Indian call center lands in Ohio
More foreign companies are finding that hiring Americans offers distinct advantages, reports Fortune's Jia Lynn Yang.
FORTUNE Magazine
By Jia Lynn Yang, Fortune writer-reporter
August 3 2007: 5:49 AM EDT
(Fortune Magazine) -- It would be easy to imagine Reno, Ohio, as the type of place that would be hit hardest by outsourcing - a small American town losing out to the invisible hand shifting jobs to places like Bangalore and Guangzhou. Instead, outsourcing is bringing the jobs to Reno. Across the street from an Army Reserve center and next to a farm, a customer-service call center hums, its 250 workers answering phones for online travel agency Expedia. The center's owner? Indian conglomerate Tata Group.
The phenomenon has a name: "insourcing," the term experts are starting to use when foreign multinationals open offices on U.S. soil and hire Americans, at a higher price, to do the very jobs they once lured overseas. In this case the center in Reno is targeted toward companies willing to pay a premium - its workers there cost up to 40 percent more than their counterparts in India - to give their U.S. customers a more culturally fluent, less frustrating 1-800 experience. (No more hearing someone read from a script ten time zones away.)
Tata isn't alone. A growing number of multinational companies are building and expanding operations on U.S. soil. Below, a few unlikely examples.
Company U.S. investment Comments
Lehui Enterprises $12 million The Chinese condiment maker is planning a soy sauce factory outside Atlanta.
Wipro $150 million/office Indian IT services firm plans to open several software development offices in U.S. college towns.
Gruma $51.5 million The world's largest tortilla maker, based in Mexico, will open a factory in Los Angeles in 2008.
Tata, which is based in Mumbai, established its Reno roots last year when its business services unit, SerWizSol, bought the call-center business of travel-processing firm TRX; the deal also gave it a call center in Milton, Fla. "We want to be able to say to a client, If there's a piece [of call-center operations] you want to keep in America, we can do that for you," says Ricardo Layun, head of U.S. operations for SerWizSol.
More on Indian companies
Multinational corporations, of course, have been hanging shingles in the U.S. for years. According to the Organization for International Investment, firms headquartered abroad employ 5.1 million Americans in their U.S. offices. But while these jobs have typically been in manufacturing (think German carmakers' factories in the South), the mix is changing, and more companies are finding that hiring Americans offers distinct advantages. Some companies feel hearing a fellow American makes callers feel more comfortable. Other foreign firms think Americans bring a more entrepreneurial attitude to their work. In Expedia's case, its call-center workers need a firm grasp on U.S. geography.
Tata is trying hard to make a connection here. The company, which has a history in India of caring about social causes, has encouraged workers in Reno to get more involved in the community. There was a Tata float in the local Thanksgiving parade. Workers recently swept up a playground that had fallen into disrepair. And when an employee was injured in a car accident, Tata donated $500 to the family. Christy Rice, senior team leader, says those efforts demonstrate the biggest difference under the new owners. "It's less about numbers and more about people," she says
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