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Another example is Shop Direct, which employs 1,200 people in the United Kingdom, opened a call-center in Bangalore in March 2002 and transferred 250 jobs from Britain. Service from the new location has been called poor, and the experiment will end when the office is closed next month. Jobs will be moved back to six call-centers in the United Kingdom. The company was quoted as saying that the
Indian center dealt with orders and customer inquiries, but the level of service was not up to the required standard. The Indian staff had poorer skills than their British counterparts and were ill-equipped to deal with inquires.

The Language Barrier

Sometimes language difference makes the delivery time longer, for example, Cogent Road, which offers e-business solutions for the mortgage banking industry that protect banks from loss by identity potential errors in collateral valuation and loan regulation compliance. When Cogent Road outsourced a project to Calcutta, India, the company was surprised to find that it took twice as long as estimated, due to the language and cultural barriers and 12-hour time difference between India and its San Diego headquarters. Cogent concluded that they would not outsource mission-critical projects to overseas.

Inexperienced Labor

Minneapolis-based Life Time Fitness, a high-growth, nationally expanding health and fitness chain, needed software to evaluate potential new locations for gyms. It looked overseas where it could pay $6 an hour instead of $60 for programmers, and hired a large, reputable Indian outsourcing firm. But it watched its troubles mount. Not only did the offshore team produce code that was full of bugs; they ran up big bills working overtime to fix their mistakes. Life Time Fitness finally canceled the offshore contractors and hired several local programmers. It explained that one reason offshore developers and testers are on such a junior level is because as soon as they gain experience, they are promoted to project management, account management and other non-technical roles.

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* Contributed by -
Vibhor Mittal & Surya Kiran Sharma ,
2nd Year Students,
Shailesh J Mehta School of management, IIT Bombay.