Article at a glance:

Offshoring and beyond

Companies that send their back-office jobs offshore often cut their labor costs by as much as half. But new research by the McKinsey Global Institute finds that these companies risk leaving billions of dollars in savings behind if they merely replicate what they do at home in countries where labor is cheap. The savviest operators redesign business processes to exploit automation and take full advantage of the new environment's potential.

The take-away

Transforming business processes as part of a strategy to offshore back-office functions can release massive new revenue opportunities even more valuable than the obvious labor cost savings that come with offshoring.