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Business Processes Come Home to Roost

Some businesses are moving outsourced chores back inside the company.

By Susan Kelly | Updated on October 27, 2014
Are your business processes in or out? For decades, companies have been sending work like accounts receivable, accounts payable and IT processes to be done in overseas locations where labor is cheaper. Over the last decade or so, they often handed that work over to a separate entity in the overseas location. Recently, though, there has been some pullback as companies brought work that they had previously outsourced back under their own umbrella—though not necessarily back to their same shore.

After making a significant move to outsource work in the mid-2000s, “companies are starting to think maybe they went a little too far,” said Johan Gott, senior manager with A.T. Kearney’s Global Business Policy Council. Gott said he is seeing clients move work that had been outsourced back into a company captive.

“They’re starting to look at what is the optimal footprint” for outsourcing, he said, adding that the most important consideration in this “insourcing” trend is “to retain knowledge inside the company.”

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