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The Ethics of Outsourcing

November 24th, 2010 :: Thursday Bram

These days, you can outsource anything. You can have a virtual assistant in India checking your phones, a call center in the Philippines handling your customer service and a manufacturer in China creating your product. But there are some ethical questions that go along with the decision to outsource your business’ tasks. Those questions won’t stop you from outsourcing, but they may cause you to think about what you’re outsourcing and how.

Am I Being Fair to My Employees?

If you’ve been working with certain employees for the long term and plan to fire them once you outsource the tasks they currently handle, it’s worth thinking about what that will mean for your employees. You have no obligation to keep on an employee if you find an outsourcing opportunity, but if you have a great working relationship with your employees, simply letting them go can be an uncomfortable prospect. Take a look at the situation and see if there are other opportunities, like offering them some of the tasks that simply can’t be outsourced.

You might also think about your new employees. You might find an outsourcing company that swears $1.50 is a fair wage overseas, but it’s important to look into that for yourself and decide if you’ll really get the value you need from an employee paid at that rate. You may find that not all local organizations are comfortable with the idea that you might be paying such a low rate for your labor, and you’ll need to be able to assure them that you’re paying a fair wage if you want to work with them in the future.

Am I Providing the Best Value to My Customers?

It may sound well and good to hand your customer service off to someone else, but that can easily mean that the first person a new customer interacts with doesn’t speak English as a first language. That’s not necessarily as helpful for your customers as you might hope, and it can make for a less than ideal experience for customers whom you would like to continue selling to. The same goes for manufacturing and other parts of your business you might outsource. You want to be sure that your customers are continuing to get the value they expect from your business if you outsource any part of your company.

If you can’t guarantee that value, that might be a stopping point for your outsourcing plans. You may have a lower margin of profit using local labor or doing something yourself, but you might have lower profits entirely if you can’t keep your customers happy. The changeover just may not be worth it for a small business.

Image by Flickr user Marc Smith (Creative Commons)

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