In the technology world, the term "outsourcing" usually conjures up visions of using offshore talent on a project or ongoing basis, but Rural Sourcing Inc. (RSI), an outsourcing organization formed in late 2003, takes a different approach to the concept by farming out work to underutilized workers in outlying areas of the United States.
RSI, based in Jonesboro, Ark., recently developed and implemented a Web portal
for the city of Jonesboro. The portal disseminates information about events and other programs in downtown Jonesboro to residents of outlying areas. Negotiations for an Arkansas state agency project are currently under way, according to founder and president, Kathy Brittain White.
"While it's no secret that we are pursuing the corporate side and have secured engagements there, state and local government agencies are a major target for us," White said. She added that such agencies favor the idea of fulfilling their IT needs with local talent because of the resulting positive impact on their areas' economy.
Aiming Beyond the Web
RSI's current focus is on application maintenance, as well as on Web hosting and Web-based technology development and implementation.
"We are interested in any project that clients, including government entities, don't want to do in-house -- specifically those that require frequent contact between clients' offices and the outsourcing organization," White said.
Application development and legacy systems support will be added to RSI's roster of services this year. White said she expects the firm to become a full-blown rural IT outsourcing entity within the next 12 to 18 months, with service options expanding to include systems integration. Clients pay $38 to $60 per hour for the company's services, depending on the skills required. According to White, RSI's fee is about one-third of what it would be in a major metropolitan area.
The company presently has 16 employees who work from one of three development centers in Jonesboro, Magnolia and Monticello, Ark. A fourth center will open in June 2005 in Greenville, N.C., followed shortly thereafter by a fifth center in Portales, N.M.
White said her ultimate goal is to create 50 sites in 20 states, all of which will offer a wide range of IT capabilities.
Spawned by Internship Program
The seeds for RSI were sown 10 years ago, when White, who was then CTO of Chicago-based health-care company Cardinal Health, experienced difficulties finding and maintaining skilled IT personnel. Since she was born and raised in Oxford, Ark. (population: 642), White was convinced a wealth of qualified workers existed outside big-city limits.
She embarked on a recruiting trip to an area of Arkansas where there were no companies and little industry in the towns, and she started a virtual internship program in which university students could remain in Arkansas and work on projects remotely. White continued the program when she became CIO of Baxter Healthcare, based in Cleveland, Ohio. Upon leaving that post in 2003, she saw an opportunity to expand the idea by establishing RSI.
White said part of the impetus behind her efforts was concern about the continued funneling of technology-related work to sources overseas. According to International Data Corp., the global market for outsourcing will grow at an annual rate of 7 percent, reaching $1.2 trillion by 2007.
"It was clear to me that if something was not done, in 10 years, every technology job in the United States would be overseas," she said. "That was a scary concept."
More importantly, White said she was convinced talented individuals would remain in or return to their rural hometowns or nearby areas if they could take advantage of opportunities to utilize their skills there. She was also certain the slower pace of rural life would appeal to other skilled workers, who would be willing to relocate to areas such as Jonesboro, provided they could find jobs to match their skill sets.
She said a recent advertisement for a program manager drew 360 applicants from all over the United States. Two employees of RSI's Jonesboro center worked as waitresses before being hired by the company. Despite their technological skills, neither had been able to secure a position in the technology field. Another staff member lives in Magnolia but was also unable to find a technology job there until RSI hired her.
Partnerships Bolster Reputation
Some initially questioned whether rural areas could be a good source of technology talent, White said.
She said she took concrete steps to dispel such skepticism, among them structuring RSI's business model with a focus on partnerships with higher learning institutions. Accordingly the firm's Jonesboro center is managed in conjunction with Arkansas State University; the Magnolia center partnered with Southern Arkansas University; and the Monticello center teamed up with the University of Arkansas at Monticello.
"Our 'feeder' schools need to be strong regional universities with strong computer science and information systems programs, as well as rigorous teaching methodologies and the most up-to-date technology," White said.
The Portales, N.M., center will work with Eastern New Mexico University, which has a campus in that city.
"When a company like RSI offers to partner with a university, the students see an attractive and realistic job opportunity," said Henry Torres, an RSI director and instructor of system development and analysis at Arkansas State University. "The university is then compelled to invest in cutting-edge programs, which include the use of modern equipment and talented faculty. Other companies notice a top source for new labor, so they move to the area as well. It's the kind of cycle that produced the Research Triangle in North Carolina and Silicon Valley in Northern California."
Teaming with local economic development agencies also is important because they're excellent sources of local talent and referrals, White and Torres said. An economic development authority in New Mexico wooed RSI to Portales.
Partnerships with systems integrators are expected to help RSI grow.
In October 2004, RSI announced a strategic partnership with Optimal Solutions Integration, an enterprise technology consulting firm headquartered in Irving, Texas. Under the agreement, Optimal Solutions Integration will include RSI in the low-cost Global Trust Services Portfolio it offers to public-sector entities and others. Instead of being outsourced offshore, Global Trust Services projects will be funneled to RSI.
"We may be small now, but I haven't been a little operator," White said. "I've been at very big companies, and I don't intend for RSI to stay small. I do intend to look more and more to local and state governments to build us up."