The Horses on National Public Radio: is this the age of homeshoring?

If you happened to be listening to National Public Radio yesterday afternoon, you would have heard an interesting discussion on the rise of homeshoring on their All Things Considered afternoon show. 

“So what’s new, then”, I hear you mutter over your espresso and boiled kippers…

In a bid to sound a bit clever, my good friend Philip Peters over at Zagada (which does some excellent analytics on the global sourcing space), pulled some data to discover that at least 110,000 home-based call center jobs have been created in the US in the last three years by companies such as Alpine Access, Working Solutions,LiveOps, Arise NA and West!@home.   Now that’s more onshore jobs than the entire size of Cognizant’s global workforce! 

Now while it’s clear that homeshoring is not primed to replace offshore work anytime soon, it clearly is a viable option for front-line customer-facing services at competitive prices.  The removal of the bricks and mortar, telecom costs and use of Cloud-based applications to record/monitor calls is enabling the homeworking environment on a serious scale.  Other areas, such as medical coding, already rely heavily on homeshoring staff to work on administrative tasks with contextual needs. 

Running a business myself, which is entirely “in the Cloud” with folks working largely from their homes, you do start to wonder how quickly the homeshoring model with proliferate, especially with the amount of workers available to switch on their PCs from their houses and start work.  This is one dynamic emerging from the Recession that you can see gaining traction, as more and more people opt to work remotely (or have little choice but to).  Procurement/sourcing, accounting, medical writing, financial research… the number of possibilities for using homeshoring as adjunct delivery options in other BPO areas is clearly apparent.

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8 Comments

  1. Doug Lambert
    Posted August 26, 2010 at 4:03 pm | Permalink

    When we cut corporate taxes to 0 the jobs will come home and the tax revenue will double due to payroll taxes. If we do not change nothing will change and we will continue to fail…

  2. Posted August 26, 2010 at 5:05 pm | Permalink

    I think it’s a viable and sustainable option for many.

    Christine Hueber

  3. Posted August 26, 2010 at 7:15 pm | Permalink

    Phil,

    This has been predicted for at least a couple of decades, but has been rather slow to materialise. Partly it’s been due to the technology – it’s taken a bit longer to get the infrastructure in place than what was anticipated.

    However, we are at the point where it is now a real possibility – the only issue is down to senior management. In most cases, they still don’t trust staff, so want to keep a tighter rein on them than is really necessary.

    There is no real reason why people should not work from home – with suitable broadband connection, and the right systems, people can be really productive, can access required data as easily and as efficiently as they would if they were in an office. With the right procedures, it should be possible for someone to be “at work” but still be able to do housework or gardening, look after kids, even go to the shops!

    I would suggst that when the next generation (the “digital natives”) enter the workforce, we may well see a major change. They are going to be used to getting more from the technology, and if their company doesn’t offer them the opportunity to use it, they WILL go elsewhere to someone that is as switched on as they are. Those organisations that fail to adapt will inevitably lose ground to those that are clued up on the newer ways of working..

    Anthony Sutcliffe

  4. Posted August 27, 2010 at 3:02 am | Permalink

    Phil,

    Home shopping is more or less like window shopping. It brings footfalls but not enough top line. Once the technology takes another leap wherein the seller, buyers & products can have closer physical & emotional exchange then the hope shopping would actually take off.

    Population density and security concerns could also work as catalysts. But a store must be ready to enter the new age market space transactions.

    Gurinder Ahluwalia

  5. Lucky Balaraman
    Posted August 27, 2010 at 7:09 am | Permalink

    Phil,

    It’s a good trend because (1) it creates jobs in a comatose job market and (2) it is likely to snowball since it is in step with current web technology.

    In addition the the NPR article, check out this Huff Post report on how homeshoring is taking hold:

    http://www.huffingtonpost.com/2010/08/20/huffpost-innovators-serie_1_n_689185.html

    Lucky Balaraman

  6. Noel Popwell
    Posted August 27, 2010 at 8:06 am | Permalink

    Phil,

    I have not studied the issue of homeshoring per se, but having worked in the office building industry and done a study on off-shore outsourcing I can provide some insight from that perspective. Large scale home shoring will lead to the collapse of the office building industry. As more employees work from home there will be far less need for office space with a reslting loss of tenants, rent income and industry jobs. The industry will fight this trend and look for legislative fixes. Off-shore outsourcing, on the other hand will, I believe, continue to grow because of the cost savings and the potential for 24/7 operations.

    Noel Popwell

  7. Posted August 30, 2010 at 5:47 am | Permalink

    Hi Phil

    In my understanding, one of the primary reasons to outsource is to get best value against your operational cost spending (“may be low cost – same output” or “same cost – high outputs”).

    I too work with few organizations “in the cloud” and have a reasonable network of businessmen who hire home-workers. Except homeshoring, all outsourcing models have a tool to monitor the inputs ploughed in by a resource at either client’s or the vendor’s end. But in home shoring, most of the jobs are performance based; output delivered is in pro rata with remuneration (may be called commissions) and not on hourly payouts.

    Homeshoring, in any country, could be successful only in the case where the resource has an ability to deliver more quality on low costs with almost no fixed cost attached to it (collections, lead gen, recruitments, data conversion & several other services are already part of it)

    Thnx
    Gurdeep

  8. Missy Garrett
    Posted September 3, 2010 at 7:45 am | Permalink

    Hi Phil,

    Thanks for bring this topic up. While I do think, more and more people are becoming aware of the option of owning a home based business, home-based business companies need to be in the forefront of job opportunities. I contract with one of the businesses you mention (Arise Virtual Solutions) and have been with them for 4 years in the business to business relationship they require. I truly enjoy every opportunity my connection with them has provided, as well as the new and growing client opportunities they are now offering.

    Arise even attended the President’s Job Summit earlier this year, which focused on bringing jobs and job opportunities back to America:

    http://www.whitehouse.gov/photos-and-video/video/president-obama-closes-forum-jobs-and-economic-growth

    It was great to hear you mention a company I’m proud to be a part of.

    Missy Garrett

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