Home
>
Small Business
>
Drivng Home the Point - An Outsourcing Story in China

Drivng Home the Point - An Outsourcing Story in China

A few years ago, I visited Beijing for the first time. At Beijing airport, I got into a taxi and paid 450 yuan (about US$54) to get to the city. I was horrified to find out later that the normal taxi fare for the same distance was 60 yuan!

The next time, I went to Suzhou from Beijing. My local friends advised me to take a plane to Shanghai airport and catch a taxi from there. They told me that the taxi fare from Shanghai airport to Suzhou should be around 400 yuan.

When I arrived at Shanghai airport, I saw a middle-aged man holding a placard, with "Suzhou, Wuxi" written on it. He wanted to charge 200 yuan for the ride.

That caught my attention! It was half the price I expected. I checked out the man-he looked pretty decent and it seemed like a good deal. And so I accepted the offer.

The journey

The man carried my luggage to his car, drove me to a nearby spot and asked me to wait. Five minutes later, he came back with another car and another driver. He explained to me that he did not have the licence to drive in Suzhou and had asked his friend to help.

Before parting, I paid him 200 yuan and confirmed with the new driver that he would take me to Suzhou. I transferred my luggage to the new car.

During the trip while chatting with the driver, I realised that he was on the way home to Wuxi, bypassing Suzhou. The man who had "contracted" him had paid him 50 yuan.

His car stopped outside the city of Suzhou. He told me that he was not familiar with the roads of Suzhou and would help me get a taxi.

Within a few minutes, he flagged down a taxi, told the taxi where I wanted to go, paid the taxi driver 10 yuan and transferred my luggage. The rest of the journey was uneventful and I arrived safely at my hotel, on time to meet my customers.

All benefit

There were three persons in this value chain. First, the man at the airport offered to meet my needs at half the normal price. He made his money by outsourcing the "production" to the Wuxi driver, who could do it at a cheaper cost. Second, the Wuxi driver "outsourced" to the Suzhou taxi driver for the same reason.

At the end, the man at the airport earned 150 yuan, while the Wuxi driver earned 40 yuan and the Suzhou taxi driver earned 10 yuan. I was the biggest winner because I saved 200 yuan!

The bottomline is companies should focus on what they are good at, and leverage on others' strengths. But today, many companies still try to do everything themselves in-house.

For instance, IT departments within big corporations try to develop applications that are available in the market-yet non-core to their business.

Many companies also think that manpower cost is fixed, so it is better to work with existing resources than to incur additional costs in IT applications or services.

They think that manpower cost is just basic salary, and forget about the other costs such as bonus and employee benefits, as well as overheads such as recruitment and rental. They underestimate their manpower cost.

The fact is unless you understand the actual costs of a particular process or project, it is difficult to decide if outsourcing is a better alternative.

Besides costs, the question is: can you do a better job than someone who specialises in the field? Just think of the Wuxi and Suzhou taxi drivers.

Source: http://www.justlogin.com

car service from Midway Burlington .. Lockport Chicago limo O’Hare

In The News:

Tech expert Kurt “CyberGuy" Knutsson says a malware app called SpyLend is posing as a financial tool, hitting 100,000-plus downloads.

Tech expert Kurt “CyberGuy" Knutsson says Clone Robotics’ Protoclone mimics humans with 1,000 muscles – too human for comfort.

Tech expert Kurt “CyberGuy" Knutsson urges you to use Apple’s App Privacy Report to see what your apps are really up to.

Tech expert Kurt “CyberGuy" Knutsson talks about how to smoothly transfer your data from an old laptop to a new one using cloud storage or external drives.

Kurt the CyberGuy offers tips to safeguard your personal information as scammers become more sophisticated with scam texts and other methods.

WeRide's unmanned electric delivery van, the Robovan W5, has 194 cubic feet of cargo space and can carry payloads up to about 2,205 pounds

Kurt the CyberGuy recommends deleting 16 browser extensions immediately in response to a report saying more than 3.2 million web users were affected by a security breach.

Stay up to date on the latest AI technology advancements and learn about the challenges and opportunities AI presents now and for the future.

A robotics firm in China claims a robot has performed the world's first humanoid robot front flip, which is significantly more difficult than a backflip.

A digital ID may be even more secure than a physical ID. Storing your driver's license in your Apple Wallet is an ideal solution for commuters.

A cybersecurity firm has shed some light on just how common tax scams have become. Kurt the CyberGuy offers his advice for how to protect your refund.

Lifesize Plans offers immersive walk-throughs that allow customers the opportunity to tour a home's design before construction actually begins.

Stay up to date on the latest AI technology advancements and learn about the challenges and opportunities AI presents now and for the future.

A man invested $4 million in bitcoin and lost it all with a single click when he was targeted by a vishing scam, which uses phone calls to trick people.

Expandable's Touchdown is a designer trailer that promises a luxury off-grid living experience and unfolds into a home in about 15 minutes.

Major employee screening company data breach affects 3.3 million people. Tech expert Kurt “CyberGuy" Knutsson explains what happened and gives five ways to protect your data.

Kurt “CyberGuy" Knutsson reveals mind-blowing tech that gives you sunlight on demand.

New malware "FrigidStealer" targets Mac computers. Tech expert Kurt “CyberGuy" Knutsson offers four ways to stay safe from infostealer malware.

Kurt “CyberGuy" Knutsson talks about how lab-grown muscles power a biohybrid hand for scalable prosthetics and research.

Reports of task scams have significantly risen in the past four years, according to the Federal Trade Commission. Kurt the CyberGuy offers some red flags.

iPhones have a hidden folder that eats up storage without you knowing it. Kurt the CyberGuy offers some tricks to free up storage on your device.

A recent ransomeware attack targeted Zacks, an American investment firm, and a cybercriminal claimed to have stolen records for millions of customers.

Stay up to date on the latest AI technology advancements and learn about the challenges and opportunities AI presents now and for the future.

Researchers unveiled a new soft prosthetic hand that combines the natural coordination patterns of our fingers with the decoding of motoneuron activity in the spinal column.

Accidentally deleting a text message on your iPhone or iPad is not a problem if you still need the message. Apple has a built-in way to recover it.

Drivng Home the Point - An Outsourcing Story in China

Small Business