coalition of concerned individuals, businesses and organizations who are working to put our
state on the cutting edge of technology. The coalition will work to support an environment for innovative technology, high-tech
job creation, and economic growth. Wired Wisconsin will seek to educate consumers, policy makers, and businesses about
technology- related legislative and regulatory issues that impact our lives and advocate for common-sense approaches to spur
innovation and grow the economy. For more information, visit http://www.wiredwisconsin.org.
The Midwest Renewable Energy Association (MREA) is a non-profit 501(C)3 tax exempt organization founded in 1990. Our
mission is to promote renewable energy, energy efficiency, and sustainable living through education and demonstration. For
more information about our events, membership opportunities, ReNews newsletter, or workshops, visit http://www.the-mrea.org.
Rural America Onshore Sourcing is a USA-leading onshoring company. It has state headquarters and business development
offices in Wisconsin, Kentucky, and Ohio and plans for expansion to 19 more states by end of 2011. Rural America Onshore
Sourcing provides information technology and business process outsourcing services using lower cost rural-based professionals
so that companies don’t have to send projects offshore or use expensive urban vendors. A minority owned company, Rural
America Onshore Sourcing enables customers to cut their project and labor costs by up to 40 percent. More information is available at http://www.ruralamericaonshore.com/.
Privacy Counsel, LLC works with companies and organizations to protect their data, their people, and their reputations through
the development of online policies and employee training. Liza Barry-Kessler, Managing Partner of Privacy Counsel LLC, has 15
years of experience as a privacy professional, is a nationally known, award-winning blogger and co-author of two books, Privacy
in the 21st Century: Issues for Public, School, and Academic Libraries and the Global Internet Policy Initiative’s Advocacy
Training Manual, and a contributor to the book Mothering and Blogging. For more information, visit http://www.privacycounsel.net/.