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Using Telepresence To Help Maximize Communication Efficiencies When Sourcing Abroad

- August 17, 2010 - 0 Comments

It’s interesting to see how the outsourcing trend is heating up in Asia as the traditionally dominate Japanese technology companies face increased competition from Chinese and South Korean competitors. This is evident in a recent Wall Street Journal article reporting on Toshiba’s plans to reduce costs substantially over the next 3 years by working with more oversees suppliers, as well as Hitachi’s decision last June to source more materials oversees.

As the Wall Street Journal notes, “Cost efficiency is crucial, particularly in newly emerging markets, if Japanese electronics makers are to compete against Asian rivals.” There’s no question that outsourcing is a proven approach for reducing costs, but having globally dispersed partners and suppliers inevitably adds a layer of complexity to the communication chain.  So the question is, does the risk of communication efficiencies outweigh the cost efficiency of working with global suppliers?

Many business people who have worked with international counterparts and experienced the challenges of working with different cultures, time zones, etc. can probably attest to many communication barriers and break downs. Furthermore, when you consider that more than half of communication effectiveness is determined by nonverbal queues, it becomes apparent that face to face communication is a must have for any level of success in this type of outsourcing model. It’s almost surprising that we can manage to accomplish all we do via telephone calls and emails, but when working with suppliers and partners across the world in various cultural environments, these forms of communication simply won’t do.

Many companies take the route of regular travel to meet in person and observe processes to help ensure their business can continue to run smoothly – edging out some of the cost savings from outsourcing and running executives and other staff ragged. Other foresighted companies have invested in telepresence technology that enables them to meet with anyone, anywhere at anytime, eliminating burdensome and costly travel. For example, Tommy Hilfiger used a customized telepresence solution to create virtual fittings rooms to enable their design teams – based in Amsterdam and New York – to collaborate faster and more effectively with the manufacturing team in Hong Kong. Watch the video below to see the teams discuss how telepresence helps them collaborate about the development of every single piece of the collection face-to-face more efficiently and with less travel.

In observing this growing outsourcing trend in Asia, it occurred to me that the key to maximizing the value of outsourcing will be ensuring the right tools and technologies are in place to enable effective communication. Being that Japan is on the forefront of driving technologies and has historically driven the adoption of many new and emerging technologies, it will be interesting to see how the further adoption of visual communications in this  era will help them not only remain more competitive, but also drive additional business efficiencies and value.

For more examples of companies successfully using telepresence to help drive their business visit www.cisco.com/go/telepresence

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