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  • From: Michael S Czeiszperger <czei AT webperfcenter.com>
  • To: InterNetWorkers <internetworkers AT franklin.oit.unc.edu>
  • Subject: How does outsourcing save money?
  • Date: Mon, 14 Aug 2000 16:32:46 -0400

> 5. How did the debate on "affordable health care" get replaced by
> "affordable health insurance"? (Seems to me that any fool could figure that
> any time you add a middleman, the price increases or the quality
> decreases....)
>

This is only tangentially related, but I've heard many times that a
company can take their IT staff, make them employees of a company such
as EDS or IBM, and save money. How can having the same people working
through a middleman charging 20-30% overhead save money? I realize that
you can put service charges on a separate budget than employees, but
when anyone looks at the bottom line isn't the profit margin less since
its costing more?

The only thing I can think of is what they're really outsourcing is
firing everyone and replacing the staff with fewer and cheaper
employees.

Michael Czeiszperger
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