Off-Shoring - the Final Fronter

In the quest to cut cost and become more competitive, companies have taken a bold new step that promises to significantly improve the bottom line: out-sourcing senior management.

For years now, US companies have been looking overseas for cheap labor. During the late 1990’s and early 2000’s, high tech companies have set up large scale software development, as well as contracting for skilled jobs such as healthcare functions like radiology.

Now companies have taken the next logical step and out-sourced their senior management overseas as well. “At first we were not sure.” says Rob “gimme-bucks” Smith, who serves on the board for American Nincompoop, a fortune 500 company. “But then we realized a $100 million dollar savings just by replacing the CEO! Once we were done with the senior management team, we had cut costs by nearly $200 million.”

One concern that companies have when eyeing out-sourcing is that they can get the same level of quality management that they enjoy in the United States when using over-seas workers. “That was a real concern for us.” says Gloria Seinfeld, part of the “blood-letting” team that helped turn the airline giant “United Crash” around and out of bankruptcy. “Then we realized that it would be difficult to find people that could make worse decisions than what we already had. The over-seas clowns would have a very high bar to reach if they ever wanted to be as stupid as we are in the US!”

One unforeseen consequence of out-sourcing management has been a dramatic improvement in the quality of the decisions coming from upper management. While management both at home and overseas is incompetent, out-sourced managers know it and are willing to listen to their people. “It was shocking” says Ken Utah, senior director for Internal Bullocks Machines. “I made a recommendation and Rajeev [Indian manager who replaced the CEO] actually followed it.”

Out-sourcing companies have a real threat to hold over the heads of their managers. “Before, all you could do is threaten to dismiss them. But now when we use the phrase ‘heads will roll,’ we mean it!” Karen LePoosh, member of the Ballmart board of directors relates. Indeed, over the last 3 years, 5 CEOs and 17 senior managers have been executed as a result of foolish mistakes, something that would be much harder to do with local talent. “I told the last local CEO that we were going to cut some of his compensation package and he laughed in my face. With our new, out-sourced talent, I’ve personally killed 6 people. It’s a surprisingly satisfying experience.”

While the board may be happy with the new, out-sourced management team, what do the rank and file workers think of this development? A recent Pee-Yew poll of Foullon, the energy giant, revealed that most employees either didn’t care or looked on these changes as favorable. “They’re both clueless” says Jake Blather, refinery worker in Newark, NJ. “I can’t tell the difference.” Other workers are more favorable such as Norman Bates, who works at a chemical plant in Wisconsin. “Last year when the HR director tried to pocket $3.2 million and they executed him, I thought to myself ‘Now there’s accountability!’”

Resident managers at US companies are less enthusiastic about these developments, however. A recent interview with Bill Whaleson, CEO of Kegel, the supermarket powerhouse, yielded the following: “I like pie.” Other executives stress that home-grown stupidity will always be superior to out-sourced idiocy. “They can try, but they’ll always come up short.” Ken Screw, CEO of Trip Communications. “I mean, how can you cause a huge lawsuit to be leveled at your company when you don’t understand the local situation? Take the recent multi-billion dollar anti-discrimination case being brought against us: now that’s the kind of foolishness that can only be found with good old American know-not!”

Indeed, many present and former executives point to huge lawsuits, massive market share loss and other mistakes with pride. Speaking from his jail cell in Canyon City, Colorado, Louis Cypher, architect of the 1995 collapse of the energy giant, Benron, had this to say: “There’s just no way that an overseas clown and achieve my kind of failure. It takes near-psychotic detachment from reality, coupled with mind-boggling arrogance to do what I’ve done [referring to the multi-billion dollar collapse of Benron]. That’s the kind of colossal mistake I just don’t see these out-of-towners making.”

Technorati: off-shoring, management, clueless, stupid, out-sourcing