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Multinationals rethink outsourcing

Dell's recent decision to direct some customer service calls to help desks in the US, rather than to its call center in Bangalore, India, shows how companies with customer support operations overseas are having to tread a fine line with their clients, some of whom are still surprised to talk to technicians on a different continent.

To analysts and consultants, the outsourcing of technology jobs is a trend that will only grow. In Dell's case, some of its most coveted business customers complained to management that Indian technical support workers relied too heavily on scripted answers and were unable to handle more complex computer problems. While most questions phoned in by home computer users tend to be fairly straightforward -- like how to update software or install a wireless adaptor -- greater expertise is needed to respond to corporate network problems.

A spokesman for Dell, Barry French, said the company was responding to concerns from business customers when it decided last month to route calls from many large business customers to American call centers, though he maintained that it would not be sending fewer calls overall to its operation in India.

"We just flipped a switch," he said, explaining that some consumer calls that had been handled by domestic call centers would now be sent to India.

"What companies are finding is that offshore can be good for generic, commodity services," said Howard Rubin, executive vice president of the Meta Group Inc, a consulting firm. "Corporate customers have problems very local to their applications and very specific to their companies."

Analysts say that along with skill considerations, some companies may be worried about criticism from labor groups and some customers who object to sending jobs overseas. Governments are under particular pressure. This year, half a dozen states are considering that workers hired under state contracts be American citizens or documented workers.

Stephen Lane, research vice president for information technology services at the Aberdeen Group in Boston, said, "There is a backlash and it's building, particularly in sectors like information technology that is still being hard hit by the economy."

Clearly, information technology workers will face more difficulty as technology jobs move to cheaper labor markets abroad. According to a new survey by IDC, a market research company, nearly a quarter of information technology services will be sent offshore by 2007.

While the outsourcing of technical service jobs is reminiscent of the movement of manufacturing jobs overseas in recent decades, analysts say the difference is that the change in the technology industries is occurring faster. And the jobs that are beginning to leave are considered white-collar jobs that have traditionally been protected from competition with foreign workers.

"Companies are getting more aggressive about it," said Chris Disher, an outsourcing specialist with the consulting firm Booz Allen Hamilton.

"The economies are straightforward -- you get an US$80,000 engineer for US$12,000," he said.
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