The "homeshoring" revolution is already upending the call-center industry, enabling companies like Jet Blue and 1-800-Flowers to staff customer-care operations with people working from their own homes. More than 100,000 people are employed through such arrangements, and the tally grew 20% last year.
Now companies like oDesk are taking the homeshoring concept beyond the call center:
Its success will depend on whether companies are willing to reshape whole businesses, such as IT, design, or writing, that are traditionally staffed at the office. It's a big risk. For one, it's a lot harder to track and monitor people working on what are often longer-term projects, many critical to a company's success, than it is to count how many calls an employee can log in an hour.
oDesk does all sorts of things to build employers' trust:
The company conducts tests and checks references to ensure applicants know all the languages and skills they say they do. Only about 20% make the cut, oDesk says. The company also uses a self-policing feedback system akin to one pioneered by auction site eBay (EBAY ) that lets prospective workers and employers vouch for each other when they've had a good experience and pan one another if they've gotten swindled. Contractors who get positive feedback have been able to up their monthly rates, oDesk says.
The bigger hurdle to scale was helping companies monitor worker productivity and time management. Companies have a hard time policing employees in the next office over, much less thousands of miles away...
To keep everyone honest, oDesk takes random screen shots of what people are working on every 10 minutes. There's also a Web cam, so employers can physically see whether someone is at their desk, and a log showing how many mouse clicks or keystrokes are made per minute. It's not meant to be unduly intrusive, but rather to give the same degree of privacy -- or lack thereof -- people find in office settings where a manager can easily peer over a shoulder.
Finally, oDesk handles all the billing and payments -- which can get tricky with overseas currency conversions. It takes an employer's credit card before anyone can be hired, and automatically cuts a check to the contractor every week unless the employer objects. Of course, it takes a healthy chunk of that, tacking on 30% to whatever price people charge for their services.
Related stuff here
(bottom half of post for JetBlue's story).
And might tax policy
trip up homeshoring?