Is Dell’s experience with outsourcing customer service the tip of the iceberg? Today, even medical diagnoses are being outsourced despite patient discomfiture. Might we be seeing a reversal of nonmanufacturing outsourcing?

To save money, Dell had moved toll-free customer service and tech support to India in 2001. Consumers soon started complaining about foreign voices and communication problems. At first, Dell executives ignored the complaints, pointing out that the corporate clients who represented 85 percent of Dell’s business seemed satisfied. Evidently that satisfaction was either misread or had changed, because in 2004 Dell shifted support for business clients, but not for consumers, back to the United States. In a November 2005 semiannual survey of its own employees, the criticism was clear: “They felt we might not have been listening enough and that they didn’t think we were positioning the company for success,” Rollins recalled. “We felt terrible. We thought we could do better.” In late 2005, Dell hired 2,000 people for its U.S. call centers and stepped up training for 5,000 other reps—making a $150 million commitment to shift customer support back to the United States. The company spent an additional $100 million in 2006 to improve customer service, and call-wait times were down 50 percent.