Services Supply Chains

Writing in yesterday’s Chicago Tribune, attorney and adjunct professor at the School for New Learning at DePaul University David Steiger writes that the outsourcing in the IT industry is just a precursor to what’s coming in other industries:

It is becoming clear that CPAs, management consultants, attorneys and health professionals who traditionally have been insulated from global market forces will be faced with competition as they never have seen before: bright, driven people capable of offering comparable-quality service at perhaps a tenth the cost of their developed-world counterparts.

He says, a bit later:

Because transportation costs are low and communications sufficiently sophisticated to coordinate each part of the supply chain, manufacturers have incorporated developing-world labor into their operations seamlessly and profitably.

What seems to have been lost on most commentators and the public until now is that communications technology has made services supply chains possible, and more important, economically compelling. As service professionals perform more job functions by using networked computers, it becomes easier to work on a given project remotely.

Readers of this blog, of Ernie, Jerry and others know that this talk of a much-needed change in business models is long overdue in the legal profession. And I can’t say I disagree with Steiger when he says that some of the work currently done for tens of thousands of dollars in the legal profession could be done for a fraction of the cost overseas.

But to set this up and then conclude that the legal profession (and others for that matter) are going to more or less disappear as a result of this automation? That seems a bit of a stretch to me.

I’m going to read through this again later today to try and formulate exactly why this strikes me as over-reaching. In the meantime, your comments are welcome.