By Varsha Chitale.Confused about off-shoring business research? There is so much hype among both, the proponents and opponents of off-shoring that it is hard to distinguish fact from fiction. Here are a few myths I have encountered in the last more-than-a-decade I have been associated with offshore business research.
1. Off-shoring research is a new phenomenon
I mentioned that I have been connected with business research off-shoring for more than a decade and the practice is actually much older than even that. Some large corporations and database providers started offshore market intelligence operations as early as mid-nineties. Some well-known names include Mellon, Merck, GE, Oracle, Reuters, GM, IBM, Neilsen, Cisco, among others. While data on research off-shoring is scarce, estimates peg the average annual growth at over 70% in the 2003 – 2010 period. In recent years, medium and small companies have also jumped into the fray. Traditional market research firms have been outsourcing (onshore as well as offshore) fieldwork, panels, SPSS analysis, etc. to subcontractors for the longest time. So this is a fairly established best practice among corporates, though it is not very easy to find good case studies on it.
2. Off-shoring yields humongous cost benefits
Off-shoring is not only about costs. While cost benefits from off-shoring can be very substantial, they are sometimes over-stated. There is a very large differential in the salaries of analysts in the developed countries and the popular offshore destinations (like India and the Philippines), and only part of the differential translates into cost savings as there are overheads involved in managing offshore operations.
In addition to cutting costs, off-shoring offers many other benefits such as access to on-demand bandwidth, deeper local knowledge of emerging economies, access to additional/ specialised research competencies at reasonable rates and improvement in efficiencies (24X7 turnaround) as a result of operating across time zones.
3. Finding a research partner is easy
Yes there are a large number of research service providers in many off-shoring destinations. A handful of these are very large pure players in business research with more than 1000 employees; most of them are small players. Some of the large BPOs also have research services in their portfolio. So you do have a lot of choice.
However, choosing the right partner is critical. The partner should have the “right” size, culture, competencies, values, locations, etc. to suit your needs. Above all he/she should be trustworthy. All service providers make the same tall claims about their service and it is not easy to see through the marketing messages. How to choose the right partner is significant topic in itself and a topic for another blog (which I plan to publish shortly).
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