New Rational Outsourcing article published by the Outsourcing Journal

An article I co-authored just got published by the Outsourcing Journal (monthly newsletter and website sponsored by the Everest Group and part of www.outsourcing-center.com—the largest online educational resource on outsourcing) . The article is directly related to the topic of this blog. You can read it at http://www.outsourcing-journal.com/sep2006-barnard.html. For your convenience, here is the abstract:

FOCUS ON: Back-Office Errors
Beyond merely asserting 'Quality is Key': If you can't quantify the benefits of quality, you are only paying lip service to it:
As companies rush abroad to cut back-office costs, they forget one thing: the cost of small increases in error rates can wipe out the cost reductions from cheaper labor. Based on interviews with more than 50 financial services firms, BeyondCore determined that if the data-entry associated with one document costs $1, the downstream costs incurred for one document with a data-entry error can easily add up to $300. The solution: place far greater emphasis on quality than on processing cost.