Why Digital Marketers Must Consider Outsourcing

It was easy for white collar workers to be smug during the 1980s. Their blue-collar counterparts faced a dire future as hands-on jobs increasingly went overseas to low cost labour markets. It even made it possible for information workers to extract larger salaries as the profitability of their organisations soared. The white-collar desk jockey rode the wave of efficiency as corporations globalised and consolidated manufacturing.

Life has a funny way of going full circle. And now it’s the turn of the white-collar worker. Non-managerial, creative, or project management white-collar workers are also becoming an endangered species in developed markets.

Yes, you and me reading the Web. We too, will be outsourced. Accountants, IP lawyers, engineers, computer programmers (insert university educated profession here).

It’s easy to dismiss this as a throw away statement. But before you do, consider this: In India each year, there are over 300,000 engineering graduates and over 400,000 IT graduates who will happily work for 10 percent of what conglomerate X pays you right now. It’s only a matter of time before large corporations, which usually struggle for top-line growth, can get over the emotional barrier of having a large corporate head office and go offshore. The spreadsheet will make that decision for them. But this time the barriers will be lower than when all the call centers went overseas. Why? Consumers won’t even notice, and there’s no union protection for most white collar workers. Society won’t care either. They are sick of people earning above-average incomes in ivory towers. No one will feel sorry for us.

Micro outsourcing as provided by Elance, Odesk, and Guru for entrepreneurs is just the test case. The head office is next. We can expect to see startups paving the way for large corporations outsourcing everything that can be done with a $500 laptop and broadband connection.

What To Do?

Stop being a factor of production and start organising them. Stuff gets done, things can be built, and anything that is done at a desk is about to disappear to low-cost labour markets. Information workers can survive by undertaking entrepreneurial endeavours – both in the company we work for or one we are building. We must be able to manage complex projects and manage situations and people, not doing stuff. The age of the entrepreneur is about to become something so significant that it changes work and corporations just like the Industrial Revolution did in the 18th and 19th centuries. Today’s entrepreneurs will invent services that large companies must use to stay competitive, just like social media has already changed the advertising landscape. Digital outsourcing is about to significantly change the scope of corporate employment in developed markets.

BRIC nations (Brazil, Russia, India, and China) is an oft-used buzz word in business for good reason. The last remaining jobs that are commodities (read administration) will evaporate leaving only tasks which require one of the three following types of jobs:

• Revenue generating
• Strategic input
• Project management

These roles will remain because they can’t be systemized; they require adaptation and constant innovation.

Revenue generating, strategic input, and project management will change business in far more significant ways than manufacturing going offshore ever did. This time, the main difference is that anyone can play. The digital revolution is not limited to large organisations that have the capacity to invest heavily in change. That’s because changing is cheaper than maintaining the status quo. In fact, it has quite the opposite effect on business. It creates an advantage for small players and those quick to embrace the landscape.

The Internet has made it possible for a startup business to have a global work force from launch date, and the same cost advantages that multinationals have had since they started exporting labour to China and other parts of Asia since the 1960s. Anyone can do it now. With the exclusion of telemarketing, most large corporations have been slow to embrace the financial advantages presented to them by offshoring information work such as design, programming, or even accounting and administration. But it will come, as markets eventually demands that the structure of all large companies minimise cost inputs – they just haven’t caught up yet.

Before you worry about the ethics of ‘offshoring’ there’s some stuff we should know. Exporting labour overseas is ethically sound. It is beneficial both to the recipients and the providers of such work (us). The average computer programmer earns around $1,000 a month in India. In the USA and Australia, it’s more like $7,000 a month. Unethical? Not really. The $1,000 a month versus the average in India of $85 gives new information workers in India a very high standard of living.

When we inject money into developing economies we are increasing the living standards not just for our employees but also for their economy in general. In addition we have the option to pay them above market rates to create loyalty. We have the option to treat our people well and create important cultural exchanges and relationships.

Other people’s time is what we must leverage for business success. A simple business fact time immemorial. Only now we have both currency advantage and virtual access to global markets. We live in a global age, an Internet economy. We all buy goods everyday from overseas and geographical barriers simply won’t exist shortly. So we should just get on board. Protectionist attitudes are outdated. If local people are getting put out of jobs, then they’ve been earning too much for what they’ve been doing anyway. Their outplacement is inevitable. The job of our governments is to re-educate the workforce as technology demands it. So in the spirit of preparation, here are four closing thoughts for digital thought leaders:

• Outsourcing is available to everyone, not just large, powerful companies.
• Offshoring improves living standards.
• Offshoring is ethical and important culturally.
• We must embrace it, or get left behind. There is no choice.