Impact Sourcing

Here’s a really interesting read about two companies that are taking business process outsourcing the ‘bottom of the pyramid’ through ‘ethical outsourcing’;

New York Times Blog Post

I was fascinated by the lateral thinking that has gone in to both business models, turning people whose educational levels have left them largely outside the benefits of globalization, in to productive contributors through the power of the internet. As the article acknowledges, most of the attention to ‘the bottom of the pyramid’ has seen the people as potential consumers. This looks at that model very differently, seeing the potential for these people to be economically productive, with the trade-off being their education, development and ability to engage permanently with the global economy.

I am sure that in developed countries this will be subjected to even more of the kinds of criticism that have been there for more standard outsourcing (in fact some of the comments posted to the New York Times website in response to the article already reflect this) about ‘exploitation’ of workers in developing countries to replace the jobs of employees in the US and other developed countries. As soon as the article refers to people within these companies earning $5.00 a day, the western reader misses the implications of what this means as upliftment from the $3.00 that person was previously existing on. How does a 66% improvement in income represent exploitation or cruelty. As for the concern about the loss of (far higher paying jobs) in developing countries, I wonder whether most of these people ever wonder where their low inflation over the last few years has come from. Cost reductions from globalization have funded innovation as well as price control which has been passed on to western consumers through low inflation.

So, such programmes will come under attack for political or misguided ideological reasons. However, from where I sit I believe they have immense potential.


One Response

  1. Nice blog, All the best to you!

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