India's Take on the New BCG Outsourcing Report

A report by an influential consulting firm is exhorting US companies to speed up ‘‘offshoring’’ operations to China and India, including high-powered functions such as research and development.

In blunt terms, the report by the Boston Consulting Group warns American firms that they risk extinction if they hesitate to shift facilities to countries with low costs. That is partly because the potential savings are so vast, but the report also cites a view among US executives that the quality of American workers is deteriorating.

"The largest competitive advantage will lie with those companies that move soonest," the report stated. ‘‘Companies that wait will be caught in a vicious cycle of uncompetitive costs, lost business, underutilised capacity, and the irreversible destruction of value."

Boston Consulting, which counts among its clients many of the biggest corporations in the United States, admonishes them that they have been too reluctant rather than too eager to outsource production to ‘‘LCC’s,’’ or low-cost countries. ‘‘Successful companies ask themselves, ’What must I keep at home?’ rather than ’What can I shift to LCC’s?’ ’’ the report stated. ‘‘Their question is not ‘Why outsource to LCC’s?’ but ‘Why not?’’’

So says India's economic development czars. What say America's ED chiefs?

More here.