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Business process outsourcing (BPO) and education

93 Comments · Business outsourcing

Educational attainment is one of the primary drivers of the global outsourcing trend. For years it has been common knowledge that foreign K–12 education is superior to that offered in the United States.

High school graduates In European and Asian countries notoriously outperformed their U.S. counterparts on basic knowledge tests, especially those covering universal topics such as science, mathematics, literature, and world history.

U.S. education analysts have long lamented the gap between U.S. high schoolers and their international peers, but they could always bask in the superiority of American higher education.

No longer. Higher education around the world has caught up with the United States in terms of quality of education and intensity of ongoing research programs.

Once a major drawing card for scholars from around the world, U.S. higher learning no longer occupies the top spot in several important categories.

During the height of the Cold War, the Soviet Union launched the Sputnik satellite, sending shockwaves across the American educational landscape.

Fear of being outdone by Soviet scientific and technologic advances, the United States focused new resources on educational achievement, especially in the sciences and math.

The threat posed today by foreign educational systems overtaking the United States is less obvious.

It has come on slowly and methodically and does not have the drama of a tiny, beeping object circling high above our heads and threatening our security.

Back then the threat was nuclear annihilation. Today, the threat is global economic irrelevance.

Statistics may help crystallize the threat to U.S. domination of global business. In 2002, about 60,000 students in the United States graduated with engineering degrees.

In India and China-the two predominant outsourcing destinations that together comprise one-third of the world’s population- more than 300,000 students graduated with engineering degrees.

Other Asian countries, such as South Korea, Japan, Taiwan, Singapore, and Hong Kong, share a similar focus on science and technical education.

Some commentators speculate that outsourcing is like a universal acid in reverse-it will continue to seep upward unabated and unstoppable into ever-higher-bevel work, including advanced research and product development.

With the overwhelming numbers of technical graduates abroad, perhaps America is not likely to lead the world in the raw numbers of technically educated workers. That is not necessarily a bad thing.

One needs to remember that much of the work done by science and engineering graduates is applied rather than basic research.

And the Asian countries that are excelling in production of technical workers will need each of them to build the next generation of roads, bridges, and telecommunications networks to meet the demands of their burgeoning populations.

The edge in education will not be gained in raw numbers of science and engineering graduates; it is far more likely to go to the country that can take advantage of that low-cost technical labor.

Basic research is dedicated to following the trail of scientific advances wherever it may lead.

This requires immense funding to enable the greatest minds available the freedom to pursue their interests without worry about commercial potential.

Of course, the goal of all federally funded basic research must be commercialization (or, at least, practical application), but that should not be the day-to-day role of those who are responsible for pushing the boundaries of knowledge.

Leadership in the coming age of worldwide outsourcing will go to those countries who produce the breakthroughs in basic research and who develop the entrepreneurs and managers skilled in commercializing the output of those research programs.

The United States continues to lead the world in basic research investment and in business/management education.

It also has the most nurturing cultural, economic, and political systems to encourage risk takers and entrepreneurs to find ways to bring new products and services no market.

The intelligent entrepreneurs today, in whatever country they may call home, will do well to recognize the incredible opportunities for rapid scalability through leveraging global labor resources.

There has been some response in higher education to help domestic companies take advantage of BPO.

The Massachusetts Institute of Technology (MIT) entertained a standing-room-only crowd in a first-of-its-kind course on outsourcing during Spring 2004.

The course is co-taught, appropriately enough, by Indian MIT professor Amar Gupta. Former clear and economist Lester Thurow is the other professor of record in this class, which is liberally sprinkled with guest speakers from the likes of Accenture and other large outsourcing consultancies.

The students run through simulations of outsourcing projects, which include occasional monkey wrenches, such as simulated terrorist threats against offshore ventures.


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