2nd Annual National Forum on Trade Policy (NFTP); December 8-10, 2004; Durham, NC from Duke University

Excerpt from Alumni Profile
Headline: Knowing When to Grow; and When to Slow
By John Manuel

Todd Lavieri, CEO and President of Archstone Consulting and Fuqua 1990 alumni, is sensitive to concerns that America is sending too many jobs overseas, but he insists offshoring is part of the evolution of the global marketplace and that companies face an even greater risk if they ignore it. "Global sourcing has been going on forever and will continue to be a trend," he says. "If a company doesn't send those 200 IT jobs to India, it may lose the 2000 jobs in Cleveland. The difference now is that it has extended to white collar jobs."

Last year, Archstone Consulting joined forces with Duke University's Center for International Business Education and Research (CIBER) to conduct a study examining the offshoring initiatives of 90 large companies. The purpose of the study was to benchmark key financial metrics and current perceptions of financial, operational and political risk associated with offshore operational models.

"We believe this is the first study that actually compiled data on strategies, plans and operating experiences with offshoring at the company level instead of relying on anecdotal information," says Arie Lewin, director of CIBER.

Presented last December at the 2004 National Forum on Trade Policy in Durham, the results found that 72 percent of offshore implementations met or exceeded their expected savings, with 31 percent achieving their service level goals within the first five months. More than 55 percent of the companies surveyed had cost savings expectations greater than 30 percent per year.

The study also found that while IT is the function most often offshored, high value services such as finance and accounting, engineering services and research are also being sent overseas. And while India is still the leader in offshoring operations, China, other Asian countries, the Philippines, Latin America, Canada and Mexico are growing in importance.

Asked what the study reveals about education in the U.S., Lavieri says, "There is definitely a gap to be filled by local colleges and schools. We found that American corporations outsource for two main reasons--they can't find enough people with the skills and staying power to staff things like call centers; and they can't find enough high end skilled people, specifically engineers and scientists. Fifteen years ago, people might migrate from India to the U.S. to fill those positions. Now, they are staying in India, maybe earning less money, but living like kings."

Lavieri's advice to Fuqua students who are concerned about outsourcing: "It's definitely a growing trend, but you are getting an MBA to be a global leader. You can continue to reinvent your company. Just keep your eye on that ball." He urges business schools not already doing so to offer courses in global outsourcing. "Put students in the position of running a company with 8,000 employees. Ask 'how do I make the products for less?' That's the real world."

While he may sound like an advocate for constantly churning the pot, Lavieri places a high value on enjoying the pleasures of life.

Testimonial:
"Congratulation on a very successful forum! I found the entire event both informative and enjoyable. I definitely learned things of great value, enabling me to better assist Washington State companies in the global marketplace. Furthermore, the opportunities provided to network with my fellow participants were invaluable."

I appreciate all your effort to promote international trade and look forward to next year's event."

Larry K. Williams, International Trade Director, State of Washington, Department of Community, Trade and Economic Development

[More CIBER Success Stories]