Outsourcing in America: There's No Place Like Home

Oklahoma City, Okla. Hattiesburg, Miss. Halifax, Nova Scotia. Ainsworth, Neb. On the surface, these towns may appear to have little in common with each other, let alone offshore-outsourcing hotbeds such as Bangalore, India or Taipei, Taiwan. But, as solution providers have learned, looks can be deceiving.

Indeed, a handful of solution providers have put a new, patriotic spin on the IT outsourcing phenomenon by fighting the offshore tide and remaining in North America. The trick? They are setting up everything from technical-support call centers to high-level software-development centers in smaller, underserved cities with untapped labor pools. For example, earlier this year, Denver-based Ciber launched its first "Cibersite," a domestic application-development center in Oklahoma City. The Cibersite created approximately 200 new jobs, and the company says it has a strong pipeline and several clients already using the center, including a federal government agency and a global telecom firm. In addition, BearingPoint has created a software-development center in Hattiesburg that will focus on government clients.

The trend of domestic, or "on-shore," outsourcing isn't new; Keane, which has several development centers overseas, constructed one of its first centers in Halifax, a small coastal city in Canada known more for fishing than technology. And large integrators, such as Cognizant Technology Solutions, have built outsourcing centers in major cities like Phoenix. But, today, far-flung rural locations and small cities are in fashion.

Take Technologent, for example. The enterprise solution provider, a Sun Microsystems iForce partner, was founded in 2002 and is headquartered in Rancho Santa Margarita, Calif. A year after launching the solution provider, owner and CEO Tom Galloway began looking at rural regions to set up a technical-support and sales-call center. What better place to do so, he thought, than near his hometown in Nebraska? Thus, two years ago, Technologent built a call center in the small town of Ainsworth. Galloway believed the call center would allow the solution provider to enhance its customer relationships and to take a more proactive position with demand generation.

id
unit-1659132512259
type
Sponsored post

After some intensive training for the newly--and locally--hired staff, the call center made 100,000 outbound calls in its first month to customers with Sun services contracts that were about to expire. The effort produced immediate results: Renewal rates for service contracts went through the roof and made Technologent one of the fastest-growing Sun VARs in North America.

"We wanted to create jobs in the heartland and keep our customer service and support here in the U.S.," Galloway says.

To get the operation off the ground, however, Technologent needed help. Galloway and his executives quickly found that Nebraska state officials were eager to assist the company in procuring a federal loan of approximately $500,000 to purchase the call center, which a previous employer had recently closed. In addition, Technologent leaned on Sun and the solution provider's primary distributor, Arrow's MOCA division, to help train local residents with little to no technology experience.

"We're taking people from rural America whose backgrounds may be in agriculture, and training them in technology," Galloway says. "The cost of the training is significant, but it has created a tremendous opportunity for both sides."

What Technologent may lose in higher labor costs--employees get health care and dental coverage--Galloway believes it gains by keeping the work in the United States and avoiding language and cultural barriers that firms in Asia have encountered. Technologent is currently working on two new call centers, which Galloway says will be able to provide call-center capabilities to other tech firms. Maybe that will inspire more IT companies to try domestic outsourcing.