11th Blog

A topic that was discussed in class not too long ago was offshoring. This is a type of outsourcing, it is the relocation of an organizations business processes to a lower cost location. That includes both manufacturing and production. Many of our companies here have offices in India or other foreign countries, and to call over there to them there is a huge phone bill. Now they can use Skype instead of relying on actual phone calls.

Skype has single handedly removed the communication constraint from these companies. It allows employees from different locations to communicate freely without the fear of increasing the communication costs. Since 2005 the effect on productivity of Skype is believed to be 10% or greater, and I can only imagine that it is much higher now this year.

I think that this is a great way of being more efficient in the offshore actions of our companies that are trying to be more responsible with the money and where it goes. Also, if you watch news or late shows you can see now and then that some celebrities just use Skype instead of flying to the actual show. It's so amazing.

I'm copying and pasting the following from:

http://www.sourcingmag.com/content/c051214a.asp

Here are some of the ways Skype has revolutionized communication between global teams:

• The basic teleconference equipment is expensive; therefore, companies were able to buy only a limited number of devices. The use of Skype through computer speakers has reduced the need for expensive teleconference equipment.
• Teleconference bridges in most developing countries don’t exist. In places where they do, the expense is out of reach for typical global teams. Skype’s conference facility has reduced the need for teleconference bridges for conference calls with five or fewer participants.
• Skype has increased the ability of the teams to collaborate, since they can use voice and IM simultaneously. Written communication is still the preference for sharing source code snippets, Web site details, phone numbers, etc.
• Skype also allows for impromptu communication. Due to the time zone difference between countries like US and India, there’s a need to communicate during early morning or late evening hours. Often phone calls during late hours catch people during dinner or after they have gone to bed. Skype allows users to see who is online before the call is made.
• The superior quality of Skype calls has encouraged users to communicate using voice rather than email or IM. This not only results in better communication but also helps in building better relationships between team members who are geographically distributed.