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Hello, India? I need help with my math


Posted: 2007-11-08 00:00:00+05:30 IST
Updated: Nov 08, 2007 at 0216 hrs IST

: Adrianne Yamaki, a management consultant in New York, travels constantly and logs 80-hour workweeks. So to eke out more time for herself, she routinely farms out the administrative chores—making travel arrangements, restaurant reservations and buying theatre tickets—to a personal assistant service, in India.

Kenneth Tham, a high school sophomore in Arcadia, California, strives to improve his grades and scores on standardised tests. Most afternoons, he is tutored remotely by an instructor speaking to him on a headset while he sits at his personal computer going over lessons on the screen. The tutor is in India. The Bangalore butler is the latest development in offshore outsourcing.

The first wave of slicing up services work and sending it abroad has been all about business operations. Computer programming, call centres, product design and back-office jobs like accounting and billing have to some degree migrated abroad, mainly to India. The Internet, of course, makes it possible, while lower wages in developing nations make outsourcing attractive to corporate America.

The second wave, according to some entrepreneurs, venture capitalists and offshoring veterans, will be the globalisation of consumer services. People like Yamaki and Tham, they predict, are the early customers in a market that will one day include millions of households in the US and other nations.

They foresee an array of potential services beyond tutoring and personal assistance like health and nutrition coaching, personal tax and legal advice, help with hobbies and cooking, learning new languages and skills and more. Such services, they say, will be offered for affordable monthly fee or piecework rates.

“Consumer services delivered globally should be a huge market,” observed KP Balaraj, MD of the Indian arm of Sequoia Capital, a venture capital firm in Silicon Valley.

But globalisation of consumer services faces daunting challenges, both economic and cultural. Offshore outsourcing for big business thrived partly because the jobs were often multimillion-dollar contracts and the work was repetitive. In economic terms, there were economies of scale so that the most efficient Indian offshore specialists could become multibillion-dollar companies like Infosys, TCS and Wipro.

It is not all clear that similar economies of scale can be achieved in the consumer market, where the customers are individual households and services must be priced in tens or hundreds of dollars.

Then there are the matters of language, accent and cultural nuance that promise to hamper the communication and understanding needed to deliver personal services. Already, some American consumers voice...

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