How to offshore - and maintain a good reputation

For many companies the question is not whether to outsource work to offshore locations in India or elsewhere, but how to protect their reputations from the negative backlash to the issue - regardless of whether that backlash is warranted.

Sally Costerton, head of corporate communications at PR consultancy Hill & Knowlton, said: "Having a good reputation is clearly good for a business' bottom line."

She and other industry experts were speaking at an offshoring conference yesterday in London sponsored by Indian IT services and BPO provider NIIT.

Public perception is especially important in the post-Enron world, in which the media and customers are critical of corporate behaviour.

CEOs rank unethical corporate behaviour as one of the top two threats to a company's reputation, according to recent poll of 250 CEOs worldwide conducted by Hill & Knowlton. The other is product and service problems, followed closely by customer criticism.

When it comes to offshoring projects, "companies have got to be honest with staff and the press," Costerton said. "They've got to get the story out early and explain their business strategy."

"Don't do it and hope no one finds out... that can be very expensive," she warned.

In IT, the biggest public concern is security, she said. So "make sure people know you do it well."

Communication is also key to developing good relationships with unions.

Rory Murphy, joint general secretary of finance workers' union Unifi, said that although he's not against offshoring altogether, he stressed that "we've got to get it right".

That includes the board consulting with employees as soon as they start to consider offshoring jobs.

"Unions want to understand the business issues" behind the decision to offshore, he said.

Murphy also expressed the union's interest in widening the debate about offshoring to include more than just short-term cost benefits. "There needs to be discussion about the long-term impacts [of offshoring] - how it impacts the society and the community - and we don't feel we're having that discussion now."

Along with speaking candidly to the press and employees, companies looking to offshore need to be sure customers retain a high opinion of the company. One way to do this is to make sure customer service is top-notch.

If customers have a bad experience with the company, for example via a call centre, "their feeling about the brand is damaged," said Hill & Knowlton's Costerton. And if the customers know the company is offshoring those call centre services, "they blame it on offshoring".

The end result? "If you're involved in offshoring, [your customer experience] has to be better than others - which is unfair but true," she said.

Unifi's Murphy agrees that customer satisfaction is a "really big issue", one that he thinks many companies deciding to offshore have not addressed properly.