From this article in McKinsey Quarterly, we read:
Companies in the United States and Britain account for roughly 70 percent of the market of companies that are moving their business processes offshore. Relatively liberal employment and labor laws give such companies flexibility in reassigning their activities and eliminating jobs, and they can take advantage of the sizable English-speaking populations in many low-wage countries, such as India, Ireland, the Philippines and South Africa. With a shared language, errors are far less likely and functions that require voice interaction or text-based work are straightforward. The opportunities for continental European and Japanese companies are thus more limited.
and this
India each year produces 2 million college graduates -- more than 80 percent of them English speakers -- while China produces 850,000, though with minimal English skills. Even a small country like the Philippines annually produces 290,000 college graduates, all English speakers.
Will offshoring yield a significant advantage to the US and the UK? It could.
The US and the UK would seem to have a language advantage, in that English is the lingua franca that allows offshoring to work better in English than in French, German, Japanese, or other languages. This is especially the case with the offshoring of call centers. But to the extent that language is a barrier, the advantage probably applies to other activities, including software development.
Globalization really is a fascinating topic.
Some questions: Will the US and the UK truly have an advantage, since English is a lingua franca? How will language differences affect globalization? How will globalization affect English.
Posted by Doug Sauder at November 13, 2003 12:51 AM