You have heard of offshoring — the practice of companies establishing part of their operations outside the country, i.e., offshore.
Well now one research firm, IDC, points out the growing trend of homeshoring.
Homeshoring is the use of home-based workers, such as customer service agents. Through the use of technology, home-based workers can log onto company systems seamlessly to do their work. They just need a broadband Internet connection, a phone line and a computer. The person at the other end of the telephone or computer, or otherwise receiving the service, has no idea that the person is really working from home.
IDC calls them “homeshored” but the term I found used most often in the search engines is “virtual agent” or “at home” agent.
According to IDC:
“Over time, offshore outsourcing of customer care will be associated more and more with its neglected sibling, homeshoring,” said Stephen Loynd, senior analyst for IDC’s CRM and Customer Care BPO service. “Ironically, outsourcing will therefore be associated not only with the offshoring of U.S. jobs, but also with the expansion of employment opportunities in the United States. Offshoring’s underestimated sibling, homeshoring, is about to hit a growth spurt.”
Today, there are an estimated 112,000 home-based phone representatives in the United States. By 2010, IDC predicts that number could reach over 300,000 as companies increasingly develop and invest in home-based agents, either with their own employees or by hiring outsourcers.
I spoke with IDC’s Stephen Loynd by phone, and he noted that companies of all different sizes are involved in homeshoring — from small and midsize to large multinationals.
From a quick surf through the search engines it appears that a three-tier system frequently applies. Three companies of different sizes end up feeding off the same piece of business, and the impact on small businesses and the self-employed is evident:
- 1. Large companies, such as the Fortune 1000, outsource their customer service needs to virtual agent call-center firms, which are often small or midsize businesses.
- 2. The virtual agent call centers in turn hire home-based workers. Or more likely they contract with the home-based workers as independent contractors.
- 3. The home-based workers may operate under their own self-employed businesses, either small corporations or LLCs.
Hat Tip to IT Facts (an incredibly handy site) for the link to the IDC study.