Assignment Task
Outsourcing At Any Cost? Do Corporations Ever Have A Moral Obligation Not To Outsource?
In 1997, when Galaxywire.net, a successful Internet service provider, was looking fora new central office location, it found a very receptive community in Green Fork, 111.
With the unemployment rate hovering at 16 percent, the city was ready to offer thecompany a great deal in return for moving there. Galaxywire planned to hire 3,000 in itsfirst year, primarily in customer service, software engineering, and Web design.City development officials offered a $300,000 low-interest loan for employee training,a 50 percent tax abatement for the first 10 years, and even landed a federal grant toconstruct a new $2.3 million secondary building for day care and executive suites. WithGreen Fork only about an hour’s drive from Chicago, it seemed this small city of 30,000with plenty of willing and able workers was the perfect spot for Galaxywire’s home office.The company accepted the offer and at the official announcement ceremony, CEODale Horner predicted a bright future. For 35 years, Green Fork’s largest employer wasFreedman Steel, but the company left town after a lengthy and bitter labor dispute. Sincethen, locals had grown distrustful of large corporations. Acknowledging this, Horner madea substantial commitment to the residents: “We plan to stay and be an integral part of thecommunity,” he promised. “Our employees are really a family. Across the board,everyone is considered as important as the highest executive. Lots of companies saythat, but as I hope you’ll come to see, we’re rather different from most companies.”Seven years later, Galaxywire was thriving. Not only was the home office extremelyproductive, the company had expanded considerably, opening dozens of offices acrossthe country. Nevertheless, top management was considering closing the Green Forkoffice and moving its customer service, software engineering, and Web design units toIndia. The company stood to save at least $10 million a year by doing so. Customerservice employees earning $10-15 an hour in the U.S. earn only $2-4 in India. Similarly,Web designers and software engineers earning $60-70 an hour here earn only $6-8 an hour there.
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