As businesses expand into other countries and examine the pitfalls and benefits of outsourcing, the long fingers of this controversial phenomenon have reached out to touch business coffers as well as the lives of many American workers. Outsourcing of the
by Kellye Whitney
September 7, 2005
As businesses expand into other countries and examine the pitfalls and benefits of outsourcing, the long fingers of this controversial phenomenon have reached out to touch business coffers as well as the lives of many American workers. Outsourcing of the learning function—whether unique processes or the entire department itself—has been touted as a way for organizations to increase efficiency and save learning dollars. Many U.S. organizations have gone this route, but a recent report titled “Emerging Trends in Learning Outsourcing in the Asia Pacific” suggests that organizations in Asia-Pacific have been slower to move toward fully managed outsourced learning models.
Key drivers around outsourcing in the Asia-Pacific learning market include cost reduction and competitive advantage—more so than softer developments, such as increased productivity and better employee retention, said Dion Groeneweg, director at The Cape Group, which published the report. “Some organizations are looking to upskill their staff a lot quicker, and they also look at the whole technology focus. Asia-Pacific organizations, at least some of them, look at using technology as the most efficient and the fastest way of skilling their workforce.”
Asia-Pacific organizations are most likely to outsource certain learning elements, such as the help desk or other technology areas, rather than the entire learning function. “They wouldn’t take the full suite of the learning function and outsource that to a provider. We haven’t seen any big deals in Asia-Pacific like the Accenture/Avaya deal in the U.S. or something on that scale yet. They tend to be a lot smaller and very much focused on specific parts of the learning function,” Groeneweg said.
This isn’t necessarily new information, but there are quite a few challenges in Asia-Pacific that may affect senior-level learning executives here in the United States. For instance, in both regions the relationship between client and learning outsource provider is key. If that relationship is not solid and built along partnership lines, it’s very difficult for the provider to tailor a learning solution to meet that client’s particular needs. “Cooperation needs to exist between the provider and the client,” Groeneweg explained. “It’s sort of like co-sourcing, where customers share knowledge about their core business and competencies, which allows the supplier to form a long-term, intimate relationship. Customers have to be willing to share the information.”
The best relationships are formed when the client continues to look after the strategy or the part of the solution that is most closely linked to their core business processes. The provider must focus on facilitation of learning to support that core business. “Big challenges that providers are facing here in Asia is that clients struggle to articulate what they’re looking for, and that struggle leads to disappointment in the learning outcome at the end of the day,” Groeneweg said.
Sound familiar? Language and cultural barriers not withstanding, U.S. firms currently engaged in or considering outsourcing part or all of their learning functions experience the same problems. However, a lack of skills, resources and knowledge of how to execute an outsourcing deal or a lack of familiarity with learning outsourcing practices are not quite as problematic in the United States as in Asia-Pacific. “Very often we find that in Asia-Pacific organizations, a lot of the direction comes from a global point of view,” Groeneweg said. “In Asia-Pacific, companies are just not educated in learning outsourcing practices. That adds challenges. Most of the companies going down this (outsourcing) path are big multi-national corporations that have a presence in the U.S. and subsidiaries or offices in Asia-Pacific. We didn’t find any Asia-Pacific-based company that is outsourcing all of its learning.”
Groeneweg said that culture will always be a challenge in Asia-Pacific, thus it’s necessary to employ a localized approach. In this scenario, localized means more than simple language translation, and providers are responding, taking the time to educate the market and build the necessary relationships. “You need to be familiar with the culture, as well as understand the culture of training in these organizations because typically the organizations tend to train in a different way. There’s a lot of emphasis on standup (instructor-led) delivery of training. They’re just moving into the whole blended learning and use of e-learning to do a lot of things. Organizations don’t always have the infrastructure to deliver training.”
Another challenge centers on executive engagement. Currently, Groeneweg said that outsourcing efforts in Asia-Pacific are directed by training departments, not senior-level executives. “When it’s directed by training departments, we tend to get out-tasking rather than complete outsourcing. You’ve got training directors and managers who are making decisions, and those decisions meet the needs of groups and individuals, but not maybe the whole organization.”
As in the United States, learning in Asia-Pacific is frequently “thought-siloed” or specific to business units and not geared to meet enterprise-wide goals or organizational strategy. Change management or getting the organization to buy into the new learning approach is also an issue. “Everybody that we spoke to said that change management is a critical component,” Groeneweg said. “It’s always undercooked around any implementation. It’s about putting the resources and the time into helping people understand that they need to change their behavior. It’s getting the involvement of the whole company to capitalize on that change. They need to have change agents in the organizations who understand and can get them to use the processes.”
Finally, clients in Asia-Pacific don’t always know where to go for services or how to compare them and use benchmarking data to aid in their learning outsourcing decision-making process. “There’s certainly a need for benchmarking in the whole learning outsourcing space, which mirrors what’s going on in the U.S.,” Groeneweg said. “I think there’s a trend where organizations say, ‘How can we give up some data so we can go out and actually see what’s happening?’ I don’t think there’s enough benchmarking done in the U.S. yet. There’s very little data available around that yet. Some of the big companies might have some but in general benchmarking data is not available around learning outsourcing.
“There is an ongoing need for educating the market on the value of learning outsourcing,” Groeneweg added. “And there certainly needs to be an investment in building the skills and resources in organizations looking at this approach. Providers need to be part of that equation and help educate organizations. In Asia-Pacific, we really need a success story, a big client that has totally outsourced their learning function. We just haven’t seen that in the market yet.”