The Challenge Even disregarding high interest rates, the outsourcing world is poised for change. U.S. companies now routinely outsource call centers and software development. And as the outsourcing industry grows and becomes more sophisticated, some consequences become apparent. U.S. companies are looking for better-trained workers, not just English speakers, to fill the seats. As demand for qualified workers rises, rates do too. But the supply is finite. Clients, says FlexCorp's Cohen, have been complaining that "countries like India are running out of people who can satisfy their needs."

What You Can Do Since outsourcing isn't purely a price game anymore, don't treat it as such. With outsourcers becoming increasingly specialized, you might look for a call center where reps are trained in your industry. "Traditional companies," says Franke, "are [now] much more concerned with how big you are, what your balance sheet's strength is, and a specific knowledge of their industry." For example, a banking client used to use eTelecare's Philippines call centers to handle easy questions from customers, like "What's my balance?" Now, he uses Filipino agents who've passed advanced exams to advise callers on financial strategies.

Another option is sending different tasks to different outsourcers: customer service to one, telecom management to another. Don't forget about American outsourcers, either. "The biggest trend in clients we have in general is outsourcing. Not necessarily overseas but domestically too. Most are starting to understand what their core competencies are and are allowing experts like us to take over areas they're not competent in," says Mike Pierce, the Xpress Source CEO.