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What drives offshoring: Just low cost or other factors?

Professor San Murugesan from Southern Cross University, Australia, recently answered this question on Infosys' blog on "Managing Offshore IT".  He conducts research in information retrieval, wireless internet technologies and applications, web engineering, IT adoption, globalization and offshoring.

An excerpt:

... In advanced economies such as the US, UK and Australia, there is strong negative perception about and opposition to outsourcing (offshoring). Their major concern is job loss, though other issues such as privacy and integrity of customers’ information and intellectual property take prominence. As a journalist wrote in an Australian newspaper recently, for enterprises that offshore its service needs, it is the question of their survivability, improving their competitiveness and providing better customer service in cost-effective ways, rather than how and where it gets services accomplished. If they don’t offshore some of their services, some of the enterprises can’t remain competitive and sustain their business contributing to further job loss and strain on economy and the society.

Read full post here.

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I would say both low cost & other factors like, required skills, man power, project management etc...

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