More than two years ago, KLG was fired by the senior management of a Fortune 50 company for not being willing to endorse a plan to establish a large-scale operation in India. The site was intended to be an ultra-low-cost global support center with at least several hundred employees.

KLG was confident that there were much better options available. Because of the rapidly increasing demand for labor in India our view was that estimates of compensation savings were being overstated, overhead costs were going to ultimately be very high, workforce retention would be a challenge, and rapid wage inflation was just around the corner. We agreed with the client that – since we couldn’t endorse their decision – we were the wrong advisor to assist in the project, and that it would be best if we just parted as friends.

Since the firm opened the site, wages have been significantly higher than this client believed they would be and have also escalated by more than 15% per year, facility costs have been a heavy burden, turnover rates have been high, and many managers are not enthusiastic about the performance of the workforce.

KLG is now helping a number of this same firm’s business units identify alternatives to the current site in India.

Please take some time to look at just a few of the many examples of how we have helped companies develop location strategies and achieve significant competitive advantages:

Credit Suisse First Boston, Global Business Center, Raleigh-Durham, North Carolina
Institutional Securities Operations Center, Baltimore, Maryland
Chase Credit Card Growth Strategy, Tampa, Florida
Fixed Income and Derivatives Research Center, Budapest, Hungary
Getting fired by a client … and bragging about it

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